Open – to – Buy Planning Online Training

Tuesday – March 2, 2021

11:00 AM – 1:00 PM Eastern Standard Time (New York)

(4:00 PM – 6:00 PM London (UK), 7:00 PM – 9:00 PM Dubai)

LIVE & INTERACTIVE

Recording & Slides will be sent to all registrants

WHAT IS OTB? – Advanced Inventory Planning Skills

Inventory purchase budget based on sales plan (Target)

Usually done at the category level, if necessary, you can drill down to sub-levels even down to SKU level

The open-to-buy formula will help you create forecasts for your OTB plan. The values in your open-to-buy are projections, so they may not be perfectly accurate. But a sensible way to check your numbers is if your actual month-end inventory is within 5% of your prediction.

OTB Formula:

- Start with Desired End of Month (EOM) inventory
- Sales and Markdowns
- Beginning of the Month (BOM) Inventory and On Order and Receipts
- =
- Open To Buy

Example:

The component that makes the open to buy calculations difficult is the fact that the end of month and markdown values are based on forecast. A good forecast requires excellent knowledge of the customer, market, store, competition and of course the product.

Part of creating an OTB budget involves planning inventory turnover. Turnover is a calculation that measures how fast you sell through inventory and need to replace it. The quicker a retailer “turns” their inventory, the more they’ll need to buy. Also, quicker turns mean much higher profitability as well.

Benefits of Open – To – Buy:

- Estimate in advance capital required for inventory

- Ensure right inventory levels for planned sales

- Control merchandise commitments

- Establish objectives so that actuals can be compared with

Provide opportunity for more profit

This webinar will show you the best ways to achieve proper inventory planning.

Every year, retailers go out of business primarily because their inventory is not properly managed. One of the biggest contributing factors to retail mismanagement is the lack of an OTB system. Take this webinar and you will be well on your way to retail health.

Register Here!