A super model: Why this dress-for-hire startup believes the sustainable fashion trend will be good for business

Observing that the dress-hire industry was booming in the US and growing in Australia, Melanie McNaughton opened Her Style AU, a fashion-forward hire destination which stocks Australian and international designs.

Launching in August last year, the business achieved turnover of $25,000 in their second month, was on track to record an annual turnover of $200,000 and opened its first physical store in Ivanhoe, Melbourne, early this year.

It had grown from a staff of two —McNaughton and her partner Jarred, who works at PwC — to a team of five, and its growth enabled McNaughton to leave her accounting job at Deloitte to work on the business full time.

McNaughton says the bricks-and-mortar store was open for a just few weeks before COVID-19 hit, forcing them to shut their doors and relinquish staff. It also led to a drop in sales.

“When we [closed] we had rent obligations, and had bought stock wholesale [that] we budgeted for based on turnover. When you don’t have that turnover coming in, you see your accounts depleting quickly,” McNaughton tells SmartCompany.

She worked with suppliers to cancel or delay upcoming collections, and was able to receive rent reductions and government wage subsidy programs which helped to relieve some of the financial pressure. With restrictions being eased across the country, she says she is starting to see an uptick in sales.

“The correlation between hiring [and the easing of restrictions] was almost instantaneous,” she says.

“On average, we were seeing 50 hires per week and now we’re doing five to ten. That’s quite a dramatic drop, but we’re starting to see hires come back, especially in Perth and Queensland, where restrictions are less intense. The Melbourne hire market is picking up as well.

“People are hiring for birthdays, smaller events they might not have considered hiring for in the past [and] events that have been pushed back.

“It’s not an instant ‘back to normal,’ but it’s happening at a slow pace.”

Dresses you might not wear twice

McNaughton says the trend towards sustainable fashion gives her confidence that there will be ongoing growth in the dress-rental market.

She says customers are more conscious about the environmental impact of their clothing, and are less willing to purchase dresses that are only worn for one-off occasions.

“People like that they can hire [clothes], send it back to us and we clean it. It’s an easy process, and they can hire things that they might not [be able to] buy,” she says.

“That includes clients who wouldn’t buy a $3,000 Zimmermann dress, but would love to hire it and take fashion to the next level.”

McNaughton expects trade to accelerate in August, before racing season in October and November, which is their busiest period.

“Winter is generally quieter for the dress industry as less people go out, and there aren’t as many events like weddings,” she says.

“Most of our customers will book 1-2 weeks in advance, but we’ve already received bookings for [August.]

“I think people are still a bit nervous about committing to events in the future as well.”

The industry is in its infancy

While there have been “no massive benefits” from this period, McNaughton says she has been able to implement different strategies including a parcel chute for 24/7 drop-offs, which benefits customers working during traditional hours.

McNaughton says Her style AU is looking at ways to avoid wholesale stock commitments, as well as a business model where it has “multiple businesses within our business”.

“We want to establish a one-stop-shop for hair, dresses, make-up [and so on] in a large warehouse setting. It’s the next step forward, and we are looking for investment.

“At the moment it’s been put on hold, but it’s in our one-to-two-year plan for sure.”

She adds that the dress-hire market is undergoing significant growth in Australia.

“In America, they have dress hire in every shopping centre,” she says. “The industry is in its infancy [here] but it’s definitely on its way up even among this crisis.”

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