In an open-to-buy plan, the sales estimates and the cost of goods estimates come from what other business management tool?

In an open-to-buy plan, the sales estimates and the cost of goods estimates come from what other business management tool?

• A. Annual Financial Forecasts
• B. Marketing Plan
• C. Inventory Trait Reports
• D. Supplier Credit Terms

Answer: (A)

Open-to-buy planning relies on predicted sales and the cost of goods to determine how much inventory to purchase. Those predictions come from annual financial forecasts, which project revenue and COGS for the upcoming period. A marketing plan can influence assumptions about demand, but it doesn’t provide the formal sales and cost projections used to size purchases. Inventory trait reports focus on stock characteristics rather than forecasted demand or costs, and supplier credit terms deal with payment timing, not sales or COGS estimates.

Open-to-buy planning relies on predicted sales and the cost of goods to determine how much inventory to purchase. Those predictions come from annual financial forecasts, which project revenue and COGS for the upcoming period. A marketing plan can influence assumptions about demand, but it doesn’t provide the formal sales and cost projections used to size purchases. Inventory trait reports focus on stock characteristics rather than forecasted demand or costs, and supplier credit terms deal with payment timing, not sales or COGS estimates.