While that title sounds repetitive, it is certainly true. Here’s what a popular retail resource says about open to buy on their web site: “ You start with your planned sales for a given period of time, factor in the inventory levels you expect to have at the beginning and end of that period, and then account for markdowns”.
OK, planned sales are certainly important since they are the basis of your business, but then it goes wrong since the retailer is not the determiner of inventory levels, the open to buy plan does that based on sales and TURNOVER. The idea of accounting for markdowns is also wrong since markdowns reduce the amount of dollars available for sale and when built into the open to buy plan, they increase buying which creates more markdowns. The goal of a good open to buy plan should be to reduce markdowns to zero and increase turnover.
A retailer trying to determine beginning or ending inventory levels basically negates the value of the open to buy plan. Since turnover is the key to retail profitability, planned sales and turnover will determine beginning inventory and then your buying plan.
But wait there’s more! There needs to be adjustments to the turn rates based on the sales impact of each month and the OTB Calculations need to be made more than once to avoid negative OTB amounts. So, the details make the difference and there’s only one open to buy system that covers all the bases to give you the most accurate buying plan available.
myotbplan.com is the best open to buy system available! It’s easier, more accurate, more accessible, better supported, the only one that’s guaranteed and has no contract. You have nothing to lose and so much to gain. Call 310-829-5148 today with your questions at or just fill out the no obligation Subscribe form online and we’ll call you. Why wait?
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