Home REITs A Major Department Store Will Be Offering Rent the Runway

A Major Department Store Will Be Offering Rent the Runway

by WOOWinvest
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A Major Department Store Will Be Offering Rent the Runway

How many times have you worn that designer dress? For many fashionistas, that’s no longer an issue—a designer dress these days can often go from being made, to being rented out hundreds of times, and finally being sold to the final owner.

It might seem like an unusual business model, but in today’s economy, certain style lovers want to get the most wear and tear from each piece. While only 7% of the average American’s wardrobe in 2019 was second-hand clothing, that number is expected to rise to 17% by 2029.

Growing demand for second-hand and consignment items has been pushing brands that traditionally don’t want to be near second-hand clothing to make it a core part of their brands.

Rent a runway (rent) an online platform that started with renting out designer gowns and later expanded to everything from shirts to fitness leggings, has been the biggest in the space since it launched in 2009.

Who is renting the runway this time?

Rent the Runway has partnered with everyone from W hotels to British department store Selfridges over the years and will be worth about $1.7 billion when it goes public in 2021.

The latest department store to partner with Rent the Runway is Saks Off Fifth.Although both department stores are owned by Canadian giant Hudson’s Bay (HBAYF) the Saks Fifth Avenue branch is selling excess inventory from the main store at a discount.

As part of the new partnership, certain Saks Off Fifth stores will feature sections of Rent the Runway apparel — which can now be purchased at an 85% discount after renting through the platform.

The company works with more than 85 designer brands such as Ulla Johnson, Phillip Lim and Giambattista Valli.

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While the companies did not immediately respond to questions from TheStreet about how many times a piece of clothing was worn before it moved to Saks Off Fifth, the department store said a survey of its customers found that 70 percent of customers purchased second-hand clothing.

Another 80% of customers said they would like to see more used clothing in stores.

“Through this unique relationship with Rent the Runway, we are launching new brands, offering great deals, and offering pre-owned apparel from trusted partners that resonate with our customers,” Saks Off Fifth CEO Paige Thomas said in a statement.

Is consignment the future? Will there still be a turnaround?

There is some debate about the future of the used clothing industry and its continued profitability — with both startups and established brands dabbling in the space, some analysts say there is a risk of oversaturation in the market. Due to pandemic-related restrictions, many people want new and better clothes after staying for two years.

But while sales of new clothing are also on the rise, a recent study by online marketplace Mercari found that from October 2021 to December 2021, the number of second-hand clothing purchased increased by 24% compared to the previous year.

More importantly, many young people especially like this way of shopping. Gen Z, or those born between 1997 and 2018, buy 250% more second-hand clothes than other generations.

There are many reasons for this, from rising inflation to growing consumer awareness of the impact of fast fashion.

“Whether it’s leasing or shopping for resale, the used economy is a critical part of creating a more sustainable future for our industry,” Jennifer Hyman, co-founder of Rent the Runway, said in a statement.

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