Are We Ready to Rent?

Rentals is a recurring theme in discussions on sustainable consumption – but is it feasible for outdoor gear and apparel? Rentaplagg’s founders are on a mission to prove the skeptics wrong.

Rentaplagg was founded in 2014, while Emelie Sellberg was still project manager for an events company and Magnus Sellberg had begun to study environmental science after years in the sports industry. In January that year, before opening the store, they attended the ISPO trade show in Munich to find a business partner.

“People thought the idea was crazy. No one believed in our business concept,” says Emelie Sellberg.

Since then, the fashion rental market has gained momentum worldwide. The most recent addition is Urban Outfitters in the US, which launched its rental service, Nuuly. Also in the US is Rent the Runway, the industry giant now worth over USD 1 billion with more than 9 million registered users. Founded in 2009, it focused exclusively on bridal and formal wear from famous designers. In the fall of 2017 the company shifted gears to casual wear, offering both rental of individual garments and a subscription service, including a subscription plan with an unlimited number of outfits and swaps.

Developments in the outdoor industry have been considerably more modest but have recently started to gain speed. So far, the projects mainly involve hardware. For example, REI in the US has offered a growing range of equipment rentals since last year.

US companies like Coozie and Outdoors Geek also offer a wide range of tents, sleeping bags and other hardware.

The same trend can be seen in Europe, albeit on a smaller scale. Vaude rents equipment online and through its stores in Germany. Sweden’s largest retail chain, Naturkompaniet, offers tent rentals at all stores.

However, rental operations at the major players are still modest compared with the two-person company from Åre, Sweden’s most famous ski resort.

“When we started, we worked constantly, based on the mindset that someone else would soon enter the arena, so we had to hurry. But that still hasn’t happened after five years,” says Emelie Sellberg.

Demand outpacing supply?

Customers in Sweden are ready, at least in theory. Over the past year the Swedish Trade Federation has noted a clear change in attitude among consumers regarding renting instead of buying. In 2017, ten percent stated in their annual sustainability survey that they would rent more in the coming year than in the previous year. One year later the figure was 24 percent.

Maria Sandow is administrative director of the Swedish Trade Federation STIL, an organization for Swedish fashion retailers. She says these figures are a clear sign of a change in attitude among consumers. But she believes that how much retailers dare to believe in and market a rental service is also important.

“Do rentals compete with sales, or complement them? Does in-store marketing focus on rentals, or on buying products?”

Tradition of rentals at ski resorts

The idea for Rentaplagg was born while waiting for the ski lift in Åre as Emelie and Magnus Sellberg observed the variety of styles among skiers, from exclusive ski outfits to ill-fitting clothing.
“We found it strange that people could rent skis and boots for their ski vacation, but not apparel. We also discussed the environmental aspects,” says Emelie Sellberg.

They entered a business concept contest, which brought them to the attention of a Swedish business incubator specializing in innovation, after which events unfolded quickly.

“We entered the business incubator in September 2013, won the competition in December, started the company in January and opened the store in February,” says Emelie Sellberg.

The customers they envisioned were families with children, as well as women aged 30–35, with limited financial resources and an interest in the environment.

“But our largest category that first year was middle-aged men renting black ski pants because they had left their own at home”, Emelie Sellberg continues.

Today, Rentaplagg rents out clothing and gear for all types of mountain activities, all year round. The customer base has broadened and collaborations with conference arrangers and event companies have become an important component of the business, even beyond Åre. They now send equipment packages to all of Sweden, Denmark and Finland.

Business models under development

Their business concept is based on the sustainability of a sharing economy, in which everyone does not necessarily have to own everything, and where quality takes priority over a throwaway culture. On the apparel side, Rentaplagg works closely with the brands Lundhags, Maloja and Woolpower, which own the garments and receive a commission on the rentals. Emelie and Magnus hope the business model will also motivate companies to manufacture more durable products.

“Ideally, manufacturers should consider making products appropriate for renting during the design process. Garments should be durable and easy to repair, recycle or reuse when they wear out,” says Magnus Sellberg.

One challenge for the rental business is that retail business systems are sales-based. New systems are needed to log the number of times a garment has been rented, its condition, etc. Moreover, the rental business is labor-intensive. The number of hours it takes to clean garments must be placed in relation to the cost of sewing new ones in low-cost countries. In addition, garments wear out rapidly when washed after each use, which negatively impacts the environment.

But Magnus Sellberg believes that the greatest challenge is convincing people to change their habits.

“It would be great if more actors entered the field, since that would generate more buzz about renting. Few Swedes even know that they can rent apparel and equipment for skiing and outdoor recreation.”

 

Photos: Gösta Fries

Mats Nyman
mats.nyman@norragency.com