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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
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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 not 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.Â
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.
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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.
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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.
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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 / 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.
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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
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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
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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.