Exploring renting models for clothing items – resource interaction for value creation

In recent years, there has been increasing interest in business models for resource sharing (Acquier et al., 2019; Kowalkowski and Ulaga, 2024; Kumar et al., 2018; Melander and Arvidsson, 2021; Öberg, 2023). Sharing-based models have become more and more common in business markets and have proven useful in various industrial settings in relation to resources such as vehicles, equipment and work wear. Benefits include flexibility and increased resource utilisation (Kumar et al., 2018). Companies engaging in sharing have diverse motives, ranging from economic benefits to addressing sustainability and environmental targets. Sharing-based models have the potential to adhere to sustainable values (Laukkanen and Tura, 2020) and can be characterised as sustainable business models (Geissdoerfer et al., 2018), elevating economic, social and environmental levels in their business objectives (Comin et al., 2020; Runfola and Monteverde, 2023).

One sector that has been dominated by business models, primarily focused on economic dimensions such as short lead times and logistics costs, labour costs and high services, is the textile and garment industry (Sirilertsuwan et al., 2018). However, in the past decade, there has been growing pressure on companies to transcend their focus on economic success and resource utilisation to address sustainability and environmentally desirable outcomes (Kumar et al., 2018; Seuring and Müller, 2008). The European Commission launched new waste regulations and a new strategy for sustainable and circular textiles during 2022–2023, which is to be realised in 2030, meaning that there is a need to find new business models to support both re-use and re-cycling of textiles (Commission, 2024). At the same time, studies emphasise that sustainability in the fashion and luxury industry is far from straightforward and will present “paradoxical choices” (Akrout and Guercini, 2022), and in this respect, more research is needed to inform practices. Accordingly, studies have highlighted the need for new business models involving collaboration and resource sharing in the textile and garment industry (Abreu et al., 2021; Dominidiato et al., 2023; Guercini and Runfola, 2021; Pedersen et al., 2018). One example, which is the focus of this paper, is renting models.

So far, business models based on renting in the textile and garment context have been dominated by companies with roots in the laundry business (for example, companies such as Lindström and Elis), whose offerings typically include rental, laundry, repair, delivery, storage and finally disposal of work wear. Clothing rental for festive occasions, such as weddings or other occasions requiring formal dress codes, as well as carnival clothing, has proven to be a viable model over many years, especially at the community level of society (Acquier et al., 2019). However, beyond these examples, it is argued that the spread of renting models in the fashion industry is “shallow” (Adam et al., 2018; Jain et al., 2022). Nevertheless, today, there are increasing numbers of companies testing new business models to move away from fast fashion (Guercini and Milanesi, 2019; Guercini and Runfola, 2021) and venture into the rental business (Arrigo, 2021). In this context, previous studies have investigated consumer perspectives on renting fashion wear (Jain et al., 2022) and focused on digital platforms and retailers’ perspectives (Arrigo, 2021). Moreover, new business models, such as renting models, will require new ways of interacting and mobilising resources in business networks (Finch et al., 2012). This will, in turn, require support and change from actors in existing business networks to create value (Bankvall et al., 2017; Guercini and Runfola, 2021; Mason and Spring, 2011).

Therefore, the aim of the paper is to explore renting models and their value creation logics. The context of the study is the textile and garment industry, and start-ups focused on renting out particular clothing items. To fulfil this aim, we rely on the industrial marketing and purchasing (IMP) approach to business markets, emphasising interaction and relationships for value creation (Håkansson and Snehota, 1995, 2017). Relying on this approach, our research is grounded in the resource heterogeneity assumption (Penrose, 1959), which we foresee as relevant when researching renting models with a focal resource (clothing items) shared by many users and thus required to fit in multiple contexts. To increase resource utilisation in renting and create value in a sustainable model, resources need to be understood in the context of other resources (Prenkert et al., 2019). Some resources are influential through their financial impact, while others may be critical to an organisation despite comprising only a small proportion overall (Pfeffer and Salancik, 2015). It is argued that a crucial determinant of the performance of all organisations is their use of resources (Penrose, 1959), including both tangible and intangible resources.

Hence, exploring the value creation logic of renting systems needs to include the analysis of key resources and their interplay. This includes both tangible resources, such as clothing items, laundry facilities and logistics resources, and intangible resources, such as IT systems and fashion expertise, and how they are used most effectively. We rely on the framework referred to as the resource interaction approach (RIA) (Baraldi et al., 2012), which emphasises tangible and intangible resources and their interaction across inter-organisational boundaries (Baraldi et al., 2024). This forms the basis for the following research questions (RQs): Which different kinds of value creation patterns can be discerned in renting models? From these patterns, for whom is value created?

Although sharing-based models do not guarantee sustainability, there is currently a great deal of interest in their potential to generate sustainable value (Laukkanen and Tura, 2020). By increasing the number of uses for a single garment, it is argued that renting models improve resource utilisation and lessen the environmental impacts linked to the garment’s overall life cycle (Monticelli and Costamagna, 2023). However, a model that positively affects resource utilisation and promotes environmental sustainability might not generate sufficient profit to be economically sustainable. Profitability is not only influenced by the various benefits offered to consumers but also relationships with suppliers that affect the renting company’s ability to mobilise and use external resources. While recognising this complexity, this paper concentrates on the environmental and economic dimensions of sustainability under the assumption that renting reduces the environmental impacts related to a garment’s overall life cycle.

