# Authority limit

An authority limit is the largest value a person can commit without escalation; above it, a decision waits for sign-off from someone more senior.

- **Is:** The largest commitment a person can approve without escalation.
- **Decides:** Which decisions a buyer makes alone and which go to someone more senior.
- **Watch for:** A limit so low that routine work queues for approval.

## What it means for retail and category teams

Authority limits, also called approval limits or delegated authority, are common in retail buying and finance. They are usually set by role and may differ by decision type, such as a higher limit for routine decisions than for a new supplier. They control the size of a commitment, separately from margin rules such as a gross-profit floor.

## Why it matters

The limit lets a team push routine decisions to the people closest to the category without pushing the consequential ones down with them. Set too low, it floods managers with approvals and slows the trade; set too high, it removes a useful second look at the largest commitments.

## How Twelfth handles this

In twelfth, the authority limit is a workspace guardrail. Larger commitments wait for a manager's sign-off, and the decision record shows who approved them.

## Illustrative example

The business and figures are illustrative. None of it is customer data.

A buyer has a $25,000 authority limit. A routine $8,000 reorder goes ahead on their approval. A $40,000 order for a seasonal range is routed to the category manager, who approves it after checking the forecast and the supplier's delivery dates.

**A buyer with a $25,000 authority limit**

| | Commitment | Result |
| --- | --- | --- |
| Routine reorder | $8,000 | Buyer approves |
| Seasonal range order | $40,000 | Category manager signs off |

Reference line: Limit: $25,000.

Below the line the buyer decides; above it, a second person does.

## Related concepts

- [Guardrail](https://twelfth.ai/glossary/guardrail)
- [Gross-profit floor](https://twelfth.ai/glossary/gp-floor)
- [Decision record](https://twelfth.ai/glossary/decision-record)

## Next step

### See a decision move through Twelfth

Bring a decision your team already makes. We can show where its evidence, owner, approval and record sit in the workflow.

- [Book a demo](https://twelfth.ai/book-a-demo)
- [twelfth for heads of category](https://twelfth.ai/for/heads-of-category): One ranked view across every category, with decisions and reasoning captured, for leaders accountable for a whole portfolio.

Source: https://twelfth.ai/glossary/authority-limit