Open-to-Buy is a tool that helps retailers plan purchases and monitor stock more precisely.
By replenishing the right amount of stock at the right time, you can avoid out-of-stock and lost-sales situations, while also optimizing the profit margins. With the combination of the actual purchase data and a sales budget, the Open-to-Buy value can be calculated and with that you can identify how much stock still needs to be purchased to be able to fulfill a sales budget across a defined period.
The Open-to-Buy tool lets you create different Open-to-Buy Views by defining the fields that you wish to view, formulate, and analyze. The default Open-to-Buy value is calculated using this formula:
Sales Budget Amount (Cost)
+ Discounts (Planned)
+ Closing Stock Value (Planned)
+ Negative Adjustment (Planned)
- Purchases
- Purchases (Committed)
- Opening Stock Value
-------------------------------------------------
= Open-to-Buy
The calculated Open-to-Buy value will tell you how much stock is needed within a period, given that the value of stock at the end of the period should not exceed a certain value.
Additionally, once the Open-to-Buy value for a sales budget is calculated, the Open-to-Buy Checks function can be used in Purchase Orders or Allocation Plans to check and update their Open-to-Buy Status. The checking indicates if the Purchase Order can be released or if the Purchase Order can be created via the Allocation Plan without exceeding the Open-to-Buy values of the related sales budgets.
If there are any violations, the details of the violations will be prompted, allowing you to make a well-informed decision before proceeding to create or release a Purchase Order.
Note: In order to keep the Open-to-Buy meaningful, it is important to ensure that the budgets are updated.
| To | See |
|---|---|
| Set up Open-to-Buy View. | How to: Set Up an Open-to-Buy View |
| View Retail Sales Budget in Open-to-Buy View. | How to: View Retail Sales Budgets in Open-to-Buy View |
| Schedule the Calculation of Open-to-Buy. | How to: Schedule the Calculation of Open-to-Buy |
| Perform Open-to-Buy Checks on Purchase Order. | How to: Perform Open-to-Buy Checks on Purchase Orders |
| Perform Open-to-Buy Checks on Allocation Plan. | How to: Perform Open-to-Buy Checks on Allocation Plans |
See Also