Renting Clothes for Sustainable Fashion: Niche Markets Hold Key to Success

Renting clothes can significantly reduce the environmental impact of the fashion industry, which accounts for up to 10% of global greenhouse gas emissions. Researchers at Chalmers University of Technology in Sweden have studied alternative business models for the clothing industry and found that a rental company’s success lies in targeting specific niche markets.

In Sweden, over 90% of clothes’ climate impact is linked to purchasing newly produced goods. The researchers analyzed nine Swedish companies attempting to create sustainable and desirable clothes rental services. They identified three primary business models:

1. Membership model: customers become members and borrow clothes for a set period.
2. Subscription model: customers pay a monthly fee to rent a certain number of garments.
3. Individual rental model: companies provide specific types of clothing to rent, often paired with other equipment.

The researchers found that these business models face challenges in achieving profitability due to high costs for handling, logistics, and laundry, as well as difficulties obtaining venture capital.

However, companies focusing on niche markets, such as outdoor clothing, were more successful. By working closely with suppliers and manufacturers, rental companies can gain valuable insights into popular types of clothing and their quality. This collaboration enables the creation of value and helps businesses establish themselves in the market.

Based on their research, the scientists provide recommendations for those trying to rent clothes as a business model:

* Identify specific niche markets
* Collaborate with suppliers and manufacturers
* Develop a sustainable and desirable product or service
* Establish strong relationships with customers

The study emphasizes the importance of initiatives contributing to sustainability transitions, even if some companies may not survive. The results can be an essential contribution to the fashion industry’s transition towards more sustainable business models, providing insights for decision-makers and financial motivation.

By promoting sustainable fashion practices, such as reduced clothing purchases and extended use of existing garments, we can reduce waste and minimize the environmental impact of the fashion industry.