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  1. Lifestyle
  2. Fashion

Rent the Runway Is Throwing $200 at Angry Customers

By: Kristen Bahler
Kristen Bahler, expert in Personal Finance. Creates lists for Best Places to Live and Best Places to Travel., and Editor at Money
Kristen Bahler
Editor | Joined July 2016
Kristen Bahler is a writer and editor who shapes conversation-driving stories about lifestyle, money and consumer spending. She helped develop and oversee “Best Places to Travel,” Money’s signature franchise about budget-friendly trips across the globe.
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Published: Sep 30, 2019 2 min read
Rent the Runway San Francisco Ribbon Cutting with Mayor London Breed
General view of the ribbon before the launch of Rent the Runway's West Coast flagship store on May 08, 2019 in San Francisco, California.
Kelly Sullivan—Getty Images for Rent the Runway

Rent the Runway is handing disgruntled customers $200 in cash as it rushes to fix an operations snafu plaguing its supply chain.

Angry comments flooded Rent the Runway's Twitter and Facebook pages this weekend, mostly from customers who never received outfits they’d ordered for weddings, awards galas, and other formal events, and who were unable to reach the the fashion startup's overtaxed customer service line.

Rent the Runway, which started as an e-commerce business in 2009, lets customers rent designer clothes and accessories for monthly subscriptions of $89 and $159. The company opened its first physical location in New York City in 2013, and has since expanded its brick and mortar presence to San Francisco, Los Angeles, Chicago, and Washington, D.C.

Over the last several months, it's raised LOTS of venture capital: In March, Rent the Runway's private market valuation reached $1 billion. In April, TIME named CEO and Co-Founder Jennifer Hyman one of its “100 Most Influential People of 2019.”

But starting September 13, the company has faced an escalating supply chain nightmare due to a software upgrade at its fulfillment centers. As a result, it's been unable to keep up with customer demand.

In an interview with Bloomberg, Hyman said 14% of Rent the Runway subscribers have been affected by the disruption — all of whom will get full refunds on their orders, plus $200 in cash (not Rent the Runway credit). The company is also halting new rental orders and subscribers until October 15, she said.

"You rely on us for meaningful events in your life and to get dressed everyday,” Hyman wrote in an email to subscribers on Friday. “We realize we have let some of you down, and we need to fix it.”