Glossary
The words fashion ecommerce runs on, defined properly.
Sell-through, size curves, weeks of cover, contribution margin and more, each with a formula, a worked example and where it lives in Fabrik.
- Broken size runA style that is still selling with one or more of its sizes out of stock, so the customers who need those sizes cannot buy it.
- Contribution marginWhat sales leave after the costs that grow with them: goods, then fulfilment and fees, then marketing. Often split into CM1, CM2 and CM3.
- Creative fatigueWhen an ad's results fall as the same people see it again and again: click-through falls, cost per result rises and ROAS drifts down.
- Dead stockStock that has stopped selling: lines with no sales in a period, or with so much cover they will not sell through this season.
- MarkdownA lasting price cut on a line, usually to clear stock before its season ends, as distinct from a promotion that ends on a set date.
- Marketing efficiency ratio (MER)All your revenue divided by all your marketing spend over the same period, whichever channel claims the sale.
- Profit on ad spend (POAS)The profit from the orders an ad drove, divided by what the ad cost. Unlike ROAS it counts cost of goods, tax and fees, so it can fall while ROAS rises.
- Reorder pointThe stock level at which you reorder, so new stock lands before the old runs out: sales during the lead time plus a safety buffer.
- Return rateThe share of what you sold that customers sent back, by units or by value, measured on the orders of a given period.
- Sell-through rateThe share of the stock you had that sold in a period: units sold divided by the units you started with plus the units received.
- Size curveHow a style's sales split across its sizes, as a share of units. The curve you sold is the best guide to the curve you buy next.
- Weeks of coverHow many weeks your stock will last at the recent rate of sale: units in stock divided by the average units sold each week.