Timing of seasonal sales

We present a model of timing of seasonal sales in which stores choose sever al designs before the season without knowing which, if any, is fashionable. Stores begin by charging high prices to capture the fashion market. As the season approaches the end with goods still unsold, stores have sales to ca pture the discount market. More designs and greater price competition in th e discount market induce earlier sales. The results are consistent with the observation that the trend toward earlier sales since the mid-1970s coinci des with increasing product varieties in fashion goods markets and increasi ng store competition.