Why Big Stores Like Lululemon Are Cutting Products From Shelves

Ever walked into a store and noticed fewer choices than before? That's happening on purpose. Major retailers are cutting down the number of different products they sell to make their businesses healthier.

When companies report earnings (their regular updates on how much money they're making), many have mentioned reducing their SKUs. A SKU ("stock keeping unit") is simply a unique product type — for example, each flavor of body wash is a separate SKU.

Here's how much some big names are trimming:

• Dollar General: cut around 1,500 SKUs
• Under Armour: shrank SKUs by 25%, plans another 25% cut
• BJ's Wholesale Club: plans to cut about 20% of SKUs
• Lululemon: cut North America SKUs by 15%

Why do this? When products don't sell, stores slash prices to clear them out. These price cuts (called markdowns or discounting) eat into profits. Too much discounting is a warning sign that a company bet on products customers didn't want.

Under Armour's operating income (the profit left after paying normal business costs) actually turned negative in 2025 and 2026 — meaning it lost money on operations. Its CEO said the plan now is "fewer products" sold at full price.

Lululemon's situation shows the trade-off clearly. Its sales grew by over $500 million, yet its operating profit fell by about $300 million — and its stock price (the value of one share, a tiny piece of ownership) dropped around 65% over two years. An analyst warned that having too many products — even good ones — can "cheapen" a brand's cool image.

For discount and warehouse stores, the reason is different. BJ's and Dollar General aren't trying to raise prices. Instead, cutting products:

• Makes shelf space for better-selling or new items
• Pushes shoppers toward remaining products
• Helps get goods to stores faster

The bottom line: Retailers are betting that selling fewer things — done carefully — makes them more profitable and more appealing. The risk? Shoppers who can't find what they want may simply go to a competitor.

This is an AI-generated summary. Read the original article at: https://www.cnbc.com/2026/10/10/from-bjs-to-lululemon-retailers-are-trimming-assortments.html