S14 E7: The Truth About DTC and Distribution (with Gulshan Kumar, CEO + Co-founder of Swishables)

0:00Nik:Welcome back to Limited Supply, the podcast where we get deep into the tactical and strategic side of e-commerce, digital marketing, and building consumer brands. I'm your host, Nik Sharma. I've spent the last nine years building, scaling, and investing in brands. And through this show and my weekly newsletter at Nik.co slash email, I'm here to share everything I've learned. The wins, the losses, the experiments, the tactics, and the insights, all so you can unlock your next$100 ,000 in revenue. Today's episode is a good one, but before we dive in, let me tell you about our chosen sponsor for this week's episode.

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1:07Nik:Then it sends it at the exact moment that that shopper is ready to buy. BFCM is behind you and now's the time to build for your biggest year yet. Old and lame retention emails are so 2025. Book a demo by December 31st and get 50 % off your first 60 days at instant.one.sharma and set up your brand to dominate 2026. All right, Galshon, welcome to Limited Supply. Excited to have you here. I think first official Brown member joining the podcast after Moise. How are you? I'm great, man. Thank you for having me on. Of course. I'm excited to jam. So one of the things that is fun about our story is we only met just recently.

1:56Nik:And we met through our mutual friend, Ben Soffer, who created Spritz Society and has the, I forget the name of his podcast, but he's got the podcast with Josh. Good Guys. Josh. Good Guys podcast. Good Guys. Yeah, it's hilarious. And so we met through Ben, met up for coffee in Austin, and then we just clicked. And I was a huge fan of the way that you think about building brands and distribution, really, and even how you came to Swishables, which we'll get into in a second. So I'm excited to have you here because I think you'll also bring a very different perspective than what I normally always talk about, which is really just e-commerce and direct-to-consumer.

2:34Nik:So you're like more omni-channel. Obviously, direct-to-consumer is still a big part of the work you do. But yeah, I'm excited to have you here and excited to dive into it. So to start, why don't you just give a quick intro of yourself? You know, brag as if there's an auntie bragging about you at some dinner party. So thanks for having me, Nick. To introduce myself, my name is Golshan Kumar. I'm the CEO and co-founder of Swishables. What is Swishables? Swishables is liquid mouthwash pre-filled in a sachet that's 100 % recyclable. The way we think about this business is we're not the brand that's going to sit on your bathroom countertop that you typically use for your morning and nighttime routines.

3:19It's all the moments that happen in between that. Once you leave your house, think post-coffee, post-lunch, before a date, before a meeting. You want a quick refresher after you've had a cup of coffee and you're walking into a meeting. We are that hero product that we want consumers to really utilize. You can think of it as an extension of government, just a different vehicle. Also, probably a little bit more portable than those and a little bit more refreshing.

3:48Nik:Amazing. and um i'm curious too so like you know one of the things that i loved about swishables was how thoughtful it was like in every which way from the packaging to the distribution to the name to um you know really everything even even the the pieces around it like the holder for example very thoughtful right um what what are some of the things that like from prior businesses you brought into day zero at swishables or like decided you wanted to build from the ground up And then I want to get into how you think about what constitutes as a good idea. Yeah, I love that. To answer your first question, you know, I think number one, what I'm taking into this business from the previous business is definitely our distribution strategy, right?

4:38I would say 70 % to 80 % of our distribution strategy is going to be very similar. and we can kind of get into my past previous experience and the past brand I've helped built before Swishables. But I think obviously when you're building a CPG brand, anybody who's in this business is going to tell you it's distribution, distribution, distribution, right? I think the way that we approach it because of my past experience, which was selling bottled water for almost a decade, is I probably have a little bit of a different outlook on it. I always tell people, because we sold bottled water for so long and because that category is the category, meaning bottled water exists everywhere.

