AboutJames E. Dion Expertise Most questions about trends in specialty retail, how customers are changing both in the US and Europe. Demographics for all countries as they relate to retail trends and issues. Store Operations, Buying and Merchandising.
Experience
Past/Present clients Microsoft, Harley-Davidson, Ritz-Carlton, Hummer, Ace Hardware, Coleman Spas, Aldo, Intel, Dell, Safeway, New Balance, IBM, Kodak, Bata International, Nortel Networks, Honey Baked Ham Co., Man Alive, Highsmith
B.S Chicago State University
M.S. Chicago State University
PhD (abd) Illinois Institute of Technology
Expert: James E. Dion Date: 1/12/2008 Subject: 6 Month Merchandising Plan / Open to Buy
Question I'm in the process of opening a childrens retail shop. I'm having some trouble completing my 6 month merchandising plan and open to buy, being that I do not know EOM or BOM where do I start for a new business, I know my first day Inventory and have projected sales but the formula: Monthly sales + EOM stock + Monthly markdowns - BOM = Retail purchases, is not working for a start up business, any suggestions?
Answer Julie, Your EOM is decided by you based on what inventory turn number you are trying to achieve. Four would be best for a start up. The real problem is your sales forecast, that is the hardest for a startup to project. Do your best at the forecast and don't be afraid to change your OTB plan in the middle of the month if sales are higher or lower than you forecast. Even when you have a year of business under your belt, sales forecasting will still be one of the more difficult things you will do.
