Sell-through and open-to-buy: measuring what your stockists really sell

A brand can post a record selling campaign and lose half its stockists the following season. Picture the scene: the orders came in, the deliveries left on time, but the pieces stayed on the rail. The store marks them down, remembers the collection badly and cuts its budget at the next appointment.

Selling to retailers is not enough: the products have to leave the shop floor. Three metrics let you track that and manage a network of stockists.

Sell-in, sell-out, sell-through: three complementary measures

Sell-in shows up in the brand’s orders. Sell-out shows up in the stores' tills. Sell-through, also called the sell-through rate, links the two: it tells you what share of what the store received has found a buyer.

These terms, along with the other key concepts of the trade, are covered in our wholesale glossary.

How do you calculate the sell-through of a style?

Sell-through is calculated per style, per category or for the whole collection, over a given period. The usual window is the first few weeks after delivery, at full price.

Example: a boutique receives 40 pieces of a style and sells 26 of them at full price in eight weeks. Its sell-through is 26 ÷ 40 = 65%.

Methods vary from one retailer to another. Some calculate sell-through by value rather than by units, others measure sales against available stock rather than receipts alone. Before comparing two figures, check that they are calculated the same way.

A sell-through rate is read by comparison

The figure on its own says little: the comparison is what tells the story. Compare styles with one another, stores with one another, and one season with the last.

A style at 80% after six weeks, i.e. 32 pieces sold out of 40 in our boutique, calls for a reorder. A style at 20% at the same point, i.e. 8 pieces out of 40, signals a markdown, and often a store that will order less next season.

Stock cover tells you when to offer a reorder

Back to the example: 14 pieces remain in store, and the style has sold at an average of 3.25 pieces a week (26 pieces in eight weeks). Cover is 14 ÷ 3.25, or just over four weeks (4.3 weeks).

If the next delivery is due in eight weeks, the rail will be empty before then. This is the moment to offer an in-season reorder.

Open-to-buy: calculating your buyer’s purchasing budget

Open-to-buy (OTB) is the amount a buyer can still commit over a period. The standard retail formula: planned sales + planned markdowns + target closing stock − opening stock. The logic is simple: the store must buy enough to sell, enough to absorb its markdowns and enough to end the season with the stock it wants, minus what it already holds.

• Example, at retail value excluding VAT: a boutique plans €30,000 of sales for the season and €3,000 of markdowns, and wants to end with €12,000 of stock; it has €15,000 at the start of the season.
• Its purchasing budget is 30,000 + 3,000 + 12,000 − 15,000 = €30,000, expressed at retail value excluding VAT.
• To convert it to wholesale prices, divide by the store’s pre-tax multiplier: with a pre-tax multiplier of 2, that represents €15,000 of purchases at wholesale prices, across all brands.
• Finally, deduct what has already been ordered elsewhere: the remainder is what is up for grabs at the appointment.

Knowing a buyer’s budget, even roughly, changes how you prepare an appointment. The proposal is calibrated, the selection realistic, and the conversation is about which styles to choose rather than how much to spend. On the link between multiplier and wholesale price, see how to calculate your wholesale price.

How to get sell-out data from independent boutiques

Sell-in is in your orders; sell-out sits with your retailers. Large retailers often send sales reports, independent boutiques rarely do so unprompted. A few habits are nonetheless enough to get the essentials:

• Ask for sales and remaining stock at each checkpoint: four weeks after delivery, then mid-season.
• Ask two simple questions at appointments: what sold first, and what is left?
• Track reorders: a customer who reorders a style is giving you valuable sell-through information.
• Share back what you see across the whole network: the best sellers, the combinations that work.

What sell-through changes for the brand

1. Reorders offered at the right moment, before stock runs out, rather than on request when it is too late.
2. Appointments prepared with the customer’s history and budget, at a trade show as in the showroom.
3. Better-informed collection decisions: the styles that sell through in store, not just the ones that get ordered.
4. Early warning on customers in difficulty: weak sell-through often comes before late payments, which well-set deposit and payment terms help to contain.

One method, two measurement dates

Start by fixing a single calculation method, in units, on receipts, at full price, and the measurement dates: four weeks after delivery, then mid-season. Ask your main stores for these figures on both dates, and calculate sell-through and stock cover for each style. Offer reorders wherever cover falls below the delivery lead time. Before the next campaign, estimate each customer’s open-to-buy and prepare a selection that fits within that budget.