Glossary
Glossary for online shops: 13 terms in plain English
Each definition is taken from one of our guides, which gives the rule in full and where it comes from. The terms are in alphabetical order.
AI resolution pricing
The way helpdesk vendors charge for automated replies: per conversation the software answers, not per staff login. On the pages we read, Gorgias Pro includes 190 AI replies and charges US$1.50 for each one beyond that, and Zendesk charges £1.30 for each AI resolution beyond the five a month included for each agent.
Source: Gorgias and Zendesk UK pricing pages, read 1 October 2026
Cancellation period (14-day right)
The 14 days after delivery in which a customer who bought online can change their mind and send the goods back. If the shop never gave the cancellation information, the 14 days becomes 12 months and 14 days. The refund includes the standard delivery charge.
Free tool: Returns rights checker: what this customer is owed, by when, and who pays the postage
Source: Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, regulations 30, 31 and 34
Chargeback
A card payment reversed by the customer's bank after the customer disputes it. On Stripe in the UK a dispute costs £20 when it arrives and a further £20 if the shop counters it, the second returned only if the shop wins. The response window is 7 to 21 days, by card network.
Source: Stripe UK pricing and disputes documentation, read 1 October 2026
Compensation for a lost parcel
What a carrier pays when it loses a parcel. Royal Mail pays a lost Tracked parcel at what the item cost the shop, not its sale price, up to £150 on a business account or £75 on Tracked postage bought online, and only if the claim is made in time. Evri's standard cover on evri.com is the lesser of £20 or the value.
Source: Royal Mail business claims page; Evri terms and conditions, read 1 October 2026
Incentivised review
A review the customer was given something for. Since 6 April 2025 it has been a banned practice to commission a review that hides its incentive. Emailing customers generally to ask for a review is not prohibited; asking only the satisfied ones is treated as cherry-picking.
Source: Digital Markets, Competition and Consumers Act 2024, Schedule 20; CMA guidance on fake reviews
Lead time
The days between placing an order with a supplier and the stock arriving. It is the one input a reorder point needs that Shopify's own inventory features do not hold, which matters now Stocky is no longer available after 31 August 2026.
Source: Shopify help centre, Stocky, read 1 October 2026
Regulatory operating fee (Etsy)
A percentage Etsy adds to a UK seller's fees on each sale. It rose to 0.48% on 22 June 2026. With it, Etsy takes £6.47 from a £42 item with £3.95 postage sold by a seller who is not VAT registered.
Free tool: Etsy and Shopify fee calculator for UK sellers: what one order actually costs on each
Source: ChannelX report of the fee change, April 2026; two UK seller guides, read 1 October 2026. Etsy's own fee page could not be read by our reader
Reorder point
The stock level at which a new order has to be placed so it arrives before the shelf empties: daily sales multiplied by lead time, plus safety stock. A product selling 3.5 a day with a 21-day lead time and a week of safety stock has a reorder point of 98 units.
Source: Our own arithmetic, in tests/packhand/tools-check.txt
Return on ad spend (ROAS)
Sales divided by advertising cost. The break-even figure is the selling price divided by the profit on one order before advertising. A £24 product that leaves £6.72 an order after VAT, costs, fees and returns breaks even at a return on ad spend of 3.57.
Source: Our own arithmetic, in tests/packhand/tools-check.txt
Return postage
The cost of sending goods back after a change of mind. The customer pays it only if the shop said so before the order was placed. A returns policy that does not say so leaves the shop paying.
Source: Consumer Contracts Regulations 2013, regulation 35(5)
Risk in transit
Who bears the loss if a parcel goes missing. Under the Consumer Rights Act goods remain at the trader's risk until they come into the consumer's physical possession, so a lost parcel is the shop's problem to put right, not the customer's to chase with the carrier.
Source: Consumer Rights Act 2015, section 29
Tracked 48
Royal Mail's two-day tracked parcel service. From 5 October 2026, on eBay UK's published tariff summary, Tracked 48 bought online is £3.75 for a small parcel up to 1 kg against £4.40 for 2nd Class by stamp, so the tracked service is 65p cheaper than the untracked one.
Source: eBay UK tariff summary of Royal Mail prices from 5 October 2026
VAT registration threshold
The £90,000 of taxable sales in any 12 months above which a shop must register for VAT. The test uses sales, not payouts: a shop whose sales reports total £91,300 across Shopify, Etsy and eBay is over, even though its payouts total £84,900.
Source: GOV.UK, VAT registration: when to register
AEO Lookup editorial team
We write practical guides for people who run small UK firms, and we check every fact against its source on the date shown. Read how we review, or tell us if something has changed.