Word leaked on Tuesday that furniture giant Ikea plans on exploring a furniture leasing program, but anyone hoping for a sneak peak at what the service might look like are only left to speculate, as details are scant and the program is in its “very early stages,” according to an Ikea spokesperson.
Here’s what we do know: The program will start in Switzerland and begin by leasing office furniture to business customers who’d rather not pay the full price to stock their office, which would help for any company on a short-term lease. Ikea is also looking at leasing kitchen designs.
The move comes at a time when furniture makers are becoming increasingly aware of the huge amounts of furniture thrown away every year. According to the EPA, 9.8 million tons of furniture were thrown away in 2009, accounting for 4.1 percent of household waste. Given Ikea’s emphasis on low-cost flatpack furniture, the company is undoubtedly responsible for its fair share of that waste.
How and to where Ikea’s furniture leasing program might expand is unknown for now, but there’s already a few companies that have taken a stab at the idea, including Fernish—which just raised $30 million in capital last month—and Feather, which launched in April 2017 and currently operates in New York and San Francisco. A look at the latter’s pricing model offers a glimpse into what Ikea’s program could look like.
“We’re trying to change the relationship that people have with material goods to create a healthier and happier planet,” said Feather founder Jay Reno. “Our consumer is really somebody who is previously buying furniture and we’re getting them to subscribe to furniture instead.”
Feather’s service works like this: Customers can rent packages of furniture or individual pieces furniture for a monthly fee. The company is stocked with everything from living room sofas to baby cribs to mattresses. Rental plans run for one year, but the customer can opt out at any point before or after one year by either swapping out the piece or pieces for free, returning the piece or multiple pieces for a flat $149 fee, or buying products outright.
Buying a piece costs the full retail price plus a 10 percent fee, but all previous monthly payments count toward the purchase price if you do decide to buy it. If you return the piece within six months there’s an additional charge. If you end up paying more in monthly fees than the cost to buy it—which can happen if you lease the piece for more than a year—you can claim it as yours without any additional charge.
Is this a good deal for customers? Curbed crunched the numbers on a sample of 20 pieces and packages of furniture on Feather to find out. In a situation where you’re pretty sure you’re going to move in one year and will want to return it after that point, you get better value the more furniture you rent, and the more expensive it is.
For example, the company’s Lincoln Sofa retails for $2,699 with a monthly charge of $119. If you rent it for a year and return it, you will have paid a little under 60 percent of the sofa’s retail value. On the $899 Imperial Sofa with a monthly charge of $45, will have paid a little less than 70 percent of its retail value if you return it after a year.
But if you’re only renting a single cheap piece of furniture, the numbers swing the other way. The Piha Side table retails for $169 and leases for $8 monthly. If you return it after a year, you will have paid 45 percent more than its retail price. For the Casper Mattress ($595) and the Budgie Convertible Crib ($449), you’ll just about pay the retail price if you return it after a year.
If you end up renting a piece of furniture for two years, you’re almost guaranteed to pay more than the retail value. In the case of cheaper items, you might pay twice as more. For the more expensive items like the Lincoln Sofa, you’ll pay just about the retail price after two years and return it.
Of course, there are other considerations. Even if you pay significantly less than the retail price of a sofa you rent for a year and then return, you still have to come up with another sofa when you land your next pad. Conversely, if you decide to buy a sofa on your own, you might end up paying considerably more in moving costs than if you’d just rented your furniture from Feather and paid the company a $149 flat fee to take any or all of it back.
And if environmental concerns weigh on your conscience, it may be worth it to you to be less than perfectly economical to know your consumption habits aren’t contributing to the millions of tons of furniture waste disposed every year.
In the end, it all comes down to how much you value the flexibility to move without having to deal with getting rid of your furniture.
Correction: A previous version of this article suggested that Ikea was founded in Switzerland; Ikea was founded in Sweden.