Channel Pricing Tools for Profitable CPG Brand Growth
Reset how your team thinks about margins, pricing, velocity, distribution, promotions and cost of sales.
What is driving your 2024 CPG brand growth?
Is it going to look like this?
….Or this?
It is going to be increasingly difficult to achieve a significant price increase in 2024 and 2025.
So, what are the implications for your brand profitability in either of the Brand A or Brand B scenarios above?
Does you team know? Do you have a viable and pragmatic plan for 2024 and 2025?
How should you price when entering new channels or route-to-market retail accounts?
Overcoming failure risks
Minimize the risk of CPG brand/SKU growth failure or new account rejection by utilizing tools that help you build pricing and growth plans that are based on:
A sound analyses of price-points, margins and bottom-up unit economics.
Realistic and rational velocity and distribution expansion plans.
Sales growth trajectories that can support sustainable and fundable profit growth.
Various growth and profitability scenarios can be simulated with the suite of Margin Velocity Planner ™ tools. This capability allows you to frame and discuss pragmatic and credible trade-off options with your team, retailers, distributors and investors.
Improve your channel pricing and profitability prospects by enlisting for a 4-to-6 month capability building program. For marketing, sales and finance teams.
Three Core Margin Velocity Planner™ Tools:
Tool #1
Route-to-Market Pricing and Profitability Analyses
Set Suggested Retail Prices (SRPs), Temporary Price Reductions (TPRs) and Free-on-Board Prices (FOBs) for direct store delivery (DSD) and direct-to-retailer accounts. Evaluate profitability impacts and trade-offs.
Tool #2
36-Month Account Growth and Profitability Outlook
Compile and stress-test a 36-month pricing, velocity, key account and sales contribution growth plan for a brand/SKU family that takes into account seasonal fluctuations.
Tool #3
36-Month Net Profit, Cash Flow and Funding Outlook
Compile and stress-test a 36-month net profit, capital expense, cash flow estimate and debt/equity outlook for an aggregate set of brands/SKUs.
Margin Velocity Planner ™ (MVP) pricing and margin tools help you build viable route-to-market growth plans for your CPG brand.
Set Revenue Growth Pathways
Chart the viable Net Revenue growth trajectory that is needed to scale.
Set realistic, achievable velocity-based growth targets.
Build a pragmatic velocity -based distribution and account growth plan.
Establish the Unit Economics
Estimate various trade marketing and direct selling expense categories.
Build the Unit Economics for any price-point using a bottom-up approach.
Measure Gross Margin & Sales Contribution metrics and percentages correctly.
Analyze Price Points at Retail
Establish the wholesale case price and margin impact for different price-points..
Use the Pricing Matrix to negotiate with distributors and retailers.
Highlight the impact of distributor and retailer margins on the brand’s viability.
Estimate Trade Marketing Expenses
Build an appropriate Trade Marketing Expense mix for the brand.
Compare the impact of different Trade Marketing expense strategies.
Discuss the level of support with distributors and retailers.
Determine Viable COGS Ranges
Determine the COGS or range of COGS needed to achieve your target Gross Margin.
Analyze the impact of COGS on the Unit Economics of the brand.
Estimate competitor pricing and margin economics.
Build a Multi-year Financial plan
Project a 36-month financial forecast to estimate growth and investment potential.
Determine EBITDA breakeven volumes and time frames.
Plan debt and equity financing timing by estimating working capital and cashflow needs.
Book an Exploratory Discussion
Book a 30 min complimentary discussion, with Manoli, to explore how the Margin Velocity Planner ™ tools and approaches can help your emerging CPG brand and teams build credible velocity -based growth and financial route-to-market plans for your brand.
80% of Premium CPG Brands fail to scale beyond $500,000 annual trailing Net Revenue.*
Emerging CPG Brands that do succeed follow a skate-ramp* trajectory. They embrace a deliberate intent and single-minded focus that is centered on a velocity -based distribution expansion approach.
*Dr. James Richardson, Ramping Your Brand: How to Ride the Killer CPG Growth Curve . PGS Press.
