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Inflation Station: How To Manage Increasing COGS And Inflation
In many ways, the last two years have been great for the growth of CPG brands, more people were cooking at home and CPG discovery was on the rise. But, on the flip side, supply chain challenges, labor issues, and a laundry list of other logistic challenges hit CPG brands, especially the smaller ones, hard. If you are dealing with the challenges of ever increasing cost of goods (COGS) and inflation, you're not alone.
While now is a great time to increase your prices, while consumers are more understanding, it might not be possible to fully offset the inflationary pressures, here are a few things to keep in mind and consider as inflation continues to rise and other COGS for your business.
Know Your Numbers
The first step, always, is to know your numbers. Collect data and go to your books and take a close look at your profit and loss. This will help you see how inflation is impacting your bottom-line (or if you are somehow unscathed).
Look at Your Options
A price hike isn’t the only way to increase your profit. Are there expenses you can reduce? Can you find a less expensive packaging supplier? What about your ingredients? Quality of course should always be a priority but knowing your options and understanding what else is out there can help you feel confident in your decisions and maybe even offer some alternatives you didn’t consider.
To Automate or Not to Automate
At WeStock we’re a big fan of providing jobs to our communities and human talent. But, more and more companies are looking at ways to automate their processes. While automation can be an expensive up-front cost from machinery or software, in some cases it can end up saving you money (labor costs) and time in the long run.
Communicate Early & Often
If after looking at your numbers you find that a price increase is the best course of action, the most important thing you can do is be transparent. We have a whole article on this with all the steps to make it successful.
Consult a Professional
Sometimes you need a professional. Whether that’s a financial advisor, an auditor, or a CPG consultant, bringing in an expert could be a great way to make sure you aren’t missing anything and expand your perspective beyond your experience. We recommend Sarah Delevan who we did a webinar with last year, which you can watch HERE.
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Inflation Station: How To Manage Increasing COGS And Inflation
In many ways, the last two years have been great for the growth of CPG brands, more people were cooking at home and CPG discovery was on the rise. But, on the flip side, supply chain challenges, labor issues, and a laundry list of other logistic challenges hit CPG brands, especially the smaller ones, hard. If you are dealing with the challenges of ever increasing cost of goods (COGS) and inflation, you're not alone.
While now is a great time to increase your prices, while consumers are more understanding, it might not be possible to fully offset the inflationary pressures, here are a few things to keep in mind and consider as inflation continues to rise and other COGS for your business.
Know Your Numbers
The first step, always, is to know your numbers. Collect data and go to your books and take a close look at your profit and loss. This will help you see how inflation is impacting your bottom-line (or if you are somehow unscathed).
Look at Your Options
A price hike isn’t the only way to increase your profit. Are there expenses you can reduce? Can you find a less expensive packaging supplier? What about your ingredients? Quality of course should always be a priority but knowing your options and understanding what else is out there can help you feel confident in your decisions and maybe even offer some alternatives you didn’t consider.
To Automate or Not to Automate
At WeStock we’re a big fan of providing jobs to our communities and human talent. But, more and more companies are looking at ways to automate their processes. While automation can be an expensive up-front cost from machinery or software, in some cases it can end up saving you money (labor costs) and time in the long run.
Communicate Early & Often
If after looking at your numbers you find that a price increase is the best course of action, the most important thing you can do is be transparent. We have a whole article on this with all the steps to make it successful.
Consult a Professional
Sometimes you need a professional. Whether that’s a financial advisor, an auditor, or a CPG consultant, bringing in an expert could be a great way to make sure you aren’t missing anything and expand your perspective beyond your experience. We recommend Sarah Delevan who we did a webinar with last year, which you can watch HERE.
What You’ll Learn:
Inflation Station: How To Manage Increasing COGS And Inflation
In many ways, the last two years have been great for the growth of CPG brands, more people were cooking at home and CPG discovery was on the rise. But, on the flip side, supply chain challenges, labor issues, and a laundry list of other logistic challenges hit CPG brands, especially the smaller ones, hard. If you are dealing with the challenges of ever increasing cost of goods (COGS) and inflation, you're not alone.
While now is a great time to increase your prices, while consumers are more understanding, it might not be possible to fully offset the inflationary pressures, here are a few things to keep in mind and consider as inflation continues to rise and other COGS for your business.
Know Your Numbers
The first step, always, is to know your numbers. Collect data and go to your books and take a close look at your profit and loss. This will help you see how inflation is impacting your bottom-line (or if you are somehow unscathed).
Look at Your Options
A price hike isn’t the only way to increase your profit. Are there expenses you can reduce? Can you find a less expensive packaging supplier? What about your ingredients? Quality of course should always be a priority but knowing your options and understanding what else is out there can help you feel confident in your decisions and maybe even offer some alternatives you didn’t consider.
To Automate or Not to Automate
At WeStock we’re a big fan of providing jobs to our communities and human talent. But, more and more companies are looking at ways to automate their processes. While automation can be an expensive up-front cost from machinery or software, in some cases it can end up saving you money (labor costs) and time in the long run.
Communicate Early & Often
If after looking at your numbers you find that a price increase is the best course of action, the most important thing you can do is be transparent. We have a whole article on this with all the steps to make it successful.
Consult a Professional
Sometimes you need a professional. Whether that’s a financial advisor, an auditor, or a CPG consultant, bringing in an expert could be a great way to make sure you aren’t missing anything and expand your perspective beyond your experience. We recommend Sarah Delevan who we did a webinar with last year, which you can watch HERE.
What You’ll Learn:
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