The paper is based on a multiple case study of start-ups pursuing renting models in the Swedish context. The cases cover renting models for fashion wear as well as outdoor clothing items. This has proven to be a challenging industry; while some of the businesses included in the paper are still operating, others have closed. Altogether, the cases shed light on the variety of renting systems, their development and value creation logic. Start-ups are usually characterised not only by innovative ideas but also by their lack of a well-developed network of business partners (Baraldi et al., 2019), e.g. customers and suppliers, which lock them into previously established resources. Therefore, start-ups can play an important role in introducing new business models that may break structures in existing business networks and facilitate change (Landqvist and Lind, 2022).

This paper contributes to three streams of literature. Firstly, based on the categorisation of renting models and their resource interaction patterns for value creation, the study contributes to additional insights into classifications of resource-sharing models (Melander and Arvidsson, 2021; Öberg, 2023). Secondly, it furthers the understanding of the interplay between resources with a basis in RIA with regard to resource mobilisation, utilisation and combination of resources (Finch et al., 2012). Thirdly, it contributes to the understanding of the textile and garment industry regarding the role of renting models as a way to further the sustainable development of clothing items (Arrigo, 2021; Dominidiato et al., 2023; Guercini and Runfola, 2021).

The paper proceeds as follows. Firstly, we present the theoretical framework used to structure our analysis. Thereafter, the method is described, followed by case descriptions, findings and a discussion. We end by providing conclusions and implications.

Business models for sharing resources have become increasingly important in recent years. In broad terms, the sharing economy is associated with sustainable development and a number of environmental promises based on resource sharing among several actors and thereby possibilities to increase resource utilisation (Kumar et al., 2018; Ritter and Schanz, 2019). Sustainable development, based on the Brundtland Commission definition from 1987, refers to development that meets the needs of the present without compromising the ability of future generations to meet their own needs. It encompasses the three dimensions (economic, social and environmental) of the triple bottom line framework, which are included as core in definitions of sustainable business models (Comin et al., 2020; Geissdoerfer et al., 2018; Runfola and Monteverde, 2023). Investing in new business models for sharing resources may be motivated by a desire both to achieve economic viability and reduce environmental impacts, mainly by increasing resource utilisation. However, for a business model to be sustainable, it needs to generate positive net value. Besides creating potential economic value for the company, it needs to generate net-positive environmental and social benefits (Dyllick and Rost, 2017).

There are many examples of sharing models directed at consumers, e.g. for cars, sports equipment or tools (Melander and Wallström, 2023), and recently this development has spread to business markets (Melander and Arvidsson, 2021). Hence, there are a variety of sharing models functioning in different ways. With this breadth as a starting point, there have been several suggestions for classifications. Öberg (2023) identifies seven forms of models based on their resource configurations: co-use, re-use, repeated use of latent resource, sustainable output, pooling of resources, service created specifically for user and product created specifically for user. Two of these models can be explicitly linked to clothing: re-use has to do with transferring ownership to a new user, while repeated use of latent resource concerns borrowing of clothing from a specific platform. Ritter and Schanz (2019) suggest four different models based on whether they are utility-bound or un-bound and if the focus is on enabling value creation/delivery or using it: singular-transaction model, commission-based platforms, un-limited platforms and subscription-based models. Melander and Arvidsson (2021) raise the question of what sharing-based models would look like in a business-to-business (B2B) context. Their results show three types of models: sales-, rental- and sharing-focused models. These three differ in terms of seller-buyer interaction and environmental sustainability impact. In turn, Kowalkowski and Ulaga (2024) developed a typology of subscription-based offerings in a B2B context based on a service focus (access vs outcome) and resource integration (one-sided vs mutual). The focus of this taxonomy is between customer and supplier and leaves four situations, with the most integrated being “intertwined journeys”.

In line with earlier definitions of renting, this paper focuses on renting models in which one actor rents resources from another actor for a certain fee without the ownership of the resource changing (Jain et al., 2022). In addition, several of the above categories or types of sharing models are considered relevant, for example, Melander and Arvidsson (2021), who discuss renting models as belonging to one of three categories of sharing models. Moreover, renting seems to work well together with singular-transaction models (Ritter and Schanz, 2019) and subscription-based models (Kowalkowski and Ulaga, 2024; Ritter and Schanz, 2019). In addition, Tukker (2004) differentiates between three types of models for making a product available to several users while ownership remains with the provider: product renting, product leasing and product pooling. Gaiardelli et al. (2014) later contributed a fourth type: sharing. In renting solutions, a customer gets sole use of a product for a limited period; in leasing solutions, they pay a regular fee for unlimited and sole use of a product; and in sharing solutions, the product is used sequentially by different customers. Finally, in the product pooling solution, a product is simultaneously used by different customers (Gaiardelli et al., 2014). Renting solutions may be further separated into one-off rentals of a product for a brief time and subscription rentals, where, for example, a monthly fee is paid for access to a range of products (Monticelli and Costamagna, 2023).

