How the dress shirt collar should fit
The dress shirt collar should fit comfortably without being too loose. As tight or snug as possible without being uncomfortable. You should be able to fit 1-2 fingers between the collar and your neck when it is buttoned. You should not have a large gap showing between the collar and neck. Heavier men should make sure their necks are not puffing out over the top of the collar.
We try to account for shrinkage in how we make the collar size, so a 16” collar should actually measure a strict 16.5” right out of the box. It’s first wash should get you some of the shrinkage, but not necessarily all.
If you never wear a tie
If you never or rarely wear a tie, having the collar a bit tight when buttoned is totally ok and in some cases will make the open collar stand up more nicely.
If there’s a gap behind your neck
If the collar feels uncomfortably tight when it is buttoned, but you can still see a large gap between the back of your neck and the back of the collar band, then you will want to consider using a neck forward posture adjustment.