Why Unrealistic Revenue Targets Break Retail Operations
Ambition is easy to say. It’s much harder to plan for.
Every year, around the same time, someone in a boardroom decides next year’s revenue goal. Usually, it’s a neat, round number. Fifty million. A hundred million. Half a billion if they’re feeling bold. It sounds confident when you say it out loud. It looks good on a slide. But what rarely happens in that same meeting is the part where anyone explains how.
Ambition is easy to say. It’s much harder to plan for.
That’s where the cracks begin.
The Illusion of Scale
When brands hit a growth streak, they often convince themselves they’re on their way to becoming the next global name. They set targets that assume the previous year’s performance was repeatable, scalable, and representative of a permanent trend.
The problem is, retail doesn’t behave that way.
One strong category, one viral moment, or one distribution deal can distort the baseline. Yet those moments are used as justification for inflated targets. The leadership team decides next year’s revenue will double. The board agrees. Merchandising and finance teams get told to make it happen.
That single decision, often made with a mix of optimism and ego, triggers a ripple effect across the entire operation.
When Targets Outrun Reality
Hitting an ambitious revenue goal doesn’t just require selling more. It means buying more. Manufacturing more. Holding more stock.
So, merchandising teams build buys around numbers that don’t yet exist in the market. Finance releases budgets that assume the sales will come. Everyone else is forced to believe the story.
When those sales don’t arrive, the result is predictable: bloated stock, constrained cash flow, and the slow erosion of margins.
It’s a quiet kind of mess that doesn’t hit all at once. By the time anyone realises the target was unrealistic, the next buying cycle has already started. Another season of stock is on its way. The problem compounds.
The Merchandising Reality Check
Inside most retail organisations, there’s usually one group silently shaking their heads while everyone else gets carried away: merchandising.
They’re the ones who sit at the intersection of finance, buying, and sales. They know what the data actually says about sell-through rates, stock turn, and category performance. They know when a growth projection doesn’t match the product pipeline or when stores are underperforming compared to expectations.
But they’re rarely the ones setting the targets.
Instead, they’re asked to hit numbers that were agreed before anyone looked at the data. So they model different scenarios, trying to make the maths work. If wholesale declines, DTC has to grow. If retail traffic is down, e-commerce needs to pick up the slack. But when every lever is already stretched, there’s nowhere left to go.
It’s not a lack of ambition that holds these teams back. It’s the absence of logic guiding the ambition.
Scenario Planning Isn’t Bureaucracy
In high-growth environments, scenario planning can sound like something that slows the business down. A spreadsheet exercise for people who like saying no. In reality, it’s the thing that stops the business from driving blind.
Good scenario planning links ambition to operational feasibility. It forces leadership teams to ask, “What would need to be true for this target to happen?” It connects revenue goals to actual inputs; category growth, channel performance, stock capacity, margin mix, and investment in marketing.
When done properly, it gives merchandising, finance, and commercial leads a shared language. The target might still stretch the business, but it’s one the business can realistically support.
Without that, numbers are just slogans.
The Stock Hangover
Retail has a short memory when it comes to excess stock. Each season brings another chance to reset, another opportunity to “trade out of it.” But overbuying is rarely solved with optimism.
The pattern is familiar. A brand invests heavily in a category it wants to grow, convinced that sales will follow. The product lands, and sell-through is slower than expected. Discounts are avoided to protect the brand. Months pass, cash is tied up, and new inventory starts arriving.
By the time anyone revisits the original assumptions, the business has already committed to the next round of buying.
At that point, it’s not a demand problem. It’s a planning one.
The Ambition-Tool Mismatch
Unrealistic growth targets don’t just distort stock levels. They also influence how brands spend internally. Leaders start investing in tools and systems designed for companies ten times their size. A planning platform that promises to “unlock scale.” A CRM that assumes a global audience.
The logic is the same: “We’re going to be that big soon, so we might as well prepare for it.”
Except most brands aren’t held back by the lack of a system. They’re held back by the lack of discipline in how they set goals, analyse performance, and plan buys. Implementing enterprise-grade software doesn’t fix that. It just hides it under more dashboards.
The truth is, most businesses don’t need a complex planning suite or a six-figure PLM. They need a shared understanding of what growth means in practice, and the right data to plan for it.
Listening to the People Who Actually Know
There’s a pattern that repeats itself across every level of retail. The people closest to the numbers are the ones most aware of the risk. The people furthest away from them are the ones setting the targets.
When leadership ignores that reality, the cost isn’t just overstock. It’s wasted time, strained teams, and missed opportunities to grow sustainably.
Merchandising and finance aren’t there to kill ambition. They’re there to keep it honest.
Grounded Ambition
There’s nothing wrong with aiming high. Every brand should. But ambition without grounding is just a story, and in retail, stories are expensive.
A good target should make teams stretch, not break. It should make the business smarter, not riskier. And it should be built on data that reflects how customers actually buy, not how leaders hope they will.
The brands that grow sustainably aren’t the ones shouting about their next revenue milestone. They’re the ones quietly aligning ambition with operations, listening to their teams, and planning for growth that their systems, stock, and customers can support.
The rest are still chasing round numbers.