5:23So when you're selling bottled water and you have a product that's in high demand and everybody's caring about sustainability, what I learned firsthand was how many places that a product can be sold and offered, aka scale right so when i've now anytime i'm thinking of a product or a business obviously like the first question that i'm pressure testing in my head is how scalable is this really right um so that question really came into mind and based on my experience like i said 70 to 80 percent of my distribution footprint and roadmap was going to be very similar so to me i got the green light on is this scalable because a lot of the places I sold water, I could actually sell not wash.

6:10Nik:And when you say scalable, like, can you define that? Does that mean like easy to manufacture? It's reliable to manufacture and fulfill? Like what does scalable mean? Yeah, it definitely has different definitions, right? When I talk about the word scalable is how many places can I sell it? Right? Okay. How many distribution points can I have for this product. In terms of manufacturing and stuff, we'll figure that out. If the demand is there, we'll get a million manufacturers if we need to. But it's how many distribution points can we build with a product? That's my first question. Amazing. What was your second question?

6:46Sorry, I forgot.

6:47Nik:Really just, okay. So, well, I think it's unique how you think about what constitutes as a good idea because of your kind of distribution first approach to even the thinking of it. So I'm curious, as you were thinking about what this next idea was that you were going to chase and build, what factors for you equate to a good business idea? What do you look for? What check marks do you want to hit? The Jolie guy said that he wants to make sure it's consumable. It fits into a routine. It ships at an economical cost. What do you look for? Yeah. Yeah. No, another great question. And, you know, I think the number one thing is in order to have a good business idea, you still have to have a good business.

7:37Right. And having a good business, it for me, that definition and answer can mean different things for different people and different entrepreneurs. But I think having a good business really means the financial validity of the business, right? The unit economics of it. So when I'm starting an idea and thinking about a business, number one, it's what are the unit economics and how can we make this profitable, right? Going from, again, coming from the water business for shipping, having liquid and using aluminum that is insanely priced, especially now with tariffs, right? It really makes you double click on those parts of the business and ensure like, hey, do we really want to go forward with this?

8:16Because these are the challenges, right? So like we can, I pretty much have a magnifying glass if I'm going to pick a product and I could see down the road, like these are the challenges and hurdles we're going to overcome because of this business idea that we were thinking about, right? So the evaluation process of moving forward with an idea is a key factor in decision making of whether I actually want to move forward. So in the Swishables case, you know, going from a super heavy aluminum bottle of water to a sachet that's super light, that factor was easily checked off right away. because once I understood economics and obviously easy to ship, manufacturing, it's not capital intensive, all green lights and all factors that made a lot of sense to me to move forward.

9:03Nik:Yeah. And then the other thing that you like to talk about is the white space, like finding the white space. Like how do you think about finding the white space or identifying the white space? Yeah. You know, finding the white space for me is like, it's not competing on the shelf. It's how do you create space on the shelf? right that's that's how i identify with the white space it's also it's not on the shelf creating space outside of the shelf is there another opportunity i'll give you an example right like with uh the swishables business or if you're in any cpg company typically you're going to start d2c and then try to go to retail or if you have retail experience you can go to retail and try to get stores right uh but those are realistically only two channels right but most people because that's the way it's been done it follows the status quo it's like those are the only two channels i'm going to focus on um but for the way i look at it is like those are more red ocean right versus blue ocean strategies are like you are creating channels where there's way less competition which gives you a higher probability to succeed right um what's an example of that.

10:16I can give you golf courses or restaurants where they offer mint at the checkout or in the bathroom. We're now reimagining what a mint looks like and having a mouthwash there. That to me is like a blue ocean strategy. Sure, it might not net you the same amount of revenue as Target, but it's that type of thinking that allows you to unlock scale and distribution and build brand moat, right? That most, I feel most founders don't really think about, like I said, they're either focusing on D2C or focusing on retail. And it's not bad to focus on those two. That's not what I'm saying. I think what I'm saying is that it's, there's, it goes back to the scale question, but also like where else just be curious, be so curious to understand where your brand can fit right and make space make space like reimagine the space is kind of and that again is just it's about being uber curious and when you say that like you're talking about all of these

11:18Nik:in all the fun spots that you can place swishables like airlines clubs wherever right yeah like kind Kind of just how can your product fit in? Golf courses, right? Just this, I could list, I could rattle off like 20, but I would be giving you our playbook. So we're not going to do that. But yeah, but there's a lot. There's a lot. And like, I feel like the perception for a lot of these places though, is that it's very like pay to play. Like I remember when I worked at Hint, you know, Pandora always was trying to get Hint in the fridges there. And they were like, oh, but you got to pay off the distributor, you know.

