As both retailers and consumers are grappling with the effects of COVID-19, rental platforms like Rent the Runway and RealReal are also facing a shortage of orders. Demand for rented work wear and occasion wear is drying up as conferences, weddings and other events are being canceled across the board. This can be noted from the example of Nova Octo, an evening wear rental service, whose new rentals dipped by more than 90 percent last week. The supplies of resellers like The RealReal and Vestiaire Collective, are also affected as stores remain closed. This is likely to delay future consignment processing times of these sellers by up to four weeks.
Similarly, Vestiaire Collective is facing an inventory build up as many customers are depositing their old clothes in these stores. The Paris-based company closed its New York warehouse over the weekend as per Governor Andrew Cuomo's executive order for all non-essential workers to stay home. However, the company is seeing an increased visitor turnout on its shopping app.
As per managing director of of GlobalData Retail, Neil Saunders, during these times, shoppers that use rental and resale services, may have less disposable income hence, they are likely to cut non-essential purchases out of their spending habits.
Though New York City-based rental service, Rent the Runway, is yet to see members pause and cancel the service en masse. However, some of its competitors like the Seattle-based Armoire have been recording a significant number of cancellations since the last two weeks.
Despite such instances, online shopping may increase due to the growing work-from-home culture. As retail customer service platform Hero reveals, in the second week of March, e-commerce purchases made between the hours of 9am and 6pm jumped 52 percent compared to the same period last year. Rental users, in fact, are embracing dressing up at home rather than for the office.
