Your merch plan will never tie to your SKU plan.

So what is "tops-down"?

It sounds vague, and people assume it means one plan at total product level. It could. It usually shouldn't.

Tops-down plans belong at hierarchy levels that share seasonality, end use, AIR and AUC. If a single style carries a big chunk of sales penetration, that's a perfectly good level to plan at too, with the full metric set: inventory, sales, discounts, on order, GM%, turn, shrink.

Where it goes off the rails is when leadership pushes for merch plans at every level of the hierarchy and every level of time, down to SKU.

What the tops-down plan is actually for

Your tops-down plan — I call it the Merch Plan, or the OTB Plan — sets the guardrails. Plan sales against the trend, then let open-to-buy balance out to the weeks-on-hand, turn and inventory levels you need.

Now you have your receipts: cost, units and dollars, for a given timeframe. Core product runs on a replenishment or ladder system, so what's left over is your newness and fashion budget. That number is the guardrail. Everything below it is bottoms-up's problem.

Where bottoms-up takes over

Use your hindsight tools and current trends to build a quantifiable rate of sale by choice, based on full potential — strip out the forced markdowns, and strip out the stockouts caused by buys that were too thin in the first place — across the weeks you're actually buying for.

Do it by quarter or by month, so you know how many choices you need per delivery.

Turning sales into a buy

Roll that up and you have total receipt quantity, cost and retail. If it matches your tops-down OTB, you're in business.

Size falls out of it

Size level isn't ignored in any of this — it drops out of the same potential rate of sale. Fill in the stockouts, get a real read on the size curve, and you can break the buy down to size with confidence.

That's bottoms-up doing its actual job, rather than being asked to reconcile upward against a number it was never designed to produce.

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