Mir is placing orders for the upcoming fall box. The fall box usually contains six products. Currently, 5 out of 6 products have been approved and ordered. The total cost of 5 products is at $39.20 right now. The anchor product and the anchor brand has already been ordered for the fall collection. Mir

is also feeling confident about the three other products that the team has selected for the fall box. He now has to decide on the sixth product and has run into a dilemma. This product has to be a beauty product to compliment the other products in the Fashion Box. Since St. Chicu has a high-end brand image, Mir has to determine if offering an indie/cult product over a luxury product is a wise move. He has received following offers from two vendors.

1-Vendor 1, Mat Lurki, is an upcoming indie vendor who is offering $4.55/unit for an order of 50,000 units. Mat Lurki is also offering 500 units of an add-on product for the members-only platform at 80% off retail. The cost of these 500 add-on units is $14/unit and usually retails for $70/unit. Mir can offer this product at a very attractive promotional price of $39.99 on the members-only website. Mat Lurki is a young, lesser-known brand that started three years ago and has grown rapidly due to its excellent product quality. It is also sold at Neiman Marcus and Nordstrom.

2-Vendor 2 is a well-known luxury brand, Kate Somerville. Kate Somerville is offering $4.95/unit for an order of 50,000 units of the beauty product. Kate Somerville is also offering 500 units add-on units for the members-only platform at 85% off retail. The cost of this add-on product is $9/unit, and it usually retails at $60/unit at various stores. Kate Somerville has approved Mir to sell the product at $34.99 on St. Chic's members-only store.

Both deals have advantages for St. Chic's business and Mir is finding it difficult to make a choice. He needs to take a call in the next 24 hours to meet the order deadline and product delivery targets.

Business Questions

Mir should use the following questions as a guide to the write decision

What is the remaining budget at cost for the fall box?

Does the product cost per unit fits in the remaining cost budget for the box?

How will the cost per unit from each vendor impact markup achieved for the box?

How much will be the total profit from the package deal that each vendor is offering?

What will be the implication of each vendor on the overall perception of the Fashion Box from the customers?

Which vendor would you suggest Mir choose and Why?

What are some of the fashion subscription box business models?

Can you think if any other variation of these models that we are likely to see in future?

How does merchandise buying differ for a subscription-based fashion retailer versus an online- specialty retailer?

What are some of the ways in which a subscription box retailer can expand their market?