top of page
Trade Allowance
Definition
A discount or financial incentive that a manufacturer provides to a retailer or distributor to encourage promotional activity, expanded distribution, or increased purchasing. Trade allowances may support price reductions, features, displays, or temporary volume-building programs.
How It's Calculated
Varies by program (e.g., per-case allowance, percentage discount, lump-sum payment).
Example
A cereal manufacturer offers a $3-per-case trade allowance to Walmart to support a two-week feature and display program.
Can't find what you're looking for? Suggest a term.
bottom of page