On many occasions, I’ve said to my customers and those attending my seminars that there are no OTB Police. But there should be.
Once you set up an open to buy plan (and every retailer should), you need to follow it. The temptations in the marketplace are too great if you don’t stick with your plan. And, of course, you don’t have to stick with your plan because there are no OTB Police. But there should be.
As you stray from your open to buy plan, you will buy the wrong quantities of great merchandise, and too much of a good thing is a bad thing. Once you have sold what you should have bought, you’ll be left with a lot of out of style (now) merchandise that is depreciating by the day. You can get yourself into this mess on a regular basis and change what should be a pleasurable, creative experience into a nightmare of markdowns and cash flow problems because there are no OTB Police. But there should be.
The first job of any OTB Officer is to make sure you install and maintain an open to buy plan. This plan will be based on your anticipated sales and desired turn rates – the two elements that drive your store. Your open to buy plan will develop a buying plan in each merchandise department for each month for the next 12 months so you know how much to buy. Following this plan you will always have the right amount of merchandise in each of your departments to support your sales, give you the turnover you seek and a positive cash flow.
Now comes the hard part – sticking with your plan. It takes a little work, but it’s well worth it as it will prevent problems and allow you to be creative in merchandising your store. At the shows, you’ll find reps that will encourage you to buy more. They’ll offer discounts, dating and all sorts of deals. But the only good deal is one that keeps your buying within your open to buy plan. Stray from your plan and you’re going to be in trouble. But in reality, you can do anything you like, because there are no OTB Police. But there should be.