GLOSSARY
Common Club Terms and Definitions
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
BLISTER
Synonym: thermoform, vac-form
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Low cost plastic custom formed to hold product. Used as a Tray or captured in a Trap Card
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Material of choice is (r)PET. Widely recyclable throughout the US.
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PVC is a material which is allowed in Costco!!
BUTTERFLY SKIRT
Not a false bottom, this innovate design creates a billboard and raises product up to a shoppable height.Â
Be careful, there are multiple patents on its construction and attachment!
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.
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Not to be confused with corrugated board.
CORRUGATED
Corrugated can be identified by the wavy "medium" in between 2 or more flat paper liners.
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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.
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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.
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
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.
FEATURE PALLET
Self contained, free standing product display on a 40" x 48" pallet. Used to ship and showcase product in Club
ISPM 15
Regulatory compliance for heat treatment (HT) of pallets which is required when shipping product from overseas on solid wood pallets.
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)
MARKETING WEDGE
Both filler and marketing billboard, use this when your product needs more real estate to communicate value to members
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 / IGPSÂ Â 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.
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.
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)
THE STEEL
Fancy Costco jargon for placing items on the metal warehouse racking (shelves) opposed to feature pallet displays.
SUPPLY CHAIN
The network between Costco and its suppliers to produce and distribute products through Costco Depots and finally to Costco Warehouses.
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.
TRAP CARD
Synonym: Blister Card, Trap Blister
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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
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".
VALUE STATEMENT
A compliment to the 5x5 rule
Its your products competitive advantage. Often placed on the front lip of a branded Tray.
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.