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Omnichannel works when you run wholesale and owned retail as separate P&Ls with different margin targets and strategic goals.
7 new brick-and-mortar stores
this year while simultaneously launching wholesale distribution with Bloomingdale's
40-50% of retail price
for department store partnerships
50% margin haircut
on the wholesale volume
Bylt, a men's apparel brand that built its business direct-to-consumer, announced plans to open 7 new brick-and-mortar stores this year while simultaneously launching wholesale distribution with Bloomingdale's, according to Retail Touchpoints. The dual expansion — owning retail real estate while also selling into a department store chain — represents a channel strategy most physical-product brands consider mutually exclusive.
Bylt will operate company-owned stores in specific markets while placing product in select Bloomingdale's locations. The brand did not disclose the number of Bloomingdale's doors or the product assortment, but confirmed the wholesale partnership is targeted rather than a full chain rollout. The company-owned stores give Bylt full control over merchandising, pricing, and customer data. The Bloomingdale's placement gives them access to a different customer cohort and geographic coverage without the capital cost of opening in every metro.
This works because Bylt is treating the two channels as distinct businesses with different economics. Company-owned retail carries the overhead of lease, staff, and inventory, but captures full retail margin and owns the customer relationship. Wholesale to Bloomingdale's operates at a lower margin — typically 40-50% of retail price for department store partnerships — but requires no real estate investment and carries minimal customer acquisition cost. The brand is not trying to optimize one channel. They are running two separate P&Ls that serve different strategic goals: owned stores build brand equity and customer lifetime value, wholesale drives volume and market penetration.
The underlying mechanism is margin segmentation. Bylt can afford to sell into Bloomingdale's at wholesale rates because the company-owned stores and DTC site generate enough high-margin revenue to subsidize the wholesale line. The wholesale partnership is not expected to be the most profitable channel; it is distribution that pays for itself while expanding reach. Most brands fail this model because they try to make wholesale as profitable as DTC, which forces them to either raise wholesale prices (making them uncompetitive on shelf) or cheapen the product (destroying brand equity). Bylt avoids this by accepting that wholesale is a volume play funded by margin from owned channels.
A small physical-product brand runs this play by opening one owned retail location or operating DTC at scale first, then layering in wholesale only after the high-margin channel is profitable. Do not approach a retailer until your DTC or owned-store operation can withstand a 50% margin haircut on the wholesale volume. When you pitch the retailer, offer a product assortment that is distinct but not inferior — same quality, different SKUs or colorways — so the wholesale line does not cannibalize your owned channel. Start with a test: one regional chain, limited door count, specific zip codes. Track sell-through weekly. If the retailer reorders within 90 days, expand doors. If they do not, the product was wrong or the price was wrong, and you fix it before scaling. Build the wholesale line as a separate business unit with its own inventory forecast, its own margin target, and its own success metric. The DTC or owned-store channel measures LTV and repeat rate. The wholesale channel measures door count and turns.
Bylt's move is a signal that omnichannel is back, but only for brands with the discipline to run multiple margin structures simultaneously. The brands that fail are the ones that try to make every channel equally profitable. The brands that win treat each channel as a tool with a specific job.
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