Why Are Discount Stores Full of XS and XXL Clothes?

INSERT DESCRIPTIONPhoto: sporkist

My former Ph.D. student and frequent co-author Erik Snowberg sends along an interesting question:

Why do discount clothing stores (like Nordstrom Rack — and clothing sales in general) have an excess of really small and really large sizes?

I have to admit, I’ve always wondered. Erik continues:

The typical answer seems to be that there are more medium [people] in the world than XXL’s. Duh.

But the problem with this idea is that clothing buyers for stores obviously know this. And if they didn’t at first, they should have figured it out by now.

Hmm. He’s right — it is important to think about the supply side as well as demand. If there are twice as many mediums as XXL’s, then twice as many should be produced; and so it should be about as likely that a store will be left with excess mediums as XXL’s.

Here’s Erik’s explanation:

My best guess is that for some reason small and large people are, in general, less willing to pay for clothes. Maybe because they are outside of the norms for physical beauty, they believe that sharp clothes won’t help them that much.

Whatever the reason, a clothing store can’t set lower prices for different sizes, so it price discriminates by waiting a little bit and putting remaining stock on sale — which happens to be (surprise!) in the large and sometimes small sizes.

That’s a pretty interesting story, and it may well be right. But there must be readers with better information, or competing theories.

What are your thoughts?

Leave A Comment

Comments are moderated and generally will be posted if they are on-topic and not abusive.

 

COMMENTS: 231

View All Comments »
  1. Dan says:

    I am a XXLTall guy, I gave up on finding my size in retail stores (business and business casual) a long time ago. 99% of my shopping is done on-line or by catolgue. I am not sure how this choice is reflected in the discount rack scenario, but what I want or need is not generally avaiable.

    Thumb up 0 Thumb down 0
  2. Susan says:

    But isn’t this infinite regress? Shouldn’t the buyers have figured out that in addition to there being fewer XS and XL people, they buy less per capita, and thus they should stock accordingly?

    Thumb up 0 Thumb down 0
  3. Richard says:

    Another theory
    Shops need to have some stock at each size but as the number of stock required gets higher the % oversupply drops as you can’t have half a dress on a rack.
    These overstocked items are then transferred to discount stores but now the number of medium sized clothes is closer to the number of large and small sizes than the original stocking requirements.
    At this point the medium sizes are run out quickly and only the smaller and larger sizes remain

    Thumb up 0 Thumb down 0
  4. Brian says:

    I’m sure part of excess in XXL and XS clothing is because medium-sized shoppers, being more prevalent, buy out the discounted stock at a much faster rate. Knowing that if you leave the store to think about it you won’t find the same item when you return could lead to more impulse buying. You have to be on your toes to make good finds if you wear a popular size.

    Larger and smaller than average sized people know after a lifetime of experience shopping that they don’t have to hurry to purchase an item. The extra time to think over the purchase decreases their chance of buying clothing they don’t need.

    Thumb up 0 Thumb down 0
  5. Rev Matt says:

    Another possibility: people in sizes other than XXL may buy multiples of something they like figuring they aren’t likely to drastically change their size in the next few years, whereas people in the XXL range think that they well (this is related to the comment of Adam). This does not provide an explanation for the XS.

    Thumb up 0 Thumb down 0
  6. LB says:

    It may not be just the style of clothes or the price that leads to the remainders, it may also be the store’s style or reputation. It is for me, anyway. I’m an XXL-wearing woman and it would never occur to me to shop at Nordstroms, and therefore I’d never go to Nordstroms Rack. Nor to Macy’s, Bloomingdale’s, or any of that ilk.

    The times I’ve tried to buy large-size clothing in upscale department stores, I’ve literally been discouraged – by the store’s layout, by the looks and “assistance” from sales clerks, and by the looks (and occasional reactions) from other patrons. Not everyone or every salesclerk is rude, some are very helpful, but there have been enough incidents that I just don’t bother any more.

    The women’s section or large-size section in a department store tends to be in the back of the store. It tends to be further away from the fitting rooms. There tend to be fewer, if any, attendants available. It is generally not a welcoming message. There have been enough remarks like, “we don’t get much call for that [a business suit!] in this size range” delivered in an insincere tone to make it clear I wasn’t welcome. (Think of the first shopping scene in Pretty Woman, and the sneering “help” from the clerks – that’s about right.) Why would I return to a store that makes it clear they don’t want my money? If they’re then left with the few garments they bothered to buy in my size and have to sell them at discount, that’s their problem. If you drive away your customers, you can’t expect to sell your stock.

    Also, “XXL” means different things in different stores. In some stores and catalogs, XXL translates to a 20-22. In others, XXL is a 16 or 18. I’ve received some specialty catalogs where XXL is a 14!

    The average size of a woman in the US is a 14. Many stores stop carrying clothes at size 16 or 18. They’re ignoring nearly half the market potential.

    I make a good living (6 figures) and am quite willing to spend money on clothes that fit and look good. However, I’m going to do my shopping where I’m welcome.

    Thumb up 0 Thumb down 0
  7. mark says:

    I am on the business side of retail, and I believe the answer is similar to #8 above. When you do merchnadise planning (and this is built into the planning systems), there is uncertainty behind the demand you will experience for any product, and for any size of any given product. For smaller volume items, the standard deviation behind the predicted demand is obviously greater. So as you try to fill demand, there is a higher likelihood that you will be overstocked (and a similar higher likelihood that you will be on backorder) for low volume items. Since large and small sizes are out of the tails of the bell curve, you are always going to find that these sizes are either overtocked or on backorder with a much greater frequency than sizes in the middle of the bell curve.

    Thumb up 0 Thumb down 0
  8. Matt says:

    My thoughts, as someone working for a major apparel discounter, is we magnify the industry problem.

    A vendor usually will pack orders like this:

    1-XS
    2-S
    2-M
    2-L
    1-XL

    There are many more S-M-L customers, than XS/XL/XXL etc…and the size breaks do not accurately reflect the actual size breakdown of the customers.

    When discounters buy closeouts or orders that didn’t sell elsewhere, they receive an inordinate amount of XS/XL etc.

    So when you look at a discount retailer, the small errors of many manufacturers are gathered in one location , skewing the size breaks even more.

    Thumb up 0 Thumb down 0