The gross margins, by selling Direct to Customer, are just so much better. Plus we have excellent word of mouth. We have retailers asking to stock our product - and we do work with some - but I’m struggling to see the benefit of selling at a wholesale rate (less than our direct customers pay) in order to go into retail stores.
I see you do a combination of both. Could you outline benefits of wholesale, and why you’ve gone this route? I’m assuming it’s a multi-layered decision and would love to understand the nuance of that decision. Thanks so much for your time and energy. Appreciate you!
Yes, we do both. We built our business on selling to retailers at wholesale, and in the background built out our ecommerce program. Wholesale for us moves very large volumes, and allowed for price improvements on our production costs which has led to better pricing at retail for a premium product. The sales at retail are also very targeted, so you’re getting in front of shoppers who are making buying decisions then and there. For our products, it works well. We service retailers directly, and through distributors but we don’t drive our product around town or country delivering from our own vehicles.
If your D2C revenue and profits are stronger, and you have a good understanding of that channel and drivers, then double down there but ultimately, nearly all growing brands end up selling in both channels.