{"id":3329,"date":"2021-02-12T12:34:47","date_gmt":"2021-02-12T18:34:47","guid":{"rendered":"https:\/\/www.rmservicing.com\/?post_type=articles&p=3329"},"modified":"2021-02-12T12:34:47","modified_gmt":"2021-02-12T18:34:47","slug":"scan-based-trading-grow-retail-sales-improve-inventory-management","status":"publish","type":"articles","link":"https:\/\/www.rmservicing.com\/articles\/scan-based-trading-grow-retail-sales-improve-inventory-management\/","title":{"rendered":"Scan-Based Trading: A Tool to Grow Retail Sales and Improve Inventory Management"},"content":{"rendered":"\n

The New Year has retailers focusing on spring retail reset season. Of course, resets happen throughout the year, but spring and fall resets are key transition times.<\/p>\n\n\n\n

It is prime time for brands to introduce new products, train\nstores on new offerings, and recalibrate strategy from lessons learned in the\nprevious year.<\/p>\n\n\n\n

Keep reading to learn how brands can maximize the impact of spring resets and get on a path to success in 2021.<\/p>\n\n\n\n

\u00a0Scan-based trading<\/a> (SBT) is a tool that helps retailers and trading partners drive operational efficiencies by aligning supply and demand at the point of sale. It enables vendors to retain ownership of physical inventory until that product is swiped at the checkout and sold. When the item is sold, its ownership passes from the vendor to the retailer and the payment is split between the two. SBT<\/a> is also a business model and is technically considered a form of consignment trading. <\/p>\n\n\n\n

This model is increasingly popular amongst retailers and\nvendors alike because of the many benefits each party recognizes from its use.\nKeep reading to learn more about how it works, what the benefits are, and how\nto start using it if you aren\u2019t already.<\/p>\n\n\n\n

Keep reading to learn how brands can maximize the impact of spring resets and get on a path to success in 2021.<\/p>\n\n\n\n

How Can Scan-Based Trading Benefit Retailers and Vendors?<\/h2>\n\n\n\n

SBT is beneficial to all stakeholders in a few ways. Here are a few of the biggest \u201cwins.\u201d<\/p>\n\n\n\n

Benefit #1 – Faster Payments<\/h3>\n\n\n\n

Because the payment is split between retailer and vendor at the point of sale (POS), and not before or after, it allows both parties to avoid financing delays and frees up cash flow for both parties. Otherwise, vendors and retailers must negotiate inventory tracking, invoicing, and payment terms. Splitting the purchase at the POS saves valuable time and minimizes financial transactions.<\/p>\n\n\n\n

Benefit #2 \u2013 Aligning Supply & Demand<\/h3>\n\n\n\n

The ripple effects of aligning supply and demand more closely, across any industry, have proven to be wide-ranging. For starters, it ensures that neither the vendor nor the retailer will be stuck with excess inventory<\/a> in the retailer\u2019s system, which is costly to produce, store, and offload. It also solves the other side of the problem, which is running out of supplies before the demand is capped. When inventory is understocked, both parties risk losing out on that sale and it can even jeopardize customer relationships. SBT allows inventory to be monitored at the store level allowing a much leaner and more responsive supply chain.<\/p>\n\n\n\n

Benefit #3 (Retailer) \u2013 Decreased Labor & Storage Costs<\/h3>\n\n\n\n

SBT enables retailers to better plan for staffing and storage needs. They no longer have to hold the cost of the inventory, have to maintain inventory levels, or need to invest in additional labor to manage those products. Remember that retailers do not own SBT products so while they take up physical store space, there are no retail assets dedicated to moving them.<\/p>\n\n\n\n

Benefit #4 (Vendor) \u2013 POS Visibility<\/h3>\n\n\n\n

Data is gold and SBT can solve one of the biggest data challenges that vendors experience: insight into what happens at the store level. Because the vendor retains ownership of the inventory until it\u2019s swiped at the checkout counter, the vendor will receive store-level inventory data along with POS data at the time of sale. This gives them visibility at both the store and item levels. <\/p>\n\n\n\n

The result?<\/p>\n\n\n\n

Increased responsiveness, smarter product placement, and better product promotion, all leading to an enhanced customer experience.<\/p>\n\n\n\n

Benefit #5 \u2013 Strengthened Vendor\/Retailer Relationship<\/h3>\n\n\n\n

We\u2019d go so far as to claim that SBT can strengthen the\nrelationship between vendors and retailers, sometimes even leading to more favorable\npayment terms and less complex program agreements.<\/p>\n\n\n\n

Why?<\/p>\n\n\n\n

Because everyone loves when others make their lives easier. And the features that SBT offers allows both vendors and retailers to access the data and payments they need, while minimizing extraneous communication. The end result is a less process-intense relationship between the two parties because many of the potential bottlenecks in the system have been removed.<\/p>\n\n\n\n

Enough of the Pros of SBT, What\u2019s the Catch?<\/h2>\n\n\n\n

There is one downside to SBT: the retailer doesn\u2019t own the\ninventory and thus they do not allocate any in-store labor to service SBT\nproducts.<\/p>\n\n\n\n

This can sound like an enormous stumbling block but\nfortunately (and often surprisingly), this is an easy hurdle to jump.<\/p>\n\n\n\n

The answer?<\/p>\n\n\n\n

Retail merchandising representatives.<\/strong><\/p>\n\n\n\n

Merchandising reps manage inventory at a store level and regularly service SBT products, including re-stocking, removing damaged or discontinued items, and reporting inventory levels.<\/p>\n\n\n\n

How RMS Can Help Implement SBT and Maximize Sales<\/h2>\n\n\n\n

Here at Retail Merchandising Services (RMS), we\u2019re SBT\nexperts. We partner with vendors who use SBT and can come in and bring all the\nstaffing and industry knowledge needed to execute every step of the process.<\/p>\n\n\n\n

Our SBT services include:<\/p>\n\n\n\n