Open-to-buy is the planned amount of inventory a retailer or apparel brand can purchase for a period after considering sales, markdowns, beginning inventory, ending inventory, and receipts.

Is OTB the same as a buy plan?

No. OTB sets the financial buying capacity, while a buy plan translates that capacity into products, quantities, timing, channels, and vendors.

Can I manage OTB in Excel?

Yes, especially at smaller scale. Excel becomes harder when OTB must stay connected to assortment changes, purchase orders, receipts, markdowns, and production delays.

// Tools

Open-to-buy (OTB) calculator

Open-to-buy is the retail dollars you can still receive in a period without exceeding the plan. It is calculated as planned EOM stock + planned sales + planned markdowns − beginning stock − merchandise on order.

Enter your figures below to see your OTB and whether you are overbought.

Definition

Open-to-buy (OTB) is the inventory still purchasable for a period after accounting for sales, markdowns, beginning and ending inventory, and receipts already on order. It is the retail dollars you can still receive without exceeding the plan.

Definition — Open-to-buy (OTB): Open-to-buy sets the financial buying capacity for a period. It tells a buyer how much more inventory can still be received once planned sales, markdowns, beginning and ending stock, and on-order receipts are accounted for — a negative result means the period is overbought. OTB is the budget; a buy plan turns it into styles, quantities, and timing.; OTB = planned EOM stock + planned sales + planned markdowns − BOM stock − merchandise on order; Used by: Buyers, merchandise planners, merchandise financial planners; Related: Buy planning, WSSI, weeks of supply, sell-through, gross margin

// Who this is for

Buyers and merchandise planners managing intake budgets across months and channels for D2C and wholesale apparel.

// When to use it

Use it before committing a buy, mid-month as receipts land and POs change, and whenever the sales or markdown plan is revised.

// When a spreadsheet is no longer enough

Spreadsheets are useful when the process is small and controlled. They become risky when multiple teams need the same version of the plan, when assumptions change frequently, or when decisions must flow into POs, production, and allocation.

Planned sales (retail $)

Planned markdowns / reductions ($)

Planned end-of-month stock ($)

Beginning-of-month stock ($)

Merchandise already on order ($)

Enter the planned figures to see your open-to-buy.

// Reading your result

What this result means

A positive OTB means you have available buying capacity for the period, assuming sales, markdown, inventory, and receipt assumptions are accurate.

A negative OTB means you may be overbought for this period or carrying too much inventory relative to plan. Check open POs, receipts, markdown assumptions, and sales forecast.

What to check next

Open POs and receipts not yet logged
Markdown and reduction assumptions
Sales forecast vs. actual run rate
Beginning and planned ending stock

Where spreadsheets usually break

Recalculating OTB across channels and months by hand is where the number drifts — a spreadsheet does not update itself as receipts land and POs change, so the figure you buy against is often already stale.

How RetailNorthstar helps

RetailNorthstar keeps OTB, assortment, buy plan, purchase orders, and production status connected so teams are not reconciling the plan manually.

See connected OTB workflow →

// What negative OTB means

A negative open-to-buy is not an error — it is a signal. It means your planned ending stock, sales, and markdowns no longer leave room for the inventory you have already committed. In other words, you are overbought for the period, or carrying more stock than the plan supports.

Before reacting, confirm the inputs are real. The most common cause of a surprise negative OTB is on-order that has crept up — purchase orders placed against an earlier, more optimistic sales plan. Re-check the sales forecast against the actual run rate, the markdown assumptions, and whether every open PO and receipt is accounted for. If the inputs hold, the practical levers are cancelling or pushing back on-order, accelerating markdowns to clear stock, or shifting receipts to a later period.

For the formulas behind each input, see the retail math formulas guide and how OTB relates to the weekly stock view in OTB vs. WSSI.

// Common OTB mistakes

Leaving on-order out. OTB that ignores merchandise already committed will overstate how much you can still buy.
Stale sales plans. Buying against a forecast that the actual run rate has already overtaken is the fastest route to an overbought position.
Forgetting markdowns and reductions. Planned reductions consume inventory dollars; omit them and OTB reads too high.
Mixing OTB with the buy plan. OTB sets the budget; the actual buy plan turns it into styles, quantities, and timing. Conflating the two hides where the capacity is going.
Calculating once. OTB drifts as receipts land and POs change; a number checked at the start of the month is not the number you have mid-month.

// How to move from spreadsheet OTB to connected planning

A spreadsheet is a fine place to start. Download the free OTB template for a 6-month worksheet, and use the retail math formulas to wire up the inputs. It works until OTB has to stay in step with everything around it.

The break point is connection, not calculation. When OTB must reflect live assortment changes, open purchase orders, receipts, markdowns, and production delays at once, reconciling it by hand across channels and months stops scaling. That is where a connected plan earns its keep: RetailNorthstar keeps OTB, the buy plan, assortment, purchase orders, and production status on the same source of truth, so the number you buy against is current. For how the weekly stock view ties in, read OTB vs. WSSI.

// FAQ

Frequently asked questions

What is open-to-buy?: Open-to-buy is the planned amount of inventory a retailer or apparel brand can purchase for a period after considering sales, markdowns, beginning inventory, ending inventory, and receipts.
Is OTB the same as a buy plan?: No. OTB sets the financial buying capacity, while a buy plan translates that capacity into products, quantities, timing, channels, and vendors.
Can I manage OTB in Excel?: Yes, especially at smaller scale. Excel becomes harder when OTB must stay connected to assortment changes, purchase orders, receipts, markdowns, and production delays.

// How it works

01
Enter planned sales and markdowns
The sales and reductions you plan for the period, at retail.
02
Enter planned EOM and BOM stock
Planned end-of-month stock and the beginning-of-month stock you start with.
03
Enter merchandise on order
Anything already committed but not yet received.
04
Read the OTB
OTB = planned EOM + planned sales + planned markdowns − BOM − on order. A negative result means you are overbought.

Planning a whole season? Download the free OTB template for a 6-month worksheet. Recalculating OTB across channels and months in a spreadsheet is where errors creep in — RetailNorthstar reconciles open-to-buy automatically as the plan and receipts change; see more retail tools.

Book a Demo →See it on RetailNorthstar →

// Summary

Open-to-buy is the inventory still purchasable for a period after sales, markdowns, beginning/ending inventory, and receipts.
OTB = planned EOM stock + planned sales + planned markdowns − BOM stock − merchandise on order.
A negative OTB signals an overbought position; OTB sets the budget while the buy plan spends it.
OTB drifts as receipts land and POs change, so it needs recalculating through the period, not once.
RetailNorthstar keeps OTB, assortment, buy plan, purchase orders, and production status on one source of truth.

// Related resources

See the connected workflow in RetailNorthstar →