Understanding Open To Buy

Updated: Nov 21

Different items of inventory require different solutions. Let's say you are Home Depot or a Grocery Store. These businesses reorder the same item over & over. Hammers and Nails, Paint, Lumber, Breakfast Cereal, Milk, Frozen Pizza, etc. etc. On the other hand, Nordstrom, Macys, JC Penny need a different approach because their items are both seasonal (spring, summer, fall) and fashion orientated (spring has different colors styles and designers) and that can change when you get to fall. So, businesses in the second group have developed a system to deal with this, and it is called Open to Buy. Basically, Open to Buy dictates how much you can spend by season, within a certain department.

Fortunately, one of the partners at RWS Information Systems is an expert at Open to Buy. She will provide her insight on this topic.