What are the most important wholesale terms for new brands?

The most critical terms to know are Net Payment Terms, MOQ (Minimum Order Quantity), Chargebacks, and OTB (Open to Buy). These directly affect your cash flow, production feasibility, and retailer relationships.

Why do retailers use Net 30 or Net 50 terms?

Retailers use net terms to manage their own cash flow, often delaying payments to vendors. Brands must plan ahead to cover production and shipping costs while they wait to get paid.

What’s the difference between MOQ and Order Minimum?

MOQ applies at the style level (minimum units needed to produce that product). Order Minimum is the total order requirement (in units or dollars) that a retailer must meet to work with you.

How can I avoid chargebacks?

The best way to avoid chargebacks is by following retailer compliance guides carefully. Double-check shipping labels, packaging, and required documentation before sending orders. Tools like the RepSpark Admin Panel help brands stay compliant and organized.

Wholesale Terms Glossary | Essential Wholesale & Retail Definitions

Chapter I: Introduction
Chapter II: Payments & Financial Terms
Chapter III: Shipping and Logistics
Chapter IV: Sales and Buying Terms
Chapter V: Design and Production Terms
Chapter VI: Manufacturing and Operations

Chapter I: Introduction

Breaking into wholesale can feel like learning an entirely new language. From payment terms to production jargon, understanding the vocabulary of wholesale retail will set you on the right path toward building strong partnerships with buyers, manufacturers, and retailers.

That’s why we’ve built this Wholesale Terms Glossary. Think of this as your go-to resource on your journey toward wholesale growth.

Whether you’re new to wholesale or just need a refresher, these definitions will help you feel confident in conversations with retailers, factories, and distributors.

Come back often as we plan to update this with phrases we've missed and new ones that come up as technology evolves.

Net Payment Terms (Net 30 / Net 50 / etc.)
The payment window agreed upon between brand and retailer. For example, Net 30 means you’ll be paid 30 days after the retailer receives your goods. Essential for planning cash flow.

Factor
A financial service that guarantees invoice payment by running credit checks on retailers. Factoring protects brands from unpaid invoices and gives retailers confidence in your reliability.

Terms
The payment arrangement with a manufacturer. These can be set up for payment upfront, in installments, or post-delivery. Startups typically pay upfront until they’re established.

Margin
The profit percentage retailers expect when reselling your products. Know their margin targets before negotiating wholesale pricing.

Keystone Markup
A standard retail markup, generally double the wholesale cost (50%). Example: a $7 wholesale item sells for $14 at retail.

MSRP (Manufacturer’s Suggested Retail Price)
The price you recommend retailers sell your product for in stores. Actual retail price may vary.

MAP (Minimum Advertised Price)
The lowest price retailers are allowed to advertise. Protects your brand from being undervalued online or in-store.

Buyback / Guaranteed Order
An agreement where unsold products can be returned to the brand. Lowers retailer risk and can help new vendors secure shelf space.

Markdown Allowance
A financial contribution you provide to retailers to help offset margin loss when items are discounted.

Markdown Money
Similar to allowance. Retailers may request brand support if products are marked down at season’s end.

Advertising Co-Op
A shared marketing cost where your brand pays to be featured in retailer ads, catalogs, or promotions.

Chargeback
A financial penalty for not meeting retailer shipping or compliance rules (wrong labels, packaging, timelines). These deductions come directly out of your invoice.

Vendor Compliance
A retailer’s required standards for shipping, packaging, and labeling. Essential to review before fulfilling orders.

Packing List
A document included with shipments that details what’s inside each box by style, size, and color.

Freight Forwarder (FF)
A third-party company that manages international shipping, customs, and logistics.

FOB (Freight on Board)
The price of goods at the shipping point, excluding freight, insurance, and duties.

Landed Price
The total cost a retailer pays. This price includes product, shipping, customs, and duties.

HTS Code (Harmonized Tariff Schedule)
A standardized code for classifying international goods to determine duty rates.

Shipping Window
The timeframe between a start-ship and cancel date when an order must be delivered.

Distribution Center (DC)
Retail hubs where shipments are received, sorted, and redistributed to stores.

Drop Ship
A fulfillment method where your brand ships directly to the end customer on behalf of a retailer.

Backordered
Items delayed in fulfillment but kept on the original order to ship once restocked.

ATS (Available to Ship) / Immediate
Inventory that is in stock and ready to ship right now. Different from seasonal pre-booked buys.

OTB (Open to Buy)
A retailer’s purchasing budget for upcoming inventory. Buyers use OTB to test new vendors after securing core buys.

WTD / MTD / STD / YTD
Sales reporting shorthand: Week-to-Date, Month-to-Date, Season-to-Date, Year-to-Date.

POS (Point of Sale)
Where and how sales happen (in-store register, online checkout). Also refers to markdowns applied at checkout.

Line Sheet / Product Line
A catalog of your wholesale products with pricing, style numbers, and ordering details for buyers.

Vendor Minimums / MOQ (Minimum Order Quantity)
The minimum number of units required per style to justify production.

Order Minimum
The minimum order size (units or dollars) required to open or maintain a wholesale account.

Case Pack
The smallest multiple of a product that can be ordered, usually based on efficient shipping quantities (e.g., multiples of 6).

Full Production Package (FPP)
A manufacturer service that handles the full lifecycle: design, sampling, and production.

Tech Pack
Your production blueprint with garment details like measurements, fabrics, trims, and sketches.

Bill of Materials (BOM)
A breakdown of all materials needed for production such as fabrics, trims, packaging, and tags.

Flat Sketch
A 2D technical drawing of a garment laid flat to show seam and construction details.

Tech Sketch
A technical drawing used by factories for sample making and production.

CAD (Computer-Aided Design)
A digital rendering used to visualize and refine designs before production.

Grading
The process of scaling a garment’s base size up or down across the size range.

DTM (Dyed to Match)
Trims or accessories dyed to match a garment’s fabric.

Lab Dip
A swatch sent for color approval before bulk dyeing.

Strike Off
A printed fabric sample confirming design and color accuracy.

Fabric Yield
The amount of fabric required to produce one garment.

Call-Out
A specific note or production detail flagged for the factory.

Samples
Prototype garments used for testing, approvals, or sales meetings. Includes pre-production, size sets, sales samples, and top-of-production samples.

Purchase Order (PO)
The official document from a retailer confirming quantities, styles, and delivery dates.