Allocation

The quantity and tier of product a brand permits an account to buy. It is granted on history, sell-through and store environment — not ordered. It is the single largest constraint on this business.

Authorised retailer agreement

The contract with each brand governing allocation, pricing, territory and termination. It is the business, and it should be read by counsel before any lease is signed.

Full-price sell-through

Units sold at full price divided by units bought. 73% in this plan, against an industry norm that has fallen from 70–75% toward roughly 50% at many retailers.

Grey market

Genuine product imported outside authorised channels. It undercuts on price without carrying store, staff or returns costs, and buying from it risks the brand relationship.

Markdown cascade

The sequence of discounts applied to unsold stock. At a landed cost of R648 against a full price of R1 360, gross profit reaches zero at a 47.6% discount.

Realised price

The average price actually achieved after markdown, R1 219 a pair at Year 1 prices against a blended list price of R1 360.

Section 20 limitation

The South African rule capping the set-off of assessed losses at the higher of R1 million or 80% of taxable income in any year.

Size curve

The distribution of demand across a size run. About 70.6% of demand sits in four sizes, and buying to that curve rather than flat is worth 20.5% more gross profit on identical stock.

Small Business Corporation rates

Graduated South African tax rates available while turnover remains below R20 million. Revenue passes that threshold in Year 2, after which the standard 27% rate applies.

Stock turns

Cost of sales divided by average stock at cost. 4.2 times here against an industry median near 4.4; footwear turns slowly because one style becomes fifty-odd size SKUs.

Tier zero

The most tightly rationed limited-release product. 4% of units and 9.7% of gross profit in this plan; it drives footfall rather than profit.

Trading density

Store revenue divided by trading area. Measured on store revenue only, excluding online, because it is the number a landlord and a lender both use.