GLOSSARY

Common Club Terms and Definitions

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5 X 5 RULE

Member needs to know in 5 sec. from 5 feet what your product is, your value, and why they need to purchase

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BLISTER

Synonym:  thermoform, vac-form

Low cost plastic custom formed to hold product.  Used as a Tray or captured in a Trap Card

Material of choice is (r)PET.  Widely recyclable throughout the US.  

PVC is a material which is allowed in Costco!!

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BUTTERFLY SKIRT

Not a false bottom, this innovate design creates a billboard and raises product up to a shoppable height. 
Be careful, there are multiple patents on its construction and attachment!

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CARDBOARD (AKA PAPERBOARD)

Cardboard or paperboard refers to a thick paper stock. You can see this type of material used for cereal boxes or greeting cards.

Not to be confused with corrugated board.

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CORRUGATED

Corrugated can be identified by the wavy "medium" in between 2 or more flat paper liners.  

Corrugated is specified by the following:

1) Board style:  Single wall, double wall are the most common.

2) Flute type:  A, B, C, E and F specify the height of the medium.  Flute choice depends on strength and printing requirements.

2) Strength: Specified as Burst or ECT (Edge Crush Test). Stack height, product weight and other handling requirements will determine the required strength.

Note:  Costco doesn't specify corrugated material specs.  It's up to the supplier to ensure the specs allow product to flow safely through Costco's supply chain.  

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CROSS-DOCK

Cross-docking involves unloading materials from an incoming truck at consolidation points and loading these materials directly into outbound trucks with little or no storage in between

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DEPOT

Costco’s depots is the terminology used for distribution centers.  Although these distribution centers hold very little inventory.  The depots utilize cross-docking
for handling full pallets of merchandise from suppliers to warehouses.

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FEATURE PALLET

Self contained, free standing product display on a 40" x 48" pallet.  Used to ship and showcase product in Club

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ISPM 15

Regulatory compliance for heat treatment (HT) of pallets which is required when shipping product from overseas on solid wood pallets.

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ITEM NUMBER

A unique seven digit number assigned to your item.  This number must be listed above your UPC code (and often requested to be added to the font of your packaging)

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MARKETING WEDGE

Both filler and marketing billboard, use this when your product needs more real estate to communicate value to members

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MEMBER

Costco refers to their customers as members.  As of 11/22/20, there are 107.1 million (as of 11/22/20) Costco card holders.

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CHEP / PICO / IGPS  PALLETS

Blue (CHEP), Red (PECO) and Black (iGPS) are pallet rental services for 40" x 48" pallets. You are charged a daily rental rate until the pallet is delivered into retail and removed from your books.

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PULL CARD

Used for high value/ high theft items locked in cages behind the register.
A member will take this card with them to the register for payment and receive the product, and the Card is returned to the Feature Pallet Display.

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REPLENISHMENT

Restocking of product.  Often sent into depots and separated by layer or case during cross dock. 


Here is a picture with a protective cover (HSC= half slotted container)

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THE STEEL

Fancy Costco jargon for placing items on the metal warehouse racking (shelves) opposed to feature pallet displays.

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SUPPLY CHAIN

The network between Costco and its suppliers to produce and distribute products through Costco Depots and finally to Costco Warehouses.

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SUSTAINABILITY

Costco expects that all packaging component materials should be readily recyclable, compostable, or
biodegradable by consumers in the areas where the product will be sold.

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TRAP CARD

Synonym:  Blister Card, Trap Blister

Presentation packaging used as a billboard to showcase value, highlight features and reduce theft.  A thermoformed blisterform is sandwiched between layers of corrugate or paperboard

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UNDERHANG/ OVERHANG

Costco uses only 40" x 48" pallets.  Design your pallet right from the start.  Underhang (smaller footprint) leads to stability and shifting issues.

Overhang (larger footprint) is not allowed in Costco


Costco Specifications state: Unitload footprint must not exceed 48"x40", and cannot be smaller than 44"x37". Recommended footprint is 47.5"x39.5".

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VALUE STATEMENT

A compliment to the 5x5 rule
Its your products competitive advantage.  Often placed on the front lip of a branded Tray.

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WAREHOUSE

Costco uses the term warehouse when describing their 803 retail locations worldwide (As of 11/22/20).  Look around at the pallet racks on your next trip to Costco.  You are actually shopping inside of a warehouse.