I recently read a great HBS case study on Rent the Runway, and we've recently completed a tuxedo rental e-commerce site for another competitor of the Black Tux.

The economics of it might look something like this:

Middle-Tier Tux:
Retail price of tuxedo $500
Wholesale cost of tuxedo $215
Cost of tuxedo to online retailer $150 (negotiated)
Revenue per rental $60 (just the tuxedo, not accessories)
Variable cost per rental $20 (shipping, stains, cleaning, etc.)

So if you're paying $150 for the tuxedo, and you rent it out just 4 times, you'll be above break even ($60/rental - $20/rental/fixes = $40 profit / rental, x 4 = $160).

This is a real world example FYI. In terms of inventory requirements, that's going to depend upon your business. Rent the Runway has TONS of dresses. But they started out with a limited supply and grew from there. The Black Tux keeps their selection limited and high quality, which I'm sure helps them manage their inventory easily, run numbers constantly and make sure they are running everything appropriately from an inventory standpoint. I wouldn't be surprised if they had product ready to be added to their distribution at the drop of a hat, especially for busier seasons such as prom or summer (weddings).

I hope that helps. Happy to answer more questions for you.

100% agree with Joseph. There are lots of variables here to consider. In addition to how much you've spent, there's the variables of resources for Magento vs ROR that you have, budget that you have, and time that you have.

For instance, we only recommend doing a custom solution (ROR in this case) if you have a large development budget and ample extra budget for changes and revisions, as that's custom development work, which is expensive.

If you have a very tight budget, we recommend Shopify or BigCommerce, spending very little on custom website design and investing in content (great branding, photography and blog posts) and marketing (aggressive social marketing which can be measured and optimized for growth).

Lastly, if you're in the middle on budget, we recommend doing a dedicated installation with an existing solution, such as Magento. We do highly recommend limiting the number of extensions as well, as, again, they can be great but they can also interfere with each other. Magento's technical structure is such that it is somewhat difficult and finnicky to remove plugins, so you need to be very careful with them in the first place. You'll also need to set up a staging server as well.

We've recently completed a bunch of sites on Shopify Basic and Shopify Plus (enterprise), and love Shopify moreso than Magento. We are also in the midst of trying Spree, which I've heard great things on.

Hope that helps!

Hi,

I'm the Principal at Verbal+Visual, a digital product studio in NYC (verbalplusvisual.com).

This is a fair question. From our experience, both in creating apps and using apps, I can tell you that your app, and your business, will fair much better if the branding, user experience and user interface are top notch. If something is designed well, is easy to use, and gives the end user trust, they will be much more likely to use it. Think about any app you see that is professionally designed versus one that is not professionally designed. No matter how great the actual app is, you're less likely to use it if it doesn't look the part. Our data on the apps we've worked with Penguin and Kidney Cancer Association confirms this partially, but data from a startup app we did wholeheartedly endorses getting the design and branding done right the first time around.

Please let me know if you'd like to schedule a call for any follow up questions.

Thanks!

Anshey

Take a look at the core of what you need to know here:
http://startupfashion.com/fashion-ecommerce-website

I answered these questions for those starting their own eCommerce store, and that is a great resource for you to get going! Feel free to reach out to me directly for more tips, we can set up a call.