“Both businesses are focused on the circular economy – eBay is about resale, we are about rental. Working together was a straightforward next step.”
While the partnership with eBay will not change the way The Volte is run, the two businesses will promote each other.
“They will support our rental, we will promote them as our resale partner,” Ms Olivier said.
Booming market
The fashion rental market is booming, with retailers such as David Jones and Country Road partnering with other players such as GlamCorner, The Volte’s competitor.
Internationally, pioneer Rent the Runway launched a disappointing initial public offering in 2021, and last year made about a quarter of its staff redundant in a bid to carve a path to profitability.
Ms Olivier believes her business model is different enough to weather economic storms.
“We don’t take on inventory,” she said. “And that cuts our overheads and ensures that we are focused on one thing: renting clothing. When you hold the inventory yourself, it dramatically shifts where your focus is. The business becomes one of logistics, shipping and laundry.”
Consumers can lease their own clothing on the site, and must handle all logistics – including delivery, returns, cleaning and any damage to the item – themselves. The Volte charges the lender 15 per cent commission and the borrower 13.5 per cent, plus an optional $5 fee for insurance.
Cothing as assets
Ms Olivier believes the luxury price point of The Volte’s clothing gives it an edge.
“Our average dress is sold on the rack for $1500,” she said, citing commonly rented brands such as Zimmermann and Aje.
“Our customers are renting out their clothing as assets, the way you would with a house and Airbnb. So, they are invested in providing a good experience for the renter, and treating rental as a business.”
Consumer analyst Craig Woolford, from equities research outfit MST Marquee, said there would naturally be a “softening” in the post-COVID rental market. To ensure long-term success, platforms needed to ensure a breadth of choice for consumers while protecting those lending their assets, he said.
“A lot of these businesses had incredible success during COVID,” Mr Woolford said.
“There was outsized demand in retail online during that time, and it would have made its way to the rental market. Consumers are going back to stores now, though, and they do have more options. So, I think the appeal of rental will soften.”
Attracting repeat customers was also key, Mr Woolford said.
“What these platforms will need is a certain amount of scale to succeed. Great inventory is one thing, but you need breadth of range, styles and sizes to have long-term success. Platforms that have that breadth will emerge as the winner here.”
In October last year, The Volte began working directly with designers to introduce them to the rental market. Rebecca Vallance, Alemais and Kit X were among the initial offering, and Ms Olivier said there were more to come.
“Our biggest challenge is prioritisation,” she said. “We offer luxury fashion for rental but up until very recently, the website did not reflect that, for example. This round of funding will allow us to act like the company we know we can be.”
