Explainer
Open-to-buy planning
Open-to-buy is the amount a buyer can still commit in a period after accounting for what is planned to sell, what is already on order, and where inventory needs to end. It is arithmetic, and it is also the discipline that separates buyers who can act from buyers who can only react.
By The Retail Ledger · September 27, 2026
The calculation
Planned closing inventory plus planned sales and planned markdowns, less opening inventory and merchandise already on order, gives what remains available to commit. Run monthly, it tells a buyer exactly how much room is left before the plan breaks.
The number is only as good as the sales plan behind it, which is why a buyer who consistently over-plans sales will consistently believe it has room it does not have.
Why keeping room open is valuable
Opportunities appear mid-season: a vendor cancellation, a closeout, a competitor's exit. A buyer with no open-to-buy cannot take any of them at any price. This is the structural advantage the off-price model is built on, as described in how off-price buyers buy.
How it fails
Two common ways. Committing the whole budget early against an optimistic plan, which leaves nothing for the second half of the season. And treating open-to-buy as a target to be spent rather than a limit, which converts a control into a mandate to buy.
Questions
What does open-to-buy mean?
The amount of purchasing budget still available to commit in a period after planned sales, planned markdowns, existing inventory and outstanding orders are accounted for.
Is open-to-buy the same as a budget?
It is the remaining, uncommitted portion of one, recalculated as conditions change.
Why do off-price retailers protect it?
Because their model depends on being able to act when a seller needs to move goods quickly.
Related: markdown cadence.