11:55Nik:and then getting their good graces and then they'll maybe start slipping you into the into the fridge is that is that how it works or is that just how like is that just one way to do it no i mean it's definitely one way to do it and look like i've had so much experience with that not just pay to play but even with the pay to play option there was so much red tape because when you're selling bottled water and you're going up against coke and pepsi and you're trying to win an arena or a stadium and you just don't have the amount of resources and you can't compete from a marketing dollar per dollar perspective, where that really matters on the beverage side, right?

12:29Like that's what really matters. If you want to become a big brand, like on the beverage side, such in the water category and penetrate some of those channels, then it is pay to play only as the option. For this category, again, another key factor in going into decision-making before, hey, do we want to click the button, hit forward on this? It's not. Pay-to-play is not an option here, which is amazing. And the reason why is because the pricing to the customer or the wholesaler is just not what a beverage is, right? So there's no pay-to-play option here. Although we are creating that. We are creating that pay-to-play option for this category because it hasn't existed yet.

13:15But what that triggers to me is that it just shows you the lack of innovation in this category, right? Because I've already gotten asked twice from two huge, large clients in our pipeline for a pay-to-play model because it doesn't exist with the current solution that they have now because it's a generic mouthwash. But now we're coming in as like a mainstream brand that we're building. And now I'm being asked that. but the funny thing is it's never existed in this category so I think that will change because of brands like ours but the typical model is not pay to play for an HBC product like this

13:55Nik:Are you concerned that as soon as Swishables really attacks the retail floors you're going to see a bunch of copycats start to pop up? I wouldn't say concerned I think in the water business we started and there was two aluminum brands And when we left, there was 20, right? So that's inevitable. The more important thing you should be concerned about and focusing your time on is how do you build brand moat? Because there will be copycats. That's inevitable, right? That just means your product is good, right? Imitation is the biggest form of flattery. So the product is good. People are going to copy.

14:35But you can't focus your time and energy on that. It's about building brand moat and talking about those alternative channels that I was talking about, right? Like that's where you should be spending your time and energy on. It's hard to, you know, build like IP around something like this, but like scaling quickly, building brand moat, getting diverse distribution, having the right team involved is really what separates you from the copycats, right? I mean, you know this, like you can have the same product with two different teams and you have five people on each team. One team with the five people has done it before.

15:13The other team, maybe it's their first time or they've sold in a different category or whatever. You're going to have two very different results, right? So it's all the nuances of building the brand, like team, channel, all the things I mentioned that's really going to separate you. And that's what you need to spend your time on.

15:31Nik:Yeah. Um, what about like getting into retail? So like these alternative channels we just talked about, but like when it comes to retail, um, you know, do you think it's start, it's smart to start in retail? Like, how do you think about driving sell through, you know, for direct consumer brands, they're always thinking, well, we can't go to retail until we feel confident we can sell what's on the shelf. But, um, you know, I feel like more and more brands are now starting in retail and sort of building e-commerce as like it exists, but it's not where they're starting. yeah no it's a really good question and honestly i don't think there's a right or wrong answer i think if you and it also depends if it's your first business and who you have around the you know around the table with you on your team if it's your first business or second business all these factors matter um i personally think it's funny that you say that because i feel it's actually the opposite i feel like more like brains are still going d to c uh first because when you go to a retailer unless you have relationships or know actually how to get into the retailers fortunately we do because it's our second time we've done it but it's not easy either way is not easy um retailers accepting you without any data is tricky right like if you go to them and you're not selling online and you're like hey i have this cool idea do you want to slot me in well that's not really how it works you might get a couple too if it's your first time um so i actually do think that the ddc model first is a little bit more strategic um and then going to a retailer or a specific region and having targets there right it's more like that inch wide mile deep approach right like the one thing that i think that's interesting is like especially the um the co-creator economy when they you know you have an influencer behind the brand and the first account that they go to is walmart the largest retailer in the world that's great but i think what they fail to realize is like you are setting your price floor for all the other retailers there totally right they're the lowest you get into walmart then you're gonna have like a stop and shop wherever you are in the country whatever grocery you go to is like hey what's your pricing walmart i need to be within 15 of that and that's something they don't really think about they're just thinking at like the big shiny object, like, and the post of, Oh, Hey, I'm in Walmart 4 ,000 stores.

