PHILADELPHIA — A little talked about but growing market is the furniture rental space. Dominated by a few companies, the furniture rental service market size is projected by Fortune Business Insights to reach $139.05 billion by 2029. It was $67 billion in 2021.
With that expected growth, there is room for more than just a few companies, and one of those at Home Delivery World 2022 is Fernish. Founded in 2017 by Lucas Dickey and Michael Barlow, the furniture rental company continues to see its market grow and now services six areas including New York City and Washington, D.C. The company is also in Southern California, Seattle, and the Dallas-Fort Worth and Austin, Texas areas.
According to Fernish, 9.8 million tons of furniture ends up in landfills each year. Pitched as a circular company, Fernish seeks to give furniture second and third lives. Renters typically keep the furniture for 12 months (rentals can be for shorter or longer periods) with one renewal. At the conclusion of that renewal, many customers choose to purchase the items outright, but those that are returned are refurbished and re-rented, liquidated, donated or sold as used, Kristin Toth, president and COO, told Modern Shipper.
Fernish’s furniture partners include CB2, Crate & Barrel, and Floyd, although Toth said the company has started to “move upstream to some wholesalers” and has even started designing a few pieces itself.
Toth said Fernish initially partnered with third-party providers to deliver, assemble and pick up its furniture, but it found the cost a bit much. The company has now built its own delivery and assembly service in each area it serves.
“As we grow in scale, we have peak times and we’ve found some partners [to help],” she said, noting that she was walking the Home Delivery World floor exploring potential delivery partners to help handle some of those times.
While the focus of the company, which has raised just over $58 million, according to Crunchbase, has been on furniture and building a circular economy, it has found itself in the logistics and warehousing business.
In California, Fernish opened in Los Angeles but wanted to also serve the San Diego area, Toth said, so it had to open a crossdock facility. On the East Coast, a warehouse helps feed both the Washington, D.C., and New York City areas.
Fernish promises delivery of items within seven days, so it purchases and stores items in warehouses. Initially, the delivery area was within 50 to 75 miles of a facility, but as “we evolve, we’re going to expand where we go from our warehouses and build more of a hub-and-spoke model,” Toth said.
Supply chain challenges have pushed some furniture deliveries out to nine months or more for some customers, but Toth said constant communication that began prior to the COVID-19 pandemic has helped Fernish weather some of these challenges. There are some items that Fernish could have delivered more of, but it has worked to ensure only those items in stock are displayed in its online catalog.
Focused primarily on home furnishings — living room, dining room, bedroom and office — Toth said Fernish has a small B2B business built mostly around corporate moves that involve outfitting an entire apartment or house. The company did see a spike in desk and chair rentals once the pandemic started.
The goal for all the furniture Fernish rents is to either sell it to the customer or re-rent it to a second customer. Assuming a four-year life cycle for its items, Fernish is profitable on its business plan, and helping save the planet at the same time.
