Published by ETRetail.com, May 8, 2017.
The fashion industry has a holy grail of “size sets” or “ratio packs”
The standard pre-defined assortments of goods that are used for production and logistics. To understand this: when an article is conceived for the range of the company, considering that the customers require a size that fits them, the same article (design, colour) is manufactured in all the size options (XS, S, M, L, XL and so on, or sizes – 28, 30, 32, 34 and so on).
Since the distribution of human population is not equal across physical attributes, the industry cannot manufacture the same quantities of each size (the number of XS, S, M, L, XL people is not equal!). This is the “etymology” of the size set. The set is supposed to be designed after careful analysis of population distribution. It is almost a normal curve distribution with many quantities of some regular sizes and very few of the extreme sizes (too big or too small). For example a set of a garment design might have many numbers of sizes M or L and very few of sizes XS on one side of distribution and size XXL on the other extreme. This distribution supposedly reflects the overall population distribution of the sizes. So a typical ratio pack of, say, a T Shirt design may have 1 x XS, 2 x S, 3 x M, 3 x L, 2 x XL and 1 x XXL.
So far so good?
Now let us look at the problem:
A visit to any retail outlet will tell us that stock-outs at size level are significant. It is not surprising to find out that the size for specific design selected by you is not available. Of course the sales person tries his best to shift your interest to a different design. Many a times the customer shifts and many times does not. So end of the season what is left over is not only odd designs but also odd sizes.
Why do you think this happens?
There are two factors at play here. One is the fact that though over all population distribution may follow the normal distribution curve for variation sizes, the sales of a particular do not necessarily obey that distribution! After all consumer choice is an enigmatic subject. The assumption that for 3 Medium sized people who buy the Pink chest print T shirt with white collar, there will two XL people and 1 XXL person buying is not true. Reality tells us that at a shop and at a day to day level the arrival can be very erratic. The fluctuations at a shop level much more than what is seen at a large population level. We can suddenly have too many people of a specific size walk in causing a stock out while the other sizes lie as inventory. But that still does not explain stockouts and surpluses, right?