One year, when I was presenting a seminar on the need, benefits and workings of an open to buy system, about half way through my presentation, a woman raised her hand. “Isn’t there a simple formula like A + B + C that would equal your open to buy?”
“Well”, I explained, “if that were true, I wouldn’t be here and you would easily have your buying plan!”
The truth is that to create a proper open to buy plan necessitates taking into account more variables than A + B + C. Consider that a specialty retailer would have from 20 to 30 (or more) merchandise categories. Sales in each of these categories must be divided into 12 months with consideration that sales in most months will be different because of weather, special events, tourism, etc. So, you can see that it’s beginning to get complicated.
Add to the above the most important variable of all: turnover. Each department of merchandise will turn at a different rate and each month within that department will turn at a different rate. Consequently, that annual turn rate for each department must be adjusted to reflect the sales impact of each month so that projected inventories are correct to support projected sales.
When the open to buy calculations are done to bring the above information to a buying plan, there has to be the ability to locate and remove any negative open to buy amounts. In addition, the open to buy figures are not really for the month indicated, but are “receiving” figures for the current month that are going to build the beginning inventory for the next month.
So, that’s why there’s no A + B + C = OTB. But if you are looking for easy and accurate, look no farther. MYOTBPLAN.COM will guide you step by step to build your buying plan in the easiest, most accurate way possible. The program is sequential and you will see your plan take shape is a very short time. You will see where your current inventory and your future orders are out of balance and be able to take action to bring them into line. You’ll have a solid buying plan that will enable you to go to market with the confidence that you will be buying the right quantities. With a specific dollar plan, you will be forced to make better item selections insuring better sellers.
Basically, working with MYOTBPLAN.COM is as easy as A, B, C.