Because they don't want "fat" girls wearing their clothing. Their market is preppy, popular, thin girls. If everyone can have something, it loses it's "coolness"---in order for something to be cool or popular, it has to exclude people.
But don't fret; not being able to waste your money on overpriced clothing that makes you look like a walking-billboard is nothing to be upset about. :)
the same thing is done with the guys clothing, what is a large in teenage clothing outlets is a medium in what you would find at a place like target, or tj maxx where the clothes are not designed for the sole purpose of being form-fitting or being appealing to the opposite sext, they do that for both the guys and the girls, but it is only more apparent in the girls because they know what they are doin :-)
it goes back to how our society is these days, there are signs everywhere of what girls should look like, and what they should wear, girls wear more tight fitting clothing, and that is what they have to do if they are to be appealing to everyone or to look good (so the signs and propaganda implies)
Their clothes are horrible, boring and unimaginative. Its more fun and stylish to create your own look rather than advertise theirs. Shop in other stores or charity shops or learn to make your own clothes that will definitely fit! I've made some pieces and its so much fun!
I've wondered this myself ha ha I think it's because in all honesty it's fashion aimed at 13 year old girls who haven't gotten curves yet and who's parents will drop mad money on back to school clothes for them. Also, they haven't developed their own style yet, so it's an obvious choice for them. (ps I can barely fit into their mediums!)
Their clothes are so tiny! It's frustrating shopping there because I always have to get a couple sizes bigger so people can't see my bellybutton through my shirt it's so tiny. And I don't find anything special about their clothes really, though they do smell good hahah.