Defining Scan Based Trading

Defining Scan Based Trading

Here at Park Merchandising, we specialize in Scan Based Trading (SBT), inventory distribution, and comprehensive inventory management in boutique and mass-merchants across the USA. We currently provide complete merchandising services in over 30,000 storefronts nationally.

What is scan-based trading?

“Scan-based trading, or SBT, is a widely-used payment solution that aligns supply and demand at the retailer’s point of sale, thereby providing substantial operational savings to retailers and distributors alike.” (https://www.icontroldata.net/blog/the-advantages-of-scan-based-trading-for-distributors) Distributors own the physical inventory until it is scanned out and sold to a customer. At this point, the distributor passes ownership to the retailer. Until then, the distributor owns the inventory and has control over any ordering, merchandising, and delivery of the product. “Since SBT takes the responsibility and ownership of the merchandise off of retailers, it has continued to grow in popularity in the retail world. Being only accountable for those items that actually sell, retailers are able to reduce their inventory holding costs and minimize risks of spoilage and shrinkage.” (https://www.inddist.com/article/2016/06/how-distributors-can-win-scan-based-trading) More and more retailers are leaning towards using SBT systems within their stores because of the benefits and advantages that come with it.

Here are the main advantages of using Scan-Based Trading services for retailers, distributors, and customers:

1. Retailers do not have to worry about product shrinkage, product placement, inventory holding costs, and merchandise orders
2. A developing retailer/distributor relationship often results in the distributor becoming the preferred vendor for that store
3. Retailers are only accountable for the items sold
4. Smarter promotion and product placement within the store
5. Provides a better buying experience for the customer
6. Distributors have immediate access to POS data giving them insights to real-time performance
7. There are common goals and objectives for the product and for the store: agreements between both parties result in better servicing and reduced billing/invoice issues for accounts
8. Direct insight to causes of profit/revenue loss
9. Distributors no longer have to tediously check deliveries at every retail store: deliveries are faster while transportation costs are lower
10. Higher efficiency rates and cost savings for distributor

*Recap for advantages of SBT from https://www.icontroldata.net/blog/the-advantages-of-scan-based-trading-for-distributors