A new business that caught my attention recently is "Rent the Runway." RTR borrows from the Netflix and Bag, Borrow, and Steal model and rents by mail high-end dresses to consumers. The company was founded by two Harvard Business School grads, and was recently profiled in the New York TImes. Right now the selection is pretty limited, but the site promises new designers soon.
My favorite dress right now...
What I like:
- This business solves a fundamental consumer problem. Dresses are expensive and fashionistas don't want to be seen in the same dress twice. For New Yorkers with lots of events, this solves a huge budgetary problem.
- The site is really well organized. I love how you can sort dresses by occasion and trend.
What Worries Me:
- What is the shelf life of a dress - How long will the same dress be rented out? Will RTR make a profit on the dress through rentals before the dress needs to be "retired"? Can the dresses be sold once they run their useful life?
- Does demand equal supply - what sizes and styles will consumers want and is the inventory supply enough to meet consumers demand?
- How to find the membership "sweet spot" - what is the right number of members to balance demand and supply without frustrating consumers with availability?
- How to calculate trend demand - Inventory (dresses) are expensive and RTR needs to make sure they are on spot with the styles and sizes that consumers want.
I have a lot of questions, but I'm rooting for RTR! It is an innovative idea and I am supporting my fellow b-school women entrepreneurs!