DTC (Direct-to-Consumer)

Direct-to-consumer brands own the entire customer relationship — sourcing or manufacturing the product, marketing it themselves, and selling through their own channels rather than through retail partners.

The trade-off is control against reach. DTC brands capture full margin and first-party customer data, but must fund their own demand generation rather than borrowing a retailer's foot traffic.

Revenue is the product of orders and average order value, sold at full retail margin because no wholesaler or retailer takes a cut. That margin advantage is real, but it must fund the marketing, fulfilment, and returns handling a retail partner would otherwise absorb.

• Contribution margin after shipping and returns — not gross margin
• Customer acquisition cost and its trend as spend scales
• Repeat purchase rate and time between orders
• Average order value
• Return rate, which quietly destroys apparent margin

Contribution margin that stays positive after shipping, returns, and fully loaded acquisition cost. A meaningful share of revenue from repeat customers rather than first orders. Acquisition cost recovered on the first or second purchase. Organic and referral traffic growing as a share of total.

• Subscription DTC — replenishable products on a recurring cycle
• Omnichannel — direct plus selective wholesale or retail
• Made-to-order — production follows demand, minimising inventory
• Marketplace-assisted — direct site plus third-party platforms

• What is contribution margin after shipping, returns, and acquisition cost?
• What share of revenue comes from repeat buyers?
• How has acquisition cost moved as spend has scaled?
• How much capital is tied up in inventory at any time?
• What is the return rate, and how is it trending?