Will IKEA become the world’s largest furniture rental outlet?
Furniture purchases are usually a long-term investment, provided nothing breaks. But now the world’s largest furniture retailer is planning to make buying a kitchen table or a bookcase less of a commitment by letting customers lease products rather than purchasing them outright.
In February, IKEA announced that it would begin trialing furniture rentals with the launch of its first pilot in Switzerland, according to CNBC. As the chain envisions it, customers will lease furniture for a given period of time and then either return it or replace it with something new. IKEA will then refurbish the returns and resell them.
The new plan comes as the chain seeks ways to develop new subscription services and reduce its environmental impact.
Rental services have gained popularity in some spaces in the U.S., especially apparel, over the past few years. Rent the Runway, for example, allows those on a budget to wear high-end luxury brands with a significantly reduced price tag and without having to commit to purchasing something expensive that they’ll rarely wear.
But furniture, unlike a given piece of luxury clothing, gets used frequently if not daily and yet does not experience the same degree of wear during use that clothing does. So, it’s not obvious if the same incentive is there for customers to rent furniture as there is high-end clothing.
Car leasing has long been a popular way of making a vehicle affordable, but cars tend to cost tens of thousands of dollars on average, making leasing the only practical way for many to afford one.
IKEA is on the opposite end of both the price and luxury spectrum from these rental-heavy verticals. The chain’s low prices are seen as a selling point by customers and the product tends to be seen as functional, if not disposable.
There could be some demand for the service, however, among people who frequently change up the look and feel of their homes or apartments. That could give IKEA an opportunity to experiment with longer-lasting furniture or unique designs that customers would be more likely to want short-term.
- Ikea will try renting furniture to prolong product lifespan – CNBC
- What’s missing from everyday fashion rental subscription services? – RetailWire
- Here are IKEA’s secrets to keeping its prices so low – Business Insider
DISCUSSION QUESTIONS: How likely is IKEA’s furniture rental service to prove popular? What do you see as the pros and cons of IKEA getting into furniture rentals and how do you expect its competitors to react?