The Retail Stocks

The retailers’ main offering are their stocks or inventory. Good inventory control is, therefore, crucial for the business. It ensures that there is an adequate supply of merchandise in response to sales. As mentioned in one of the pages, one of a retailer’s frustrations is not having the goods that customers want, or not having enough. Similarly, a retailer must avoid carrying the wrong type of inventory.

Retail Stocks

All these instances equal lost sales opportunities. An open-to-buy (OTB) plan will guarantee that a retailer stocks the right kind and volume of goods. OTB can be calculated either in units or cash value. It is basically the difference between how much inventory is needed and how much is available for sale (including inventory on hand, in transit, and outstanding orders). As the business grows, a retailer will pretty much have an idea of what specific merchandise are highly saleable and how much of them are actually sold out. During the next sale period (month), the retailer will know what and how much to order from suppliers.

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