Clothing Rental Models Transforming Fashion Sustainability

As sustainability becomes a central concern across industries, the fashion sector faces increasing pressure to adapt. One avenue gaining momentum is clothing rental—a model offering a potential shift in how garments are consumed and circulated. New findings from Chalmers University of Technology shed light on how businesses can strategically engage with this evolving space, providing a roadmap for brands and entrepreneurs interested in launching or refining clothing rental operations.

Operational Complexity and Logistics Management

While rental models offer sustainability potential, the path to profitability is far from straightforward. Clothing rental businesses often grapple with resource-intensive logistics. Key operational challenges include:

• Thorough garment inspection for quality and wear
• Complex warehousing and inventory control
• Transportation coordination across locations
• Ongoing laundering and garment care

These touchpoints significantly impact margins. Streamlining operations through digital systems, automation, and efficient reverse logistics is essential to long-term viability.

Business Model Variations: Choosing the Right Fit

The study categorizes rental models into three core formats, each tailored to different business goals and customer behaviors:

• Subscription-based rentals: Customers pay a monthly fee to access a set number of garments, offering predictability and scalability for businesses aiming for wider market reach.
• Membership or library models: These offer time-based access to clothing, similar to borrowing books. They often appeal to users seeking variety without long-term commitment.
• Individual item rentals: Ideal for specialized needs such as outdoor or event-specific wear. These models may include bundled equipment or services, targeting niche markets with higher willingness to pay.

Deciding which model aligns with a brand’s infrastructure and target audience is critical to minimizing risk and optimizing customer experience.

Market Positioning Through Niche Focus

Companies that successfully carved out market share tended to specialize in well-defined segments. Outdoor and performance apparel rentals, particularly those tied to recreational regions, demonstrated higher retention and operational sustainability. Niche positioning enables brands to tailor inventory, logistics, and marketing strategies around specific customer needs—improving efficiency and value delivery.

Clothing rental represents more than a market trend—it reflects a structural shift in how apparel can be consumed more responsibly. With fashion production responsible for a significant share of global greenhouse gas emissions, extending garment life through rental directly addresses one of the industry’s most pressing sustainability concerns.

The second-hand clothing market is expanding nearly 18 times faster than the new apparel sector, with resale platforms prompting consumers to evaluate garment value more critically before buying. This behavioral shift highlights growing demand for access-based and value-driven alternatives—positioning rental services as a natural extension of this momentum.