As previously mentioned, the textile and garment industry and laundry businesses have been offering rental services for a number of years. Öberg (2023) points out that co-use and re-use, in particular, are forms of renting that make sense in the textile and garment sectors. Jain et al. (2022) show in their systematic review of fashion rental consumption that the renting model has been slow in taking off, with contamination being part of the explanation, and that barriers to adoption vary between cultures. Other studies have also shown psychological perceptions of cleanness as an explanation for this reluctance (Klint et al., 2022). Arrigo (2021) takes the retailer perspective on renting clothes in the Italian context and raises the importance of collaboration and the additional need for digital platforms. According to Arrigo (2021, p. 13), it is not customers who are collaboration partners but rather “emerging designers and luxury fashion brands that represent the main key partners in fashion rental business models”.

In general, collaboration is mentioned in the context of resource sharing. Melander and Wallström (2023) emphasise horizontal collaboration in relation to the sharing of infrastructure, while interactivity and customer relationships are emphasised by Kumar et al. (2018) with respect to the sharing economy. Runfola and Monteverde (2023) conclude that several aspects of collaboration and networking are important in the fashion industry in the context of sustainable venturing. For example, they emphasise relationships with fashion brand owners for mutual benefit and relationships with non-business actors to promote a sense of sustainability. In addition, Runfola and Monteverde (2023) pinpoint the role of building relations with passionate consumers in communities for sustainable ventures. These communities can, for example, create links to members.

Shared resources and collaboration are the focus for sharing models, in particular, rental models (Ritter and Schanz, 2019). In traditional economics, resources are viewed as homogeneous, i.e. that they always provided the same value regardless of the context in which they are deployed. However, within more recently developed research streams, resources are often regarded as heterogeneous. For the theoretical approach applied in this paper (relying on the IMP approach), the assumption of heterogeneity implies that it is not a company’s resources per se but rather their possible combinations with other internal and external resources that determine their value in different contexts (cf. Håkansson and Snehota, 1995). Gadde and Håkansson (1993) argue that just as there is a need for different types of players on a football team, there is a need for different types of complementary resources that can be applied productively from certain business perspectives. In other words, there is a need for different types of resources that together create value for certain counterparts. In this process of mobilising resources (Finch et al., 2012), it is important to consider the different aims of the actors involved. As explained above, the assumption of heterogeneity (Penrose, 1959) is highly relevant when evaluating sharing models, as the focal resources (garments) are shared by many users and thus need to fit in multiple contexts.

For facilitating studies of value creation through resource combination, Håkansson and Waluszewski (2002) divide resources into two categories: technical or tangible resource units and organisational or intangible resource units organising technical resource units. The first category is further divided into products and production facilities, and the second is further divided into business units and business relationships. With basis in these four types of resource entities, this is referred to as the 4R model (ibid.). Products can be a single physical item, such as an item of clothing, a set of items or items in combination with additional services, such as training and support. The features of a product (goods and/or services) are mainly developed when the supplier, either individually or in interaction with various buyers, tries to combine the product with certain other resources. Some contexts are more uncertain, such as R&D projects and resource combinations that evolve over time (Silvestri et al., 2022). Production facilities, on the other hand, include physical space, such as shops, as well as equipment, routines and skills used in the production and distribution of products. However, there is not a clear delineation between products and production facilities. A resource that, from a supplier’s point of view, is perceived as a product may, from a buyer’s point of view, be perceived as a facility. For example, when a workwear supplier provides garments to a construction company, the workwear supplier perceives them as products produced in the company’s production facility, while the construction company perceives them as production facility units used in the company’s production of, for example, new buildings.

While other contemporary theoretical approaches, such as the service dominant logic, focus on value creation from the customer’s perspective (cf. Lusch and Vargo, 2006), IMP research is concerned with the value provided to each of those involved in the interaction (Bocconcelli et al., 2020). Prior IMP research has pointed out, in particular, the dual positive outcomes of resource combination and development through the interaction between suppliers and buyers (cf. Mouzas and Ford, 2009). Resources are also often in focus when analysing resource utilisation opportunities and efficiency, primarily driven by economies of scale. A concept usually applied in this type of analysis is similarity. Dubois (1994) argues that two activities are similar when they require the same resource. Thus, making use of similarities may provide opportunities for economies of scale and, thereby, certain cost advantages. However, companies trying to capture similarities should always compare the potential advantages of increased similarity with the disadvantages. Increased similarity may, for example, reduce opportunities for differentiation. Moreover, each individual resource has a certain scope of utility, i.e. the range of activities it can be used for. Secondly, each resource has a limited capacity regarding the quantity of output, such as volume and speed. For example, an inventory will have limited storage space and a transportation line with a certain capacity limit.

The paper relies on a multiple case study of renting models for clothing items. This method has allowed us to capture details of this phenomenon in context (Halinen and Törnroos, 2005), which, in turn, lays the ground for theory development (Eisenhardt and Graebner, 2007).

