The size curve, and why it decides value

Merchandising plans a curve from historical sell-through by size, adjusted for the channel and the region. A typical women's top might be planned with the bulk of units in the middle sizes and progressively fewer at each end. The curve is then multiplied out across the buy, so a decision made once in a plan becomes millions of physical units.

Because the curve is fixed at production, a curve that is wrong is wrong for the whole life of the style. No amount of in-season management can convert a 2X into a medium.

A size break is the point at which a size stops selling at the same rate as the rest of the style. The practical consequence is that a store runs out of the middle of the curve early and finishes the season holding the ends. From the buyer's side that leftover is not a small residue: on a large style it is tens of thousands of units that all need the same markdown treatment at the same time.

This is why the retailers who manage extended sizing well treat it as a separate plan rather than an extension of the core curve, with its own demand data and its own allocation logic.

By the time goods reach the off-price channel, the surviving inventory is heavily weighted to the ends of the curve, which is exactly the merchandise that clears slowest downstream too. An off-price buyer prices accordingly: a band that will sit in a warehouse for eighteen months is worth a fraction of one that will clear in a season.

The arithmetic is set out in how a lot is valued. The short version is that the size mix can move realized value by a quarter or more with no change to the goods themselves.