In today’s retail business, a mistake in inventory planning can lead to overstocking or understocking, which can quickly trigger significant cash flow problems and operational bottlenecks.

Against a backdrop of rising costs, declining consumer demand, and persistent supply chain volatility, cash flow miscalculations can prove to be a fatal mistake for retailers and growing fashion brands alike.

The Role of Open-to-Buy in Modern Retail

The key to navigating these challenges is planning inventory accurately and purchasing exactly the right amount of raw materials and finished goods to meet actual market demand. That is where Open-to-Buy (OTB) planning comes in.

An effective OTB plan starts with your projected sales targets for the upcoming months, factoring in current stock levels, open purchase orders, and scheduled deliveries. This ensures you maintain optimal inventory on hand to hit your revenue goals without tying up vital working capital in stagnant stock.

Flexibility and Precision in Inventory Management

OTB takes into account how much of a particular product—or an entire product range—you currently have in stock versus what is required in the pipeline. Advanced analytics and planning functionality mean that OTB can be utilized with total flexibility to adapt dynamically to your business model.

Here we show you with just a couple of screenshots how our platform, Look Cloud Fashion Platform, provides the exact visibility and data needed to make your merchandising planning as precise as possible: