Five Minute Friday: How Much Inventory Should You REALLY Have? | Open to Buy Planning Explained

In this episode of Five Minute Friday, we’re answering another frequently asked question from retailers and small business owners: How much inventory should I really have on hand?

It’s one of the biggest challenges boutique owners face—and getting it wrong can tie up your cash flow, leave you with dead stock, or cost you sales when you don’t have enough on the floor. In this episode, Sarah from The Boutique Hub breaks down the science of buying inventory using an Open to Buy Plan, so you can stop guessing and start investing wisely.

🔑 Key Takeaways:

Why There’s No Easy Button

• Inventory decisions depend on seasonality, customer demand, and your current stock.

• Buying inventory is an investment, not guesswork.

The 5 Reports You Need

• Sales, discounts, on-hand inventory, receipts, and on-order commitments.

• Run these reports by category (denim, sweaters, accessories, etc.) for accuracy.

How an Open to Buy Plan Works

• Use your reports to calculate planned sales, markdowns, and ending inventory.

• Apply the formula by classification to forecast exactly how much to buy.

Avoid Overbuying & Underspending

• Too much inventory kills cash flow.

• Too little inventory means missed opportunities.

• Finding balance protects profit and positions your store for growth.

Not a member yet? These are the kinds of retail strategies waiting for you inside The Hub to help you grow smarter.

👉 Want more? Join The Boutique Hub: https://tbhub.co/podcastjoin