The cases were selected based on initial searches of secondary data gathered through the Retriever Business database for Swedish sources, which includes all published news in print, on the web and in broadcasts. Based on the keywords “renting”, “garment”, “clothes”, “fashion” and “sustainability”, we identified 101 items of documentation published during the 2015–2022 period, comprising 36 posts in Swedish newspapers and 74 posts in online news. All together, these documents led us to identify approx. 30 companies pursuing (or have been pursuing) a renting business model in the textile and garment industry in Sweden. Initial reading about these firms from online sources such as websites, blog posts and the above-mentioned news articles led us to selecting suitable cases for understanding renting models as initiatives for sustainable fashion. We selected seven cases based on criteria to ensure variety in relation to (i) the design of the renting model, (ii) the start of the business and (iii) whether the business was still active at the time of the study (several of the firms had decided, or were forced, to close permanently for various reasons). The business scope varied and included fashion and second-hand garments as well as outdoor clothing. The cases have been anonymised and assigned Greek letters for reference: Alpha – Ita (see Table 1).

Besides the initial secondary sources, interviews were an important source of data. We conducted semi-structured interviews with the founders of the seven firms as well as with other actors in the industry with an interest in or experience of renting out clothing items. Interview guides were prepared that covered the current status of the business and its background. Questions were included pertaining to the renting model, the business offering, customers, customer benefits (compared to buying), customer segments, suppliers and other collaboration partners and payment models. Questions were also included about important resources for rental, clothes, laundry, premises, transport, stock, social media, networks, events, knowledge and skills, as well as which resources were owned and which were accessed in other ways. Additionally, questions on challenges and opportunities were included.

The interviews were conducted online via Zoom and recorded and transcribed afterwards. Aside from reading newspaper articles prior to the interviews, the topic, renting models for clothing items, was relatively open to us before starting the interviews. The interviews provided reflections and interesting stories of all the renting firms. Several of the interviewees had clear rationales of contributing to a sustainable clothing industry, and some had previous experience working in the fashion industry, and their backgrounds were clearly reflected in their individual renting business models. The semi-structured format allowed us to follow up on specific insights, such as purchasing and supplier interaction, building IT systems and setting up showrooms. The interviews gave us rich descriptions of the stories of these companies.

One reason that some of the interviewees were willing to elaborate and reflect in such detail could be that they were no longer in business (see Table 1). Their paths leading up to this point differed and were, to varying degrees, associated with disappointment, e.g. in the capital systems for renting businesses. However, this fact enabled them to give a retrospect view, which is also emphasised by Halinen et al. (2013). This retrospective view could have helped enable interviewees to provide such rich and reflective perspectives of their firms pursuing renting models. The businesses that were still active could share details on their current business and future plans. Those managers were more engaged in day-to-day operations and were less reflective but contributed in terms of the perspective of active businesses.

In addition, interviews were conducted with eight other companies in the industry, two sustainability managers in established fashion actors in Sweden experimenting with rental models and managers in start-up firms in niche markets such as textile prints and children’s wear. In some instances, the other actors interviewed were involved in business discussions or were partners of the focal case firms. In total, the study rests on 15 semi-structured interviews (seven with founders and eight with other actors).

The analysis of the cases was conducted using the IMP approach and 4R-model (Håkansson and Snehota, 1995; Håkansson and Waluszewski, 2002) as a base. Mapping out resources and how they were connected and mobilised were key activities. In addition, the actor dimension emerged as vital for capturing value creation from different perspectives. The individual case analysis and the properties of each case, in combination with resource analysis, laid the ground for identifying the three renting models. The literature and previous classifications of models (Melander and Arvidsson, 2021; Öberg, 2023) also guided us in this respect to understand each case and category of model. In the end, the three forms of resource mobilisation, resource utilisation and resource combination were key for discerning the renting model categories with a basis in the seven cases. When these were established, discussions of their traits, in terms of resource interaction patterns and connected value creation logics, were carried out.

All cases of renting models are described below with unique features of each. The cases are presented chronologically from the starting year. Alpha was a very early version of the business model. It was founded in 2009 as a non-profit association, with premises located in an area with a rich cultural life and low rent. It aimed to explore a sharing economy and how a “shopping-free zone” could be created. The premises were furnished and styled to feel like a shop. “It was a like a rehearsal space for a band, the place where we were hanging out to be creative and work. It was a meeting point that created value in itself”. People could become members for SEK 400 per year and most members were women between 25 and 35 with an interest in fashion or sustainability. Clothes were donated or supplied by Swedish designers or brands with a focus on sustainability or new business models. Customers washed the clothes at home before returning them; however, inspection, ironing and some mending were done at the premises. Alpha closed down in 2018.

Beta was the first fashion rental company in Sweden. It was founded in 2010, and its main customer segment was women working in middle management with busy lives, such as, for example, with significant family commitments. Beta used a subscription model and had a showroom at a well-known address in the centre of Stockholm, the capital of Sweden. The showroom was a key resource in that customers could pass by and try on clothes, for example, during lunch hours. In the showroom, the founder of the firm could give advice. This was an important service in terms of introducing customers to, for example, new types, materials or colours of clothing. This company laundered and ironed all of the clothes itself. An IT system was in place for upscaling and reaching customers outside the city centre. At the end of every season, Beta used to sell the clothes to finance the purchase of new clothes for the next season. Unfortunately, COVID-19 had a severe impact on the company as people were no longer in need of business clothing. This led to the business closing. As the founder and chief executive officer (CEO) stressed, “I believe in renting models for clothing but Sweden is not ready yet”.

