Inside Rhode: How Operations Drive Financial Performance

When Rhode’s numbers surfaced, they told a simple story: growth built on operational discipline and smart execution, driving an exceptional 34% EBITDA margin, a top-tier performance for a young beauty brand.

1. Efficient Growth Through Brand Equity

Hailey Bieber’s influence works because she is the marketing engine. Rhode doesn’t rely on paid campaigns, her personal brand drives awareness organically. The product, aesthetic, and lifestyle are seamlessly aligned, creating credibility and reach that don’t require a massive budget. This efficiency translates directly into low marketing spend (11% of sales) and healthy EBITDA, proof that when executed properly, founder-led brands gain a real advantage.

2. Operational Excellence

Behind the brand heat sits a remarkably lean cost structure. Low product cost (product COGS: 19% of sales) and Cost of delivery (15%) signal tight supply chain control, strong supplier relationships, and disciplined management. Rhode proves that profitable growth starts with the backbone, not the billboard.

3- Lessons for Emerging Brands

Rhode’s edge isn’t just topline, it’s structure. The “boring” parts matter: supplier terms, forecasting, and COGS. Great brands become operations companies long before they become household names. Master cost control early, and you create margin and longevity.

However, brands can still thrive without celebrity reach. For those building from the ground up, the levers are clear:

• Community first: build belonging and trust.

• Product-market fit: solve a real need, not just a trend.

• Operational rigor: protect your margins from day one.

The Ordinary is proof. It reached $300M+ in five years through radical transparency, no celebrity, just credible products, fair pricing, and disciplined execution.

The same playbook applies beyond beauty. In the running world, brands like Bandit Running win through community and authenticity. When people feel part of your story, advocacy replaces ad spend.

In the end, Rhode’s P&L is a reminder that strong financials are built on strong operations. As operators, we know that profitability isn’t luck, it’s the outcome of disciplined systems, tight cost control, and operational excellence executed consistently behind the scenes.

At The Engine Room, we unpack what operational excellence really looks like behind breakout brands, because growth isn’t magic, it’s method.