17:58So I really think that that needs to be like double clicked on and like understanding what you're actually doing for the longterm. So that's another reason why I wouldn't go into retail first. I would go into DDC first, understand the data, use the data to tell you like where you're winning and where you're not, what you can improve on. And then I would go to retail because it's just two different beasts. You know what I mean? It's two different pieces. It's two different unit economic models. It's two different resources that you're going to need to build out each. So that's why I say like focus is definitely important for us.

18:35It's a little different because me and my other co-founder, like we managed two different, very separate divisions of, of the business before. And that's kind of, we're utilizing our relationship experience to do that. And for e-com, I'm bringing in amazing gangsters like you and some other people to really help support on the D2C side. So yeah, I think I would personally start D2C first if it was my first brand and I was starting new. But also get the right people around you and then go to retail.

19:06Nik:Brands like Third Love, Liquid IV, and NeuroGum all swear by instant. They've tripled their email revenue and some like Karen Cain even see a 5x increase. Why? Because AI can build hundreds of versions you'll never have time to make. While you're running your brand, Instant is running the experiments, figuring out what works, and then continuously optimizing to keep conversions growing. BFCM's over, and your next growth run starts now. Grab a demo by December 31st and get 50 % off your first 60 days at instant.one slash Sharma. And how do you think about marketing for retail? like what were some of the more successful marketing initiatives you've seen work well for retail yeah i mean you know it's there's so many things i could say here but i think i'll give you kind of a peek into how we how everything we do in the business should relate to building velocity off shelf at retail right so like with swishables in our previous business we looked at, we sold in retail and food service.

20:13Food service, meaning like hotels, airports, airlines, et cetera, right? Those are actually awareness and marketing channels that create flywheels for retail, right? What do I mean by that? Those are discovery channels, right? So like if somebody goes to a hotel and they discover our product and get to try it for free, and then they go home the next week and go to the grocery store, wherever they're shopping at, they're going to, number one, have tried our product and seen our product. Then there's a higher probability that if they liked it, they're going to pick it up and throw it in the cart.

20:45So it's not even just spending on coupons and doing all this stuff at the retailer. It's what are you doing outside to drive that consumer in the store and have them already be familiar with your brand. So that's one. Number two, it goes back to... Look, retailers are at the end of the day, there are real estate firms, right? Every square inch of space has a high dollar value per square foot. So like, how are you buying space or getting space at a retailer is really gonna, it's what's going to separate you, I think, in my opinion. There's so many ways, like for our product, whether you do clip strips, or you do POPs, And you're, you know, thinking like outside of just the normal shelf that your product lives on is how you should be thinking.

21:40Like just to exist on the shelf is not the game, right? The game is to get off the shelf. So in order to get off the shelf, like just you being there is not enough. So what are some creative ways that you could think to like not just be on the shelf, right? Again, I could rattle off a bunch, but I'm not going to give you our playbook. but I don't want to be a gatekeeper too.

22:04Nik:Yeah. Yeah. No. What do you think of like, you know, like Poppy, for example, they perfected the, uh, flavor plus celebrity, um, plus timely moment. Like that's kind of their strategy, right? Have you seen anything interesting like that, that you think is like, wow, that's, that's something, you know, I'm going to put it in the swipe file for later. Yeah. I mean, you know, that's a great example. So Ellen Ellensworth, right? I think she had talked about like building and investing in brand. And I think it's a hard, hard concept for founders to really understand because like, you're not going to see immediate ROI and it's hard to track, right?

