Open-to-Buy (OTB)

The dollar amount of merchandise that a retailer can order for a particular period. Interim open-to-buy is calculated by subtracting the amount of merchandise already received and the amount of purchase orders planned for delivery within the period from the period’s planned purchases. Formula: OTB (retail) = Planned Sales + Planned Markdowns + Planned End of Month Inventory – Planned Beginning of Month Inventory