Why Renting May Be The Future Of Apparel eCommerce

eCommerce as a whole is a healthy and growing sector, but the apparel niche continues to struggle with issues like high return rates.

Bricks and clicks clothing shops have equally troublesome challenges, causing many to close store after store in hopes of regaining profitability. Those retailers that maintain a presence in the eCommerce space are often working furiously to keep a foothold in their industry.

What’s an apparel company to do in these difficult days?

Turning Returners into Renters

The 30 to 40 percent return rate that many fashion eRetailers experience has been a serious problem for the entire industry.

Much of this is on customers who practice “bracketing,” a practice where the customer places an order for the same item in various sizes intending to try clothing on and send back what they don’t want. This is not an “if” kind of return, it’s a “when.” Coupling this practice with free return shipping has led to some serious cash flow problems in the industry.

But that may soon be changing.

Inspired by the success of Rent the Runway, a service that allows women to rent expensive clothing for events and return them when the party’s over, fashion retailers are testing the waters of clothing rental. Familiar names like New York & Co. and Express have started offering clothing rental for a monthly fee .

Turning Reverse Logistics into Rental Processing

New York & Co. has been forced to close 150 retail locations since 2012, according to reporting by Digital Commerce 360.

Clothing rental is one way that the chain can continue to engage their customers, even bracketers, on a regular basis without the additional financial pressure of dealing with return after return.

Instead, its reverse logistics team is busy repackaging those rented outfits for the next person. The same skillset and tools are needed, but because these items aren’t returned due to a defect, they can be moved more quickly from customer to customer.

If the customer happens to really like that pair of jeans or the kimono that they got in their rental package, they can then purchase it at a discount. Retailers can sell more clothing and handle fewer bracketed orders this way, making it a good solution to the cash hemorrhage that fashion eRetail can suffer.

Is Renting the Future of Fashion?

It may still be a while before renting an entire wardrobe is a common practice, but clothing rental does give the fashionistas among us a way to try the latest styles without having to commit to them right away.

Of course, if they love what was sent to them, it can stay as long as the subscription lasts, but in common situations where pants are cut funny or shirts aren’t the color expected, it’s no problem to swap them out for items that are much closer to perfect.

Being a cost that’s already anticipated, the eRetailer includes the shipping costs in the overall package price, potentially increasing cash flow that may have been sluggish in the past. Renting deals with the problem of chronic bracketing, too, which can be a big load off of eCommerce shops.

Like so many things in the Internet Age, clothing rental may not be the future of apparel, but it seems to be one future. Everything has a niche these days, even buying new jeans.

 

2019-01-15T19:55:43+00:00January 23rd, 2019|Categories: e-Commerce|0 Comments

Leave A Comment