Armoire, a fashion startup for professional women, had its best month ever - then the world started working from home. Here's what it's doing to survive the crisis.

• Startups in the fashion industry are facing an existential threat thanks to public health orders instructing people to forgo social gatherings and work from home.
• A wave of cancelled subscriptions to Armoire Style, a Seattle-based startup that specializes in renting clothes to women, forced the startup into crisis-management mode.
• In an effort to avoid layoffs, Armoire CEO Ambika Singh is reducing her salary to $1 and the rest of her leadership team is also taking a pay cut.
• The company is also slowly turning back the tide of cancelled subscriptions by pivoting its services and doubling down its existing community of customers.
• Visit Business Insider's homepage for more stories.

For Armoire Style, a small Seattle-based startup that rents dresses, professional clothes and outerwear to working women, the coronavirus outbreak was a crisis that they just didn't anticipate.

"We had the best month we ever had in February, we came out guns blazing," Armoire CEO Ambika Singh told Business Insider. But as the coronavirus outbreak picked up its pace, droves of Armoire customers began to cancel their subscriptions, and forced the four-year old startup into crisis-management mode.

"All of a sudden, our major markets were all in 'shelter in place'," Singh explained. Armoire's customers from San Francisco, Los Angeles and New York City were all working from home and practicing social distancing.

Armoire's team discussed slashing the marketing budget and putting expansion plans on hold, Singh said. The company has also shuttered one of its two physical stores, and left the other open only for dropoffs and pickups.

To avoid layoffs, Singh reduced her own salary to $1 for the time being. The rest of the startup's executive team have also volunteered to take pay cuts, she said.

"Literally every morning we're re-evaluating what's going on," Singh noted. "We're all trying to figure out how long this is going to last."

Fashion in a work from home era

Armoire is by no means alone in its sudden struggle to maintain its customers as the coronavirus outbreak ravages the economy. Buzzy direct-to-consumer startups are all fighting to keep demand level, but startups like Armoire, face challenges particular to the industry: cancelled weddings and parties have erased the need for new dresses, and the increasingly popular directive to work-from-home has caused some to discard pencil skirts and silk blouses for cozy pajamas and flannel shirts.

Within, a digital marketing agency currently tracking the day-by-day effects of the coronavirus outbreak on its e-commerce clients, estimates that companies in the fashion sector are collecting 24% less revenue than the same time last year. That's still better than how it was doing last week, where it estimated that the fashion sector's collective revenue had plummeted to 63% less than the year before.

By doubling down on its existing customers, like working mothers balancing babysitting and Zoom conference calls, Armoire also seems to have found a way to turn around the tide of cancelled subscriptions. Photos on the company's Facebook page show its customers dressing up to enter the home office, or donning a winter coat to sip coffee on the porch.

"We're stepping up our merchandise to include all things comfy and cozy," Singh said, explaining why work-from-home attire could still be helpful. The company has also repositioned its personal styling business to advise customers on spring-cleaning their closets.

"We're trying to listen to our customers and figure out what they need right now," Singh said. "We want to sell something that they want."

And the customers in turn, are helping Armoire out in whichever ways they can to ensure that the startup's revenue continues to flow.

"They're buying a gift card from us that allows them to lock in their subscriptions and make sure we have an ongoing revenue stream," Singh said.

That's a huge boon for the startup, which came out of MIT's seed accelerator in 2016 and has since raised a little over $4 million in funding, according to the Seattle Times (the startup hasn't announced any other funding since 2018).

"We certainly don't have years of cash in the bank," Singh said.

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