Gamma was founded as a non-profit association in 2012. The company charged a membership fee of SEK 50 and regularly applied for various grants to develop its business and associated ideas. It was initially situated in a co-working space with other associations in Gothenburg, the second-largest city in Sweden. The space included equipment for caring for the clothes, such as laundry machines, materials for ironing and sewing machines. It explored different activities connected to sharing economies, including membership, rentals and retail. One idea was to give designers a small percentage of the rental profits. As the CEO explained, “if you think about Spotify, when you play a song the artist gets a small profit too”. The company started out with a large amount of unique clothing and second-hand items. During its six years of operation, it cooperated with local organisations, music festivals, charities, filmmakers and researchers. Gamma’s business offering changed significantly over time, and by the end of its period of operation, it focused more on booked visits and styling services.

Delta was founded in 2014. The company initially rented outdoor clothing and introduced outdoor gear rental following customer requests. The company used a shop in a popular ski area as a base, but most customers contacted them via their Web page. Customers can rent an item from a day up to a year, and the company offers gear for arctic expeditions as well as tents for family camping trips. Since they were early movers in their segment, it was difficult for the company to establish relationships with suppliers. The suppliers, at that time, believed that they would be forced out of the market due to competition; the issue of starting a rental business was a sensitive one.

Today Delta is working with suppliers both in collaboration and on a wholesale basis. The supplier collaboration involves data sharing. The business rests on three functions: washing and handling, rental and sales of outdoor clothing and gear. As the founder expressed: “We contribute to sustainability karma a bit. Or the karma account if you will, by helping insecure customers use their gear longer [by supplying washing services and knowledge for outdoor clothing and down products]; we also sell a lot of detergent and waterproofing”. Delta has partners for mending and logistics. Rental of outdoor clothing generates a large amount of usage-related data, as well as resulting in wear and tear. Items of clothing need to be handled individually in this set-up, and it is very important that IT systems that can support this. For this reason, Delta is putting great effort into the development of its own IT system.

Epsilon was founded in 2018 and managed to grow a sizeable customer base within a short time frame, offering subscriptions for fashion clothes. Its customers were women at the age of 25–40. This firm focused on developing relationships with well-known quality brands to rent out their clothes. It took time to convince brand owners that this rental business would not cannibalise their retail models in the long term. On the contrary, a customer who rents, for example, a high-quality sweater and appreciates it might be more likely to purchase one. Epsilon had a scalable model, in terms of working with partners for dry cleaning and logistics service operations. Trying to reduce handling time between customers was a key priority and focus of the business: “Operations is key to this business model; this is where everything happens” (CEO of Epsilon). Lead times were reduced thanks to the implementation of an IT system, which was important in this process. The IT system was also important for displaying clothes and giving customers alternatives if a specific item was already rented out. This happened quite often, and there were occasions when up to 50 people were in a queue for one item. Raising capital became difficult in the most recent funding round, which led to the business closing. Still, interest in the company remains, and many customers maintain contact.

One of Zeta’s main objectives was to “get people to purchase more second-hand clothing” (founder of Zeta). The company started off small and trialled its service with 30 customers, who each received a box with second-hand clothing items and a purple card with a customer survey. The company used a subscription-based model, and customers received a monthly box of garments in their style and size, conveniently laundered and delivered. Every customer had to fill out a questionnaire, including questions about their preferred styles and sizes, as well as their likes and dislikes, to build a style profile. A selection of clothes was chosen for each customer by a stylist according to their style profile. Initially, Zeta’s founders purchased the clothes themselves in local second-hand shops in Stockholm; however, when the company grew, they found partners to source overstock items that were not sold by established brands. This included fast fashion brands and some more expensive brands. In return, the partner brands received data and statistics about CO₂ footprint, usage, demographics and customer feedback. The company conducted most operations in-house, including designing its IT system, styling, sewing barcodes, photographing all clothing items, washing, ironing, packing, inspection and repairs. However, it used a logistics partner to send packages to customers.

Ita is a ski resort in Sweden which is exploring how to improve its offering for visiting families. As the owner said: “You can book everything you need on our homepage, ski pass, skiing gear, ski school, private lessons […] clothes for skiing, socks, goggles, back protector […] well yes. And for booking accommodation we have a separate homepage” (Ita owner). Ita already had an established rental operation for skis, boots and helmets, and the company wanted to add ski clothing. For children’s ski garments, Ita has established a partnership with a Swedish clothing brand. For adult ski clothes, Ita turned to a supplier that it had previously worked with for other types of clothing, such as staff clothing. Washing and repairs are done in-house. This was already the case for staff clothing, so consequently, it had the necessary facilities for washing, mending and waterproofing.

In providing renting services for clothing, all cases above deal with resources connected to inspection, washing, ironing and repairs. In some cases, they also provide a waterproofing service. In addition, all cases work with resources for displaying clothing items (in a shop/showroom and/or online) and building a homepage. Some of the firms have resources for packing and delivery and some work with logistics partners.

In Section 5.1 below, the cases are analysed with regard to resource interactions in renting systems for clothing items. This is done by considering the focal clothing items and connected resources of the models. Then, in Section 5.2, an analysis is conducted of how value is created through the resource interaction patterns of resource mobilisation, utilisation and combination, respectively. This altogether forms the basis for answering the RQs.

