Open To Buy Definition Apr 2026

The target stock level for the end of the period. Why Retailers Use It

What is Open-to-Buy (OTB)? Definition, Meaning & Examples - Board open to buy definition

Helps identify slow-moving inventory, allowing for faster stock rotation. The target stock level for the end of the period

is a financial budget and retail planning process that calculates the amount of merchandise a retailer can purchase within a specific timeframe. It acts as a guardrail to ensure businesses remain within their financial goals while maintaining enough stock to meet customer demand. Key Components of OTB open to buy definition

While specific variations exist, the fundamental logic behind OTB is:

Prevents over-committing capital by buying too much stock.