How to stop buying yourself broke

Have you ever felt like you’re buying inventory, selling it, then turning around to spend every dollar of profit right back on more stock? It can feel like you’re running hard but never actually getting ahead.

The good news? You can break free from this buy-sell-broke cycle and finally start building real profit. Let’s walk through four key steps that will help you turn seasonal surges into lasting profit.

1. Improve your inventory plan. Tourist-driven retail has unique rhythms. Your inventory should rise before peak season and taper as the crowds head home. If you’re buying based on instinct, you risk being overstocked. An open-to-buy plan acts like a budget for your inventory, aligning purchases with sales goals.

   
   

   "You can break free from this buy-sell-broke cycle and finally start building real profit."

   
   

2. Pay yourself first. It’s easy to let every dollar get swallowed by the next round of buying, but that’s why I recommend the Profit First method. Here’s a simple starting point: 50% of revenue goes to inventory; 10% of revenue goes to owner’s pay; 1% or more goes to profit; the rest is operating expenses. This way, you start a habit of building a profit year after year.

   
   

3. Don't go on autopilot. Just because something sold once doesn’t mean it always will. Before reordering, consider: Did this product drive profit, or just sales? Tourist dollars are precious, so don’t waste them on products that don’t serve your bottom line.

   
   

4. Identify essential items. Every store has core products that consistently sell and drive profit. These “never-out-ofs” should be your top 20 items by both units sold and revenue. Always keep these items well-stocked.