Open to Buy and POS Software
Understanding your business climate and the changes revolving in it are essential to continued growth. Maximizing profits can be obtained by changing as your demographics change. A small retailer cannot be everything to everybody and targeting niche markets is a must for survival. Baby Boomers are now becoming senior citizens and the same product lines and spending patterns you were accustomed to buying for are frequently changing. You can only make informed buying decisions based on a plan that is constantly evolving using information obtained with POS software that captures everything at the inception of the sale. This information is then seamlessly run through your retail stock ledger, departmental comparatives and open to buy planning. Identifying your clienteles likes and dislikes, work habits and lifestyle changes will make your buying patterns target your customer’s needs.
Your buying budget should reflect the demographics of your clients and their buying habits. Your open to buy plan will target your customer’s needs and as their preferences change, so should your open to buy plan. This plan cannot be static, but always a work in progress reflecting the changes in your business. You must monitor your profitability by department, class and vendor performance to give you a maximum return on your investment. Develop your plan from past history obtained from your POS software and educated information from your best performing vendors. If you find one of your vendors have product that gives you better turns, sell through and an increased gross return on investment, use their past experience in making and revising your open to buy plan.