: Prevents tying up cash in slow-moving items, which can hurt cash flow.
OTB=(Planned Sales+Planned Markdowns+Planned End-of-Month Inventory)−Planned Beginning-of-Month Inventorycap O cap T cap B equals open paren Planned Sales plus Planned Markdowns plus Planned End-of-Month Inventory close paren minus Planned Beginning-of-Month Inventory : The total revenue expected for the period.
Retailers may track OTB in different ways depending on their specific needs: open to buy
Retailers typically use a basic formula to determine their available budget (often calculated in retail dollars):
The primary goal of OTB planning is to maintain the right inventory balance. : Prevents tying up cash in slow-moving items,
: Ensures popular items remain available for customers to prevent lost sales.
In a personal finance context, "open to buy" can also refer to the on a consumer account, such as a Sam's Club credit card. It represents the amount of credit remaining that the cardholder can use for new purchases. [Video] Open to Buy Explained + Template Walkthrough : Ensures popular items remain available for customers
: The target value of stock you want to have left over to start the next period.
: Prevents tying up cash in slow-moving items, which can hurt cash flow.
OTB=(Planned Sales+Planned Markdowns+Planned End-of-Month Inventory)−Planned Beginning-of-Month Inventorycap O cap T cap B equals open paren Planned Sales plus Planned Markdowns plus Planned End-of-Month Inventory close paren minus Planned Beginning-of-Month Inventory : The total revenue expected for the period.
Retailers may track OTB in different ways depending on their specific needs:
Retailers typically use a basic formula to determine their available budget (often calculated in retail dollars):
The primary goal of OTB planning is to maintain the right inventory balance.
: Ensures popular items remain available for customers to prevent lost sales.
In a personal finance context, "open to buy" can also refer to the on a consumer account, such as a Sam's Club credit card. It represents the amount of credit remaining that the cardholder can use for new purchases. [Video] Open to Buy Explained + Template Walkthrough
: The target value of stock you want to have left over to start the next period.