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Yes, handbag subscription is the new reality

Updated: Apr 7


I recently had the opportunity to speak at the Asset Finance International Conference, where leading banking, leasing and captive financing professionals had gathered from around the world to talk about future trends.


Leasing as a service was invented to enable customers to benefit from things they would not purchase or be able to afford. I drove to work in a leased car and typed this article in a leased office using leased office equipment. I wouldn’t have access to any of them if I had to buy them outright. Nevertheless, I’m surrounded by appliances, clothes, bags, technology, and countless other items that I bought rather than leased or rented. Why?


Fashion as a Service is one of the trends born out of a people’s need to maintain their chosen lifestyle without having to commit to the full retail price. The increasing demand for handbags that customers can rent and switch whenever they like rather than investing in owning their own, got me wondering about how the asset financing aspects could be matched to fashion industry specifics.


High-quality, branded handbags have long been a desirable status symbol, a much sought after item on the resale market. This latter fact is one of the key criteria upon which to build a financial model.


To start with, we must address a number of important considerations including risk management, building an approval process, developing leasing solutions that are appropriate for Fashion as a Service and building customer loyalty.


Speaking on stage at the conference about a subscription industry that can transform a traditional concept like handbag “ownership” into a financial subscription service, I got a question from the audience: “Are you joking or are seriously telling me that my wife will soon be leasing her latest handbag?” Technically, the process is similar to any other asset financing model and can be applied to kitchen furniture, jeans, and sunglasses as well as countless other fashion and household items.


Today, boundaries are blurring as manufacturers and brands leverage new asset-as-a-service business models on a wider range of physical assets. The key secret remains in defining and communicating the core value for the customer and ensuring a smooth user experience. By the way, there is a handbag subscription service already available for example Ivory Clasp and The Realreal — the leader in authenticated luxury consignment, that made IPO last week on a New York stock exchange.


The next step will be genuinely branded and debt-financed Fashion As A Service, Appliance As A Service, Device As A Service… the list goes on and on.