The Future of Fashion Is a Rented Dress

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March 15 at 6:34 AM

In an era when fashion trends change in a nanosecond and people increasingly live their lives on camera, many shoppers have a “one and done” approach to outfits: they want to wear a look a single time and then move on to the next.

But mid-range retailers angling to help shoppers look good in selfies don’t want to end up with a pile of unsold multicolor sequin party dresses, and they can’t bear the increasing cost of consumers wearing and then returning garments.

Could rental services be the solution? It’s a well-established practice at the high end, but getting the economics to work for affordable brands is tricky. And it looks like the enemy of efficient retail – it’s a complicated business that could sap traditional sales.

But the risks haven’t stopped Hennes & Mauritz AB from thinking about it. Express Inc. is among U.S. brands that have already got started.

It’s worth a shot. Sales are being squeezed in both America and Europe as women’s spending on clothes is increasingly getting shifted to experiences such as vacations and meals out. Renting could help retailers adapt to this new reality, as well as solve some of fashion’s perennial problems.

A chain stuck with a bloated inventory – perhaps because it has been a little too bold in its buying choices – could divert surplus items to a rental operation, where consumers might be more inclined to take a risk with fashion-forward pieces. This could offer a better economic outcome than getting rid of the excess through heavy discounts. Markdowns to shift unwanted stock can be a real drag on margins.