The early cases, Alfa and Gamma, are characterised by a focus on exploring sharing economies and establishing non-profit associations with a group of paying members and can, therefore, be classified as “membership-based models” (see Melander and Arvidsson, 2021). These models primarily centre on developing knowledge on possible ways to achieve ecologically desirable outcomes, which involves questioning consumption habits and exploring sharing economies. Garments are critical resources in these models, initiating sharing among people with the aim to promote more environmentally sustainable lifestyles. Other critical resources are premises that support interaction and knowledge exchange regarding possible ways to deal with the negative environmental effects of clothing. A third type of critical resource is volunteers, who work as purchasing assistants, manage events and inspect, repair, iron and package garments. Intangible resources, such as knowledge and skills for promoting the development of more sustainable lifestyles, were mobilised through a common goal to explore sharing economies and question consumption habits. Media coverage related to the rental companies’ activities is an important external resource related to marketing, shops and events, which attracts people who share this goal. Media coverage also helps create a steady in-flow of second-hand garments from people looking to dispose of clothes in a way that minimises harm to the environment. Another important resource for ensuring the in-flow of garments is relationships with designers with clear sustainability profiles.

Following a period of early exploration of rental models, clear attempts at commercialising emerge. All of the following models offer monthly subscriptions for customers; we refer to this category of model as “subscription-based models”. This model resembles what Arrigo (2021) refers to as access-based fashion for individual garments and has similarities with subscription models from other industrial contexts (Kowalkowski and Ulaga, 2024). The founders of Beta, Epsilon and Zeta are all connected to the fashion industry and fashion retail. They are trying to combine traditional fashion consumption with ideas of sustainability from within the fashion industry. They focus on forming relationships with suppliers and efficiency in processes. Beta, Epsilon and Zeta focus on resource utilisation. The people involved have in-depth knowledge of marketing, purchasing and the value of customer service. Among Beta, Epsilon and Zeta, there is also a high degree of interest in tech solutions and efficient logistics. Hence, critical resources used in these models include marketing, procurement, operation management and tech competences. Together with market data gathered and stored in the companies’ IT systems, these competences support the provision of a customised offering, satisfying customers’ desire for change (Armstrong et al., 2016) in a way that may limit the harm of their consumption on the environment (cf. Melander and Arvidsson, 2021). Another important resource in providing customised fashion is the companies’ styling competences.

Apart from being critical resources in providing a customised fashion offering, market data makes the renting companies attractive business partners for garment suppliers, which, in turn, helps them achieve resource efficiency by reducing their own capital being locked into garments. However, the cases differ with regard to the establishment of partnerships to access or acquire other key resources (for inspections, repairs, ironing, storage, packaging and transport), which impacts resource efficiency and scalability. From the three cases, one company closed down due to high costs associated with conducting all business activities in-house, requiring a large warehouse and a large number of employees. Another company relied heavily on its physical showroom for customisations and had to close due to COVID-19, which resulted in its customers working from home. The third business closed due to the significant demands for growth associated with external funding. This model had the greatest potential to be scaled up due to the presence of partners for laundry services and a suitable logistics provider, as well as the central mobilisation of resources.

The businesses operating in outdoor clothing, Delta and Ita, are flexible and share similarities with the single transaction model described by Ritter and Schanz (2019) but with a focus on expertise, activity specialisations and a very high level of flexibility for customers. Both cases also rely on their close proximity to skiing resorts as well as renting other types of equipment. The outdoor-based model is referred to as “individual garment renting”. As in the two other types of models discussed above, the combination of garments with other resources is key. The businesses offer convenient pick-up locations and supplementary products such as tents and ski equipment. Other critical resources are the usage data gathered and stored in the companies’ IT systems and their websites, which display the entire assortment of garments available (including garments currently being rented by customers) and thus make all garments available for customers to choose from. This not only provides value to customers by increasing their range of choices but also supports high garment utilisation by making it possible for customers to book individual items in advance. In addition, the single-garment rental models represented in this case study provide customer value by making bulky, seldom-used high-quality garments available in proximity to their place of use, thereby reducing customers’ costs for acquiring, storing and transporting garments. Moreover, usage data, enabled by rentals of a large assortment of different products for limited periods of time, provides important value for suppliers by supporting the development of high-quality garments. This is, therefore, a resource that supports the development of supplier collaborations that can help reduce rental companies’ own capital being locked into garments. See Table 2 for an overview of vital resources.

There are many key resources in use in renting models for clothing, as seen above. For example, use and market data, physical and digital stores, supplementary products, procurement and styling competences, repair equipment and space for handling and inspecting clothes. How those resources are mobilised, used and combined constitutes the resource interaction pattern, which, in turn, defines the value creation logics of rental models. The resource interaction patterns, with regard to resource mobilisation, resource utilisation and resource combination, differ among the three models (see Table 3).

The membership model is based on resource mobilisation within the community and, to some extent, the combination of focal resources and re-use and co-use within the sharing economy. However, economic sustainability seems not to be a core value of the model, as illustrated by the fact that non-profit associations are the main driver. The focal resource, clothing items, constitutes a facility, but utilisation is not a main priority. Resource mobilisation, such as from within the community, and resource combination through re-use and co-use are the main drivers of interaction within the community. Thus, it plays an important role in supporting the exploration of ecologically desirable outcomes and developing more knowledge on how to achieve more environmentally sustainable lifestyles.

