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Saks Off 5th will offload premium owned and designer fashion from Rent the Runway for up to 85 percent off, in a new deal aimed at attracting younger “trend lovers” to the US discount retailer.
Over 60 brands, including Gen Z favorites Ganni and Equipment, will be available to Saks Off 5th customers through a designated section of its website, the companies announced today. Saks Off 5th will buy proven stock from Rent the Runway, sell it and fulfill orders, helping the latter clear out old inventory. Rent the Runway has previously tried a similar partnership with rival Nordstrom Rack.
The push into pre-owned fashion is largely driven by consumer demand, says Saks Off 5th President and CEO Paige Thomas, who joined the business from Nordstrom two years ago. A survey of Saks off 5 customers found that more than 70 percent have previously purchased clothing, shoes or accessories; and another 80 percent want the ability to buy pre-owned fashion directly from the US retailer. The resale market is growing twice as fast as the first-hand market and is expected to reach 50 billion euros globally by 2025, according to management consultancy Boston Consulting Group.
“Our core customer is a ‘trendsetter’, which is actually a younger customer who loves fashion and aspirational brands in the luxury space,” explains Thomas. In 2020, Saks Off 5th teamed up with LXR, a Montreal-based company that retails and wholesales vintage luxury, to offer its customers pre-owned luxury bags. “We see this as a journey,” says Thomas. “We started with LXR and Rent the Runway came into play, which allows us to expand our range of brands our customers haven’t seen and/or invest in brands they already love that we carry on our site .”
Nasdaq-listed Rent the Runway has struggled to achieve profitability, in part because of its equity-heavy buy-and-hold model. In June, the company reported a net loss of $42.5 million for the first quarter of 2022, about the same as the $42.3 million loss it made in the first quarter of 2021. It initially offered a purchase option to its leased subscribers in 2016, and in June 2021 opened resale to all users, including one-time renters. To help it clear out old stock, in January 2020, Rent the Runway teamed up with rival Nordstrom Rack in a pilot to offer pre-owned fashion in some of its stores.
On Saks Off’s 5th partnership, Rent the Runway CEO and co-founder Jennifer Hyman says, “The secondhand economy is a critical part of creating a more sustainable future for our industry. Saks Off 5th is known for offering incredible designer goods at great prices, which is a fantastic starting point to educate more consumers and help extend the life of these garments.”
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