On Holding laid out a 2026 strategy centered on expanding its direct-to-consumer business to improve profitability, according to The Motley Fool. The Swiss performance running brand plans to grow the share of revenue from owned stores and its website while managing wholesale growth more selectively. On's management noted that DTC sales carry significantly higher gross margins than wholesale distribution, and the company expects this channel mix shift to lift overall profitability even as it invests in retail expansion.
The mechanics are straightforward. On operates its own retail stores in key metro markets and sells directly through its e-commerce platform. When a consumer buys a $170 CloudMonster through On's site instead of a multi-brand retailer, On keeps the full retail margin rather than splitting it with a wholesale partner. The company is opening new branded stores in high-traffic locations and upgrading its digital experience to drive more first-party sales. At the same time, On is being more disciplined about which wholesale accounts it serves, focusing on premium specialty running retailers and a handful of marquee department stores rather than flooding the market.
This works because the unit economics shift dramatically when you control the sale. Wholesale typically requires a 50% discount off retail to the retailer, who then marks it up. A pair that retails for $170 might wholesale for $85, leaving On with perhaps $45 after cost of goods. Sell that same pair direct and On captures closer to $100 in gross profit. The brand also owns the customer data, the post-purchase relationship, and the ability to drive repeat without competing on a cluttered retail floor. On's challenge was having enough brand heat to justify pulling back wholesale distribution without losing visibility. The company solved that by building credibility through elite runner endorsements and a distinctive product silhouette that consumers actively seek out, making the direct channel viable.
A small physical-product brand can run the same play if it has a defendable product and a way to reach its customer without relying on Amazon or multi-brand retailers. Start by auditing your current channel split. If wholesale is above 60% of revenue and your gross margin is below 50%, you have room to shift. Build a simple DTC funnel: a clean Shopify site, one targeted Meta ad campaign with a $500 monthly budget, and a lead magnet like a fit guide or material story that captures emails. Price your product at true retail—do not undercut your wholesale partners—but offer bundles or limited colorways only available direct. Use email to convert and retain. Track customer acquisition cost against lifetime value. If you can acquire a customer for under $40 and the second purchase happens within six months, you have a repeatable DTC engine. Gradually reduce wholesale to accounts that genuinely move volume or provide strategic placement. The goal is not to eliminate wholesale overnight but to own 30-40% of sales direct within 18 months, which gives you margin room to reinvest in product and customer experience.
The broader pattern is that brands with strong product-market fit and recognizable identity can afford to be selective about distribution. On is proving that you do not need to be everywhere to grow. You need to be where your customer expects quality and you need to own enough of the sale to fund the next move.
Shift revenue mix to direct channels where you control margin, customer data, and repeat purchase without wholesale drag.
Editorial & Disclosure Notice: This article was written with artificial intelligence from public sources and is published without individual human review. Artificial intelligence and other digital tools are also used for research, analysis, editing, formatting, and production. Errors, omissions, outdated information, or inaccuracies may occur. References to companies, brands, products, services, organizations, or individuals are for informational and editorial purposes and do not imply endorsement, sponsorship, affiliation, partnership, or approval unless expressly stated. All trademarks and other intellectual property remain the property of their respective owners. Opinions, analysis, estimates, and commentary are informational only and should not be construed as financial, investment, legal, tax, medical, procurement, or other professional advice. Information may be corrected, clarified, or updated after publication. Corrections or removal requests: jenny@pops4.com.
The branded-identity layer Chiefs of Staff and heritage CMOs route through — your name imprinted on real authorized stock, your pick of 200+ brands and 70,000 products, shipped from one accountable house. Nine editorial desks publish the intelligence those operators read before they sign.
200+authorized brands
70,000products · virtual proof on each
9 deskspublishing daily
1997one house, since
70,000 SKUs · virtual proof in 60 seconds · no platform fee · blind-shipped · ASI #217876
Your next customer won't visit your website. Their AI will.
AI assistants have quietly taken over the first step of buying — they answer from catalogs they can read and shortlist whoever can actually ship. Two questions now decide whether you exist to that buyer: can a machine read your catalog, and can you fulfill the order. Most brands fail one or both and never find out why the orders went elsewhere. The winners of this shift aren't the loudest. They're the most readable. Build for the machine that's about to do the shopping.
Built by the craft floor — apparel, media, packaging, and secure print.
This trade runs on hands, not desks. Imprint manufacturing & Komori heritage press through approved vendors · Canon high-speed secure-media operations is a craft floor — genuine Six Sigma discipline applied to ink, thread, foil, and registration, where a hundredth of an inch is the difference between a brand that reads serious and one that reads cheap. POPS4 is built by exactly those operators: independent, boots-on-the-ground engineers who carry their own book, read a client in microseconds, and put their name on every run. Beyond our own Virginia Beach floor, we work with a vetted network of craft manufacturers across the US — each meeting the highest excellence in QC standards in the industry, each a specialist in its own discipline — so apparel, hard-goods imprinting, media manufacturing, packaging, and secure printing all go to the bench built for them, coordinated from one accountable hub. Short-run from twenty-five units, volume to five hundred thousand. Two hundred authorized national brands, seventy thousand SKUs with virtual proofing on every one. Art archived for instant reorders. Net-thirty corporate terms, NDA-standard white-label — your name on the work, or none at all.
Strategy, positioning, identity, creative, and messaging — wired into an AI system that publishes and distributes on its own. Nine editorial desks generate the authority, the production house ships the physical proof, and the attribution layer tells you which post sold which SKU. What you get is an operating layer — content, catalog, and order path under one roof — that keeps working whether or not you are in the room. Built for principals who would rather own the machine than rent the agency.
Named-account programs — one desk, quiet delivery, NDA-standard.
One point of contact who already knows the file, so nothing restarts from zero between engagements. The work ships blind, under NDA, with your name on it or none at all. Built for single-family offices, heritage-house CMOs, sports-ownership groups, and the agencies that white-label our production. The relationship is the product; the merch is the proof of it.
SFO · Chief of Staff desk. Principal household, properties, aircraft, yacht, calendar, philanthropy — one file.
Shop seventy thousand products. Virtual proof on every one. 24/7.
Drop your logo on any product and see the virtual proof before asking. Quote routes direct to the desk. MCP catalog for AI agents. Celeste for the fast conversation. Full self-service checkout in development.