The subscription model is based on resource mobilisation through supplier collaboration and resource utilisation. There is a challenge in balancing mobilisation with securing new stock and, at the same time, treating clothing items as facilities and maximising their use. Hence, in this model, the clothing items are key facilities that create value through their combination. The resource combinations need to be continuously updated and/or developed to make sense to the customers. In this way, the input of garments is key to the value creation logic. Maintaining good contacts with second-hand shops was important in one of the cases, while the other two cases developed contacts and relationships with well-known brands. The suppliers were at first hesitant to have their clothes rented, but over time, saw the opportunities in terms of reaching new markets. Besides supporting customised fashion based on a regularly updated assortment, collaboration with suppliers is necessary for mobilising resources in a way that reduces capital locked into goods. In other words, the value creation logic centres on combining fashion personalisation, resource utilisation and resource mobilisation from suppliers. Another important characteristic of the subscription-based models was the dual role of garments due to the aim of offering resource-efficient customised fashion satisfying customers’ desire for change. While initially being rented out and viewed as a facility that needs to be used as much as possible, the garments are finally sold as products at the end of the season to make room for new garments that reflect current trends. Hence, the dual role of garments is another important part of the value creation logic that may also present a challenge for building an economically viable business set-up.

The individual item model relies on resource mobilisation and closer and more mutual collaboration and resource combination. This model is similar in one way to a retail model since it is centred around one-resource items. In this model, clothing items are usually of high quality and specialised for certain activities. Besides the right garments, the value creation logic centres on making these garments available rather than their utilisation. Furthermore, the value of the key resources (garments) largely depends on the connected resources in terms of both sports equipment and skiing opportunities. Without this particular context, the value of the individual resources would be much harder to foresee. What is interesting is that this model, similar to the subscription-based model, involves supplier collaboration but is more mutual in nature. The importance of collaboration in renting models is also seen in other studies (Melander and Arvidsson, 2021). The collaboration involves new product development, with new knowledge regarding user behaviour being obtained from renting individual garments. This may give rise to even more high-quality clothes, which, in turn, can be of value for the start-up and consumers.

Pursuing renting models in the context of the textile and garment industry appears to be challenging, as evidenced by the fact that several of the studied firms have gone bankrupt. Still, there is a need for new business models in this industry in light of sustainability needs (Abreu et al., 2021; Dominidiato et al., 2023; Guercini and Runfola, 2021; Pedersen et al., 2018). However, renting models alone will not solve the problem of transitioning to a more sustainable textile and garment industry, which will require highly complex development (Akrout and Guercini, 2022). Our perspective is that a plethora of business models for sharing resources will be needed in this transition, and renting models can contribute in this regard. One such role is clear in relation to the membership model. This model is focused on exploring the sharing economy, with the main objective being to offer economically viable products and services with minimal damage to the environment, thereby contributing to the transition to more sustainable consumption. In this way, the model aims to change consumer behaviour and build a community through membership and events, bringing together people who share similar environmental concerns and are striving to contribute to a more sustainable society. This is in line with Runfola and Monteverde (2023), who also stress the importance of community in the context of sustainable business models in fashion. The more commercial renting models, the subscription-based model and the individual rental model can also play a role in building a community around sharing resources by having consumers rent garments instead of purchasing them. Importantly, these commercialised models play a role in fostering collaboration and building relationships with the established actors in the industry, the brand owners. Relationships with suppliers involve activities such as sharing market insights to improve product development. These relationships involve both resource utilisation and resource combinations and may contribute to the business network changes needed (Guercini and Milanesi, 2019) to move away from fast fashion.

The collaborations between the start-up companies and suppliers (brand owners) could potentially have been further developed, especially under the subscription-based model. The rental companies’ inventory costs were reduced through the brand owners retaining ownership of garments. This, in turn, required offering something of value in return. An important resource in this case was customer and usage data stored in the IT system, providing information about how many times a certain garment had been used, washed and repaired. The value of combining this resource with the brand owners’ design and assortment planning could have contributed to extending product life cycles and increasing product usage at larger scales. There was an unrealised potential herein. This was included in the subscription model’s value creation logic to some extent by being part of creating preconditions for resource utilisation and resource combination (e.g., showrooms, stylist competence, IT system and business relationships) supplementary to the focal resources (i.e. the garments).

It should be noted that the one renting model found to be economically sustainable was the individual item model. This model creates value for consumers in situations where they need expensive, bulky, low-use products such as ski jackets and ski pants. Both cases that pursued this model achieved economic sustainability. This model primarily focuses on resource combination with nearby resources. It is interesting to see that the value of specialised clothing items and equipment is based on how they are combined and used in the context of skiing resorts, showing that the value of resources is not a given but rather depends on how they are combined (Håkansson and Waluszewski, 2002; Penrose, 1959), as formulated in the assumption of heterogeneity.

