Plus sizes prove positive - women's clothing retailing

Discount Store News, Nov 4, 1996 by James Mammarella

NATIONWIDE DSN REPORT -- To locate good news in women's apparel, it's best to think big--or small. Several years of attention to better quality and styling in women's special sizes is creating new turn and margin opportunities for discounters. Plus sizes in particular are key.

Promotional pressures have driven down prices and margins in women's sportwear over the past few years. The same trend happened with plus sizes, but this year the average price per unit in plus sizes appears to be stabilizing. With customers increasingly making mass merchandisers the destination for their special size shopping needs, those retailers have built up a substantial base of business that may lead to better margins.

Dollar volume of plus size business in discount stores increased by 30.5% between 1993 and 1995, rising from $2.1 billion to $2.7 billion, according to the American Shoppers Panel survey by the NPD Group (Port Washington, N.Y.). Unit volume, however, rose by an even more impressive 40.1% in the same period. The average price per unit, based on the survey, dropped from $10.93 in 1993 to $10.21 in 1995.

However, more recent results from the panel show that the dollar/unit disparity has reversed. For the first half of 1996, unit volume was up 7.6% over the first half of 1995--while dollar volume climbed a robust 11.3%. This resulted in a surge in the average price per unit from $9.79 during early 1995 to $10.19 for the same period this year.

Retailers, of course, are all for stabilizing prices, although their driving philosophy may have more to do with customers' perceptions of overall value.

"We're not looking to raise or drop prices," said Denis Lemire, executive vp, gmm at 303-unit Ames. "We're trying to our customers as good as better values than ever."

Within that focus, Ames plus size buyer Linda Magnello said the average retail price in her department, "is stabilizing at about $11 or $12." While Ames offers plenty of plus size items priced below $10 in its Special Buy program, the plus size assortment also includes retail prices as high as $24.99 on such items as rayon and polyester blend blazers.

"The return on investment is good," said Lemire, " and growing our plus size business satisfies our core customers."

Some retailers would go even further in lauding special sizes. "All of the women's business is pretty promotional," said Celia Clancy, senior vp and gmm, soft lines at 112-store Bradlees. "But the base is stronger in plus, maternity and petites, so the margin is better." In other words, Bradlees' efforts to build special sizes into a destination for its shoppers is paying off, as the effort to promote the goods need not undercut margins.

For spring 1997, Bradlees will plan each of these three special size departments up more aggressively than its misses business.

Ames, too, has plans for plus that we slightly more aggressive than its projected overall misses volume. While Ames has expanded its plus size business from 13% of women's apparel two years age to 22% today, Lemire said the chain will not expand its offering into maternity, a trickier trade compared to plus. Petites, however, "are a potential down the line, after we really develop our misses and plus sizes."

Plus is already a headquarters at Ames. Magnello said, "Ames gives more ad space to this department. I have never seen any of our competitors devote two-page spreads to plus."

Plus size is also a very big business at the biggest retailer. Vanessa Castagna, senior vp, gmm for women's, girls and infants at 2,270-unit Wal-Mart, said that her chain has responded to the upswing in plus size business by breaking out the department as a division. Reporting to Castagna as the new dmm is Connie Bennett, who had prior experience at Marshalls and Target.

"Our focus on plus sizes continues to grow," said Castagna. "We will increase the productivity of the department. Casualwear is the main focus, although our Kathiee Lee plus line is very successful as carrerwear."

While not keyed to a celebrity, private label is very meaningful in the plus size assortment at 770-unit Target. With items ranging from denim shorts in the Great-land label to nylon wind jackets and pants under the Pro Spirit actives line to mock Ts and zippered knit jackets under the Sostanza label, the department uses two dozen fixtures and a feature wall.

National brand partners are doing their share in plus sizes. Ames, for example, displays jeans by Riders within its plus size department. In fleece, a switch from Sara Lee's Hanes Her Way to its Just My Size brand this fall has yielded a 67% increase in volume, said Magnello.

Needless to say, Ames will respond to this powerful customer brand identification by rolling out Just My Size in its spring jersey program.

The Richard Simmons plus size franchise is also alive and well at some chains. Ames begins each fall or spring with one fixture and adds another as the season proceeds. Typical items for spring 1997 will be related separates in jersey: knit tops and dyed-to-match pants, either item for $16.99.