22:46Just spending those dollars on community. But it is so important and they executed it so well. And honestly, I've seen that firsthand because living in Austin, obviously they're based here. You go on Congress where we met. And any weekend, there's a gang of people just handing out poppies, whether it's for a Harry Styles pop-up, right? Or this or that. So that's the investment and brand that she's talking about that relates to the retail velocity. um another brand that i think has done phenomenal um that just sold this year that i like to use an example of like how we like to think about our business a little bit is touchland right here the hand sanitizer um when you talk about brand mode and simple innovation in that old commodity category, like hand sanitizers, I think they've just done an incredible job in building brand community and really just like a cult following with an insane demo, which is teenage girls around the country.

23:54It's so powerful. It's so powerful.

23:56Nik:Yeah, no, it is super interesting. Touchland too. Like I remember as soon as they came out, you're right. It was like a cult-like adoption of the product and those people are still using Touchland today. yeah i use it and you know it's like it's meant for it's really i feel like it's skewed towards female but i mean i use this right like it stays in my backpack um because i don't like using the boring purel gel bottles that leak and you have to squeeze and it looks medical right so like i always like to relate our product to that because like we're taking the tiny 3.2 ounce crest or scope bottles and then we're reimagining what that looks like and having a more premium feeling for consumers and making it more portable, convenient, and sexy and better for you.

24:39Nik:Right. Yeah, I love that. Can you explain how brands get into retail? Do you have to sell to distributors or do you have to go sell to retailers? And same goes for local accounts, like bodegas around New York, for example. How does all that work? Because I know there are brokers that exist, right? And what do brokers do? They basically just promise you you're going to get a meeting or they push the deal across the finish line. Can you just break this down? Getting into retailers is, it's pretty simple, but it's not. No, but realistically, it's really simple, right? Like the retailer has a buyer, the buyer has a certain review period and your job is to get a meeting with that buyer and get your samples on their desk so they can review your product during the review window, which is really like once a quarter out of the year.

25:34How the product gets there is through the distributor. That's it. The distributor is not selling for you. They're just holding your inventory and distributing your product when the retailer buys it. Right? So the real question is how do you get to the buyers? It's a super archaic industry. And we've found that the best way to get to these retailers with our previous business and this business is using brokers. Now there's large national brokers. There's more boutique brokers. That depends on your strategy, right? Like where do you want to go? Who do you want to use? What's your budget? All that stuff obviously matters.

26:17But brokers is probably going to be your best bet. How does that work? You pay a simple retainer, You might play retainer plus little commission. You can work out a deal if you work out a deal, however you want. But the broker's job is to get you a meeting with the retail buyer. Now, prepare you and get you the meeting. Obviously, if you know what you're talking about, know how to run promos and know what the retail buyer wants to hear, which is how are you going to move this product off my shelf? That's the only thing they care about. because if they pick your brand and you didn't sell, that retail buyer has a target to hit, right?

26:56It's their responsibility to hit their category's target. And if they don't do that because you're a brand underperform, well, guess what? You're going to be off the shelf probably in 12 months. So use a broker to get you the meetings. But again, that's just the first step, right? Getting on the shelf.

27:16Nik:And in those meetings, is the value from the broker, Or is it getting the actual meeting? Or is it like being in the meeting and kind of being the adult in the room that the buyer is like, all right, these guys know what they're talking about. They're going to run promos. They're going to buy in retail media. And they know how to speak to all that. Yeah. I mean, look, relationships help, right? Like I've had some meetings where our broker just has an amazing relationship with the buyers. And they've worked together for 15 years. And if the broker is like, you need to bring this in. And here's how they're going to run their programs and promos.

27:47and this is what they're going to do to support you. Obviously, it makes the conversation so easy, right? It makes the conversation so much easier.