Buyers are responsible for maximizing financial returns for their company, and they are judged accordingly. In order to reach optimal financial returns, companies tend to minimize capital invested and maximize cash flow earned. In retail, inventory is the key capital investment, and operating profit from sales is the key source of cash flow. In order to maximize financial returns, buyers typically create a merchandise plan for a one or two quarter period. This plan helps plan the amount of inventory needed for a forecasted level of sales. Ideally the plan will minimize markdowns and maximize sales and inventory turnover. A brand’s product may be in high-demand, but if the brand can’t meet the buyer’s cost and inventory targets, the buyer will likely pass.

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