The tendency of millennials to rent instead of buy is turning the retail industry upside down. And the shed industry is no exception.
The rent tendency brought on by the millennials has impacted older generation buyers as well. The large acceptance of the rent culture has made the rent-to-own option a real deal. In a culture where long-term rent is not only tolerated, rather, it is the new norm, rent to own (RTO) suddenly makes a lot of sense.
Why not own it after renting for a period of time, thus combining the best of both worlds? Renting a month at a time with no further obligations is a much larger value to the client than most retailers would have imagined.
“Battered by student loan debt and the Great Recession, millennials place less emphasis on owning and more on sharing, bartering, and trading to access coveted goods,” Jilian Mincer of Reuters reports. “These behaviors have propelled businesses such as car rental service Zipcar, taxi service Uber, and home rental site Airbnb.”
And the trend is extending into clothing, cars, and consumer good of all sorts. This has impacted the shed industry in a huge way and will continue to do so.
Apparel retailers are threatened by rental startups like Rent the Runway and Bag Borrow or Steal, Grace Ehlers writes on industry website The Robin Report.
Renting has also spread to the music and hospitality industries with companies like Spotify and Airbnb, Ehlers writes.
“Never mind buying a second home when you can rent a chateau in France on Airbnb for $200. Why hire a chauffeur when they don’t come with an app that tracks their relative location to yours, like Uber?” she says. “Even owning the latest album of your favorite band feels a lot less appealing when you can stream it immediately on and offline with a Spotify pro membership, without taking up any space on your hard drive.”
Rent the Runway has even started an unlimited subscription service for accessories and handbags.
Ehlers says that traditional retailers have missed an opportunity to accommodate millennial tastes.
“Why do retail brands depend so heavily on dispersed outlet locations to unload this season’s collections when they could rent them?” she asks.
The shed industry should embrace this new phenomenon and present RTO with clarity to the clients who value the benefit of a month at a time commitment.