Scan-Based Trading Offers Retailers the Flexibility to Respond Quickly to Changing Customer Demand
Retailers are under constant pressure to balance maintaining adequate stock levels with minimizing the financial burden of unsold inventory. This challenge has become even more critical in a fast-paced retail environment shaped by omnichannel demand and fluctuating customer preferences. To navigate this complexity, many retailers, including Walmart, Target, and Walgreens, are turning more to scan-based trading (SBT).
SBT is a consignment-style inventory model where suppliers retain ownership of products until they are sold at the point of sale. This shift in inventory management reduces the financial risk for retailers, enabling them to focus on responding quickly to changes in customer demand while optimizing their inventory strategies.
Optimizing Inventory With Real-Time Responsiveness
Inventory management remains a cornerstone of retail profitability. Overstocking ties up capital and storage space, while understocking leads to missed sales and dissatisfied customers. SBT provides a flexible framework that allows retailers to adapt their inventory in real time, ensuring high-demand items are always available.
For brick-and-mortar locations, this responsiveness can offer a competitive edge over e-commerce competitors by mitigating one of physical stores’ primary challenges: inconsistent stock levels. According to a 2023 report from global research and advisory firm IHL Group, the total cost to retailers for overstocks and out-of-stocks amounted to $349 billion in lost sales for the U.S.
By leveraging SBT, retailers can more effectively align their in-store inventory with evolving customer preferences, ensuring popular items are consistently on shelves.
Flexible Product Offerings and Seasonal Agility
One of the key advantages of SBT is the flexibility it provides in adjusting product offerings without significant financial risk. Because retailers do not pay for products until they are sold, they can experiment with new items, adjust inventory for seasonal trends, or pivot quickly based on consumer demand.
For example, during holiday seasons, retailers can introduce a wider variety of seasonal products such as greeting cards, decorations, or specialty foods. Unsold inventory at the season’s end doesn't burden retailers with losses, as only items scanned at checkout are purchased from the supplier. This flexibility empowers retailers to curate more dynamic and relevant product assortments throughout the year.
Leveraging Real-Time Data for Strategic Decisions
Access to real-time point-of-sale (POS) data is another significant benefit of SBT. Detailed insights into sales patterns and inventory movement allow both retailers and suppliers to make data-driven decisions. Retailers can use this data to refine product selection, adjust pricing strategies, and launch targeted promotions that drive customer loyalty and boost store traffic.
Suppliers, in turn, can use this granular data to adjust production schedules, optimize logistics, and ensure timely restocking of in-demand items. This collaborative approach enhances the overall supply chain's efficiency, ensuring products meet customer demand without delays or shortages.
Strengthening Retailer-Supplier Relationships
SBT fosters greater transparency and collaboration between retailers and suppliers. Traditionally, suppliers relied on delayed or incomplete sales data to make production and distribution decisions. With SBT, they gain access to real-time POS insights, allowing them to respond proactively to market trends and customer preferences.
This transparency facilitates a partnership where both parties work together to optimize stock levels, refine product assortments, and plan more effective promotions. By aligning their strategies, retailers and suppliers can better anticipate customer needs, strengthening their ability to adapt quickly to shifts in the market.
As the retail industry continues to evolve, the ability to respond quickly to changing customer demand has become a critical success factor. Retailers have turned to SBT as a solution that supports this agility by reducing inventory risk, optimizing stock levels, and collaborating more effectively with suppliers. Through the use of real-time data and flexible inventory strategies, retailers can provide a more dynamic shopping experience that meets customer expectations. In a competitive market where adaptability is key, SBT can be a valuable tool for retailers to remain agile, efficient and customer-focused.
Mark Landgren is senior vice president of Financial Information Technologies, LLC (Fintech), an accounts payable (AP) automation technology provider for the hospitality and retail industries.
Related story: Supplier Diversification, AI Readiness, and Circularity Top Supply Chain Priorities for 2025

Mark Landgren is the senior vice president leading the Scan-Based Trading (SBT) division at Financial Information Technologies, LLC (Fintech). In his role, he oversees SBT solutions impacting over 90,000 retail locations throughout North America. Before joining Fintech, Mark was the CEO of Nexxus Group for more than a decade, transforming the company into the largest third-party SBT provider in the U.S. until its acquisition by Fintech. His career spans senior leadership positions in legal, finance, and operations across various sectors, and he is also a co-founder of the Legacy Headwear brand, now L2 Brands.