Deliver the right mix of apparel sizes, and hike sales 5%, Kellwood figures
Kellwood Co., a marketer of apparel and other products under such brands as Calvin Klein, Phat Farm and Sierra Designs, expects to boost sales of some women`s wear lines by 5% this spring with a web-enabled system that determines the best mix of product sizes for each of its stores, John Davis, director of retail analysis and product planning, said at the NRF conference and expo this week.
Kellwood, which does about $1.6 billion in annual sales, began last summer using a web-based size optimization application from 7thOnline Inc. The application applies mathematical algorithms against sales data provided by Kellwood to analyze what sold or failed to sell among apparel sizes across Kellwood`s retail partners` stores, then distributes over the web recommended allotments of sizes for individual store locations.
The system has proven an ability to maximize sales of apparel products without having to mark down prices while also reducing out-of-stock situations in stores, resulting in higher profit margins. "We`re moving in this direction as an industry," Davis said.
Saman Hong, vice president, analytics and optimization at 7thOnline, said retailers and brand companies generally increase sales 3% to 7% with size optimization, without having to increase inventory levels.
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