What is open-to-buy planning in fashion? Why fashion buying rarely follows the plan

If you’ve ever spent even a month in the world of buying in fashion, you’ll know the process looks more certain on paper than it does in reality. Range reviews, category allocations, supplier capacity, margin targets and demand assumptions are planned and signed off… only for them to drift a few months later. The plan wasn’t wrong per se, but the decisions within it weren’t final.

A wholesale order book may have developed differently than expected, a customer’s colour preferences might have shifted, or your freight costs could have fluctuated.

This doesn’t necessarily mean something went wrong. It’s normal for fashion planners to work with incomplete information for most of the buying cycle; the reason it feels like the opposite is because most planning processes assume you *should* know everything upfront.

Why fashion buying becomes harder when decisions are fixed too early

The issue is tied to systems as much as to processes, since they govern how teams operate within their businesses. An ERP system, for instance, frequently expects someone to commit in full in one event. The process that follows is rigid:

Decide what inventory to purchase; create a purchase order; move into execution.

No fashion company wants to work that way, though. Until demand can be gauged properly, supplier capacity is known, and allocations have been made, it is much more sensible to progressively purchase materials and items in appropriate stages.

This is where open-to-buy planning (OTB) typically enters the conversation. Originally used as a budgetary process to control inventory, OTB naturally aligned with the way fashion buying actually works: preserving flexibility while reducing inventory risk through approaches like step-wise buying.

OTB became popular precisely because it naturally worked in tandem with the fact that buying decisions become clearer over time, while the cost of committing early can remain hidden until later. This matters because brands constantly balance multiple sources of exposure at once.

(Think: inventory risk, working capital pressure, supplier commitments, demand changes.)

Buyers do not simply decide how much stock to purchase; they make a series of decisions on what they know is categorically confirmed and on what will become clearer later.

Core products with established demand patterns, for instance, are usually easier to lock in earlier in the cycle, while staple materials and never-out-of-stock pieces often sell well enough to justify securing supply in advance.

It’s more difficult, however, to estimate sales performance on trend-led products, seasonal ranges, and anything else that requires signals from the market to understand demand.

Consider your preparation for Autumn/Winter. Reserving fabric capacity and securing production slots months ahead might feel sensible, but that doesn’t mean colourways, size ratios, or assortment depth should be fixed at the same time.

Wholesale preorders may still be developing, comparable products could reveal new demand signals, and supplier timelines can continue to move. Decisions that once looked unclear earlier in the cycle suddenly become easier to make now that the information has caught up.

How fashion brands reduce inventory risk without committing too early

The core principle behind staged buying is not to forecast perfectly because seldom will a brand ever truly know how much product it will sell. It is more concerned with understanding which decisions will benefit from early commitment and which will be easier to get right if they remain flexible for longer.

Step-wise buying is a natural result of this line of thinking. Rather than treating purchasing as a single act, commitments happen progressively the more a company knows. Early decisions are made to secure core fabrics, reserve supplier capacity, and protect essential materials. Decisions with more variability are purposefully left open until better signals emerge.

This isn’t to say that step-wise buying is a means to delay decision-making or slow processes, but to preserve the ability to make better decisions when better information exists.

The most notable impact shows up in inventory, but that is only part of the equation. One of the lesser talked about elements of planning in fashion is the human side. Planning processes that demand certainty before it exists often lead to teams compensating elsewhere.

Assortment changes may get moved to spreadsheets, or procurement might work from one plan while merchandising adjusts another. Conversations tend to happen outside of the core system rather than within it, creating duplicate work and unintended bottlenecks that stifle plans.

It’s worth noting, however, that teams do not set out to work this way. More often than not, the system’s environment is designed for stable commitment models which do not exist in fashion.

Over time, the consequences accumulate quickly as forecasts drift between departments, landed cost changes hit finance later than expected, and inventory exposure becomes harder to see clearly while working capital gets tied up in the wrong places.

This is why both OTB and step-wise buying work best inside a connected planning process. Because even one buying decision can impact sourcing, allocation, inventory, and finance at the same time, it’s imperative that each department can immediately see a change in the plan.

Should a freight cost increase, finance must be able to adjust the margin assumption. In the same way, if demand changes, replenishment plans and inventory exposure should be changed accordingly.

Every core planning capability – rolling forecasts, phased purchasing commitments, scenario modelling, cost visibility – supports this process because they allow plans to change as assumptions change, and each one of them supports the purpose of OTB.

How K3 Fashion supports open-to-buy planning

While most fashion organisations understand the principles behind OTB, putting them into practice becomes harder as ranges expand, seasons overlap, and decisions become more interconnected.

K3 Fashion supports operational processes such as phased purchasing and connected planning directly within D365 Finance and Supply Chain Management, allowing teams to adapt their decisions as assumptions change and stronger information becomes available.

If you’d like to find out more about K3 Fashion, feel free to drop us a line today.