The holidays are almost here and retailers are focused on making their stores as attractive as they can to bring in customers and sales.  Many are depending on these next two months to save their year.  But your focus should be on January for two important reasons

Many retailers go into the holidays overloaded with inventory because they don’t want to miss any possible sales.  More merchandise may indeed mean a few extra sales, but also many markdowns.  Too many markdowns will basically remove the profits generated by the holiday sales.

It’s not good enough to make sales.  You must make profit.  Your accountant may tell you how good things look on paper, but your profits are probably buried in excess inventory.  You can’t pay your bills with excess inventory!

So, your planning should not be solely about the holidays, but must look forward to starting January with the correct amount of inventory. You’ve been to the trade shows and have loaded up for November, December, and all of the new, exciting merchandise for spring and summer.  If you’re loaded with excess holiday merchandise when January rolls around, you’re in trouble.

How can you solve this problem? Setting up an open to buy plan will tell you where you stand with your current inventory in relation to your expected sales and if you are overbought for the future or have additional dollars to commit.  Open to buy guides your buying to support planned sales, achieve desired turnover, and a positive cash flow.

Open to buy needs to be in your future, and. In reality, in your present.  Now is the moment in your retail life to get on board with open to buy.  If you do, you’ll know in a few short hours if you inventory and your outstanding orders will leave you in a position to enjoy a happy new year.

Now is the time to prepare for January.  If you don’t, you may not be around to plan for the January after that.


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