The studied cases were start-up companies, which presents them with both opportunities as well as limitations. Start-ups often have novel and promising business ideas, but they typically exist outside of established business networks and forming business relationships is often crucial for their development (Aaboen et al., 2016). Moreover, building business models around technology-enabled environmental sustainability adds further complexity to the already challenging situation for start-ups (Geissdoerfer et al., 2018; Jorzik et al., 2024). Start-ups typically have limited resources and are dependent on various forms of capital. This emerged as a challenge for the cases developing subscription-based models since they were evaluated on the principles of so-called tech firms, which became problematic.

One challenge associated with renting models in general, and the fashion context in particular, is rooted in the seasonal fashion logic. The focal resources within renting systems are garments purchased as products from brand owners and then rented out and used by customers. Therefore, the products are the core facilities of the focal firms. In some cases, these facilities are occasionally sold as second-hand garments to customers to finance the purchase of new-season items, as seen in other studies of fashion rentals (Arrigo, 2021). This means that the start-ups are selling their main facilities. Those facilities have been used multiple times and are worn, aged and modified versions of the original products. Given that the 4R model (Håkansson and Waluszewski, 2002) is developed for a B2B context, it is not self-evident that clothing items should be viewed as production facilities. With regard to rental models, when the rental products are sold off, they appear to have served a dual role as products and production facilities in value creation. Actors try to increase the life cycle and uses of core garment facilities but at the same time rotate them. This might be seen as one of the “paradoxes” of the fashion industries (Akrout and Guercini, 2022; Guercini and Runfola, 2021). Learning more about the dual roles and interplay between products and facilities may be an important step in the realisation of renting models and, in turn, the transition to sustainable business models.

The aim of the paper is to explore renting systems and their value creation logic with a basis in resource interaction patterns. This was done by analysing tangible and intangible resources and how they are best used in the best feasible ways to increase resource utilisation – the main rationale of sharing-based models. The paper adds to the understanding of business models for sharing resources (Melander and Arvidsson, 2021; Pedersen et al., 2018; Öberg, 2023). It does so by identifying three categories of renting models (the membership model, subscription model and individual item model) based on their different value creation logics. While the membership model is primarily reliant on resource mobilisation in the community, based on a sharing economy and strives to contribute to the transition to more environmentally sustainable consumption, the subscription model is more focused on resource mobilisation and resource efficiency. This model proved difficult to implement, and all the cases applying this model have closed down, raising questions about how economic sustainability can be achieved in this way. However, this model creates economic value for fashion consumers primarily seeking ways to deal with limited time, styling competence and money when designing their wardrobes. Finally, the individual item model primarily focuses on resource combination with nearby resources, and there is a clear combination effect present in this renting model. All three categories of the renting model take an extended period to realise since resource utilisation is the rationale, and mobilising resources and resource combination requires support from business networks (Bankvall et al., 2017; Guercini and Runfola, 2021).

The paper contributes to an improved understanding of the interplay between resources in the RIA framework (Baraldi et al., 2012; Finch et al., 2012; Silvestri et al., 2022). Firstly, it conceptualises the value creation logics of renting models based on how resources are mobilised, used and combined. The three categories of renting models show different resource interaction patterns. Secondly, it emphasises the role of resource combination in developing resource-efficient business models, i.e. where the utilisation of each individual product (in our case, each individual garment) is kept as high as possible by using additional resources to keep the time down the product spends at the renting company. This perspective on products blurs the 4R model’s separation of technical resource units into products and production facilities. Instead of being viewed only as a product that creates a certain value for customers when combined with other resources in the use context, the same resource can now also be viewed as a production facility that, by being highly used, may allow providers to benefit from economies of scale.

Following from the above, we presented important implications regarding the textile and garment industry and particular actors in the fashion context. The paper thus contributes to increased awareness of the dual role of clothing items in renting models, which may inspire fashion companies to increase the lifetime and uses of garments and thereby take an important step towards developing more sustainable business models (Adam et al., 2018; Arrigo, 2021; Guercini and Runfola, 2021; Runfola and Monteverde, 2023). Moreover, this paper offers implications for capital systems in that it sheds light on the important aspect of considering renting models not as tech start-up business models with fast return-on-investment but sustainable start-up business models in which investments take longer before showing results. This change of mindset may be an important but necessary step to support new actors in the context of sustainable development. Moreover, sustainability in fashion industries is complex and paradoxical (Akrout and Guercini, 2022; Guercini and Runfola, 2021) and renting models alone cannot solve the issues ahead. However, as shown, new business models for sharing resources, such as renting models, can contribute to sustainable consumption and disseminating sharing economy principles, both in relation to consumers and established brand owners. The managerial implications for brand owners are to be open to new business models and see the potential in collaboration with newly established companies. Collaboration with start-up firms could sow the seeds of sustainability (Jorzik et al., 2024).

Suggestions for future research include developing a deeper understanding of the plethora of business models aiming to improve sustainability in the textile and garment industry. Different models for sharing resources and sustainability initiatives will be needed and will need to be integrated. One new model will not bring about change alone but could be the start of scalable changes. Future research thus needs to encompass the business networks of connected resources involved in those new business models. There may be opposing as well as supporting actions and interactions in relation to sharing, resource ownership and use. If we can understand the business networks and their dynamics, we will learn more about the changes necessary to achieve a more sustainable future.

This study has been supported by the Swedish Energy Agency (P2022-00144).