How the FullBeauty and DXL merger reshapes the Big & Tall market

Last week, two major players in the US’ size-inclusive apparel category joined hands. FBB Holdings I, Inc. (FullBeauty) and Destination XL (DXL) announced a major merger in a move that intends to accelerate respective growth plans and scale the presence of a “category-defining retailer for inclusive apparel”.

Framed as a “merger of equals”, the transaction creates a combined company with around 1.2 billion dollars in annual net sales, a scale rarely achieved in a category that has historically been fragmented and undercapitalised. For the US fashion market in particular, the deal reflects a shift in how inclusive apparel – specifically Plus Size and Big & Tall – is being positioned, moving from a niche segment to a category of scale garnering the ability to compete with mainstream retailers.

North America dominates market, yet category remains fragmented

According to Data Intelo, the global plus-size and Big & Tall apparel market was valued at 134 billion dollars in 2023, and is projected to reach 179 billion dollars in 2032, expanding at a CAGR of 3.4 percent. North America is expected to remain a dominant region, supported by a mature retail infrastructure, high consumer spending power, and a cultural shift towards body positivity.

Despite this growth, however, the US inclusive sizing market remains highly fragmented. Many brands operate within sub-segments, limiting investments into fit technology, omnichannel platforms and inventory. Through the merger, DXL and FullBeauty intend to address this structural issue, becoming one of the largest inclusive apparel retailers in North America through both sales and store count.

“The combined company only captures a portion of a largely untapped market, highlighting significant growth opportunities ahead,” the press release announcing the merger noted. Among those advantages are that of a unified sourcing strategy, a plus in a market known for higher costs. The transaction is expected to generate 25 million dollars in annual run-rate cost synergies by 2027, largely through reduced overhead expenses, cost-of-goods optimisation and other cost-saving measures.

Investments into sizing technologies and product development

By merging, DXL and FullBeauty also strategically bring together their channel mix. The combined company will generate around 73 percent of sales through direct-to-consumer channels and 27 percent via brick-and-mortar stores. This hybrid model reflects broader market shifts, with online channels expected to dominate the inclusive apparel category over the next decade. In its report, Data Intelo said the division would be driven by convenience, AI-powered personalisation and wider assortments.

Indeed, the combination of DXL and FullBeauty could allow for deeper investment into new technologies in the sector, pushing forward opportunities in the way of fit, product development and analytics, each area deemed an obstacle for the market. Each company has established fit-centric tools, such as DXL’s Fitmap and FullBeautry’s free exchange programme, which could benefit from shared data and broader application.

There is, of course, the question of competitive diversity. While the combined company will only represent a portion of the market, its expanded footprint could make it harder for smaller, independent brands to compete. This is only exemplified by the involvement of major players increasingly testing the waters of size-inclusive clothing, including H&M, Walmart, and Amazon.

Alas, the DXL-FullBeauty merger signals a shift underway in the US, a one in which inclusive sizing has grown beyond the sidelines to a more mainstream market. According to the duo, the transaction further reflects increased investor confidence in the extension of size offerings, particularly in retailers that specialise in the category and therefore offer an unrivalled expertise. With this, the merged company is positioning the maturing category at the core of its business, underlining its long-term strategic relevance.