Survival tips to:
make it through the winter and come out on top.
Bundle up! Winter is Coming for CPG Start-Ups, but it doesn’t have to be that cold. Survival tips to make it through the winter and come out on top.
After a career in media strategy, working on brands like the Dove Campaign for Real Beauty, LiptonTea, Baileys, Suave, and Hellman’s, Laurel co-launched Daily Crunch Snacks in 2020. Daily Crunch is a women-owned, mission-driven, and sustainably sourced company that makes uniquely crunchy sprouted nut snacks that taste as good as they make you feel. We satisfy crunch cravings with a superfood-infused, sprouted nut and trail nut mix without added sugars, preservatives, or additives and minimal to no oil. You can now find Daily Crunch Snacks in 5,000+ stores across the country. Follow our journey at @DailyCrunch_Snacks or visit DailyCrunchSnacks.com.
Before the New Year, a close CPG friend confided in me that she ran out of cash and couldn’t find investors to back her brand and was, therefore, either closing or selling her business. While this was heartbreaking to hear, I didn’t initially want to listen to the news circling all around me that economists were predicting 2023 to be a tough year for everyone. Well, now that it’s 2023, the situation seems much direr than they initially predicted a few months ago. Some say the economic downturn could be 6-18 months….yikes! Just like during covid, founders must re-strategize and pivot their marketing efforts to survive the economic turndown while not running out of cash in the interim. If you haven’t started thinking about how to re-strategize, it’s time to start now (aka yesterday!).
Before I joined ‘the other side’ to become an entrepreneur, I was in the corporate CPG world, working on brands like Bailys, Lipton, Hellmann’s, and Hasbro. When I worked on the Unilever business, we regularly made changes to brace a slowing economy. We cut advertising budgets, pushed back launches, and focused on our core brands. The only difference now is that we don’t have the luxury of working at a Fortune 500 company to back us when times get tough. Startup CPG brands have limited resources but can survive and come out on top. Daily Crunch Snacks launched in March 2020 when covid took a turn for the worse. We had to completely re-strategize our launch when potential retailers told us that if we weren’t milk or toilet paper, we would not bother reaching out for a LONG time. Well, we re-strategized and forced ourselves to think out of the box. So much so that Daily Crunch Snacks is now a Harvard Business Review case study on launching a startup at the start of a global pandemic.
If growth was your focus last year, you might need to pivot to eliminate your burn and make drastic changes. This is OK, and this is normal. You just need to get through the next 6-18 months until the pendulum swings to the other side. Below are some tips to brace for impact and make it through the next few months:
- Cut your Burn NOW. Go through a financial cuts exercise of what’s ‘nice to have’ and what’s a ‘must have’ and start making cuts. If P&G and Unilever can do it, so can you.
- Saying NO to new retailers! It’s OK to say NO to new retailers right now. Launching into a large chain can require 6 figure promotional support in year 1, not to mention slotting fees. Instead of focusing on growth from new retailers, focus on your core retailers that you are already in and getting velocity up.
- Ensure you have In-store shopper marketing, sampling, promos, geo-targeting, and influencer partnerships locked in for Q1. If you aren’t tracking velocity in key retailers, start now. We recently partnered with Promomash to help us manage promotions, track our velocity, and more. Also, Aisle is a great way for consumers to discover you in-store.
- Join a CPG Group. I’m in a Women-Owned CPG and YPO group that meets monthly. Everything we discuss is confidential, and the support I get from both groups is priceless. Start a monthly group with 6-8 founders this winter; you will thank me later!
- Monthly Newsletters. Investors aren’t sure they want to invest right now? Stay top of mind with monthly newsletters to share key highlights and updates on your brand. You don’t need to go deep, but rather keep it light and stay top of mind for when they are ready to make an investment. Remember, the squeaky wheel gets what they want! A great resource to write investment updates is through Paperstreet, but a Word document is good, too (just remember to convert to PDF!)
- Do Your Own PR. You don’t need to spend 5,000/month for a PR agency. Carve out 30 minutes weekly to write to your top 5 media outlets. Write an email to the editor and include your WHAT, WHY, WHEN, and WHO. Write out the story for them and make it easy for them to take your bullets to include in a write-up. Don’t forget about industry outlets, too, like Startup CPG, Foodboro, Nosh, Snackfood & Bakery, etc, to share new news. Find out when all of the award submissions and make sure to apply! Remember, if you don’t apply, you will never know if you would’ve won!
Finally, use this time to be authentic to yourself and your brand. I was lucky to work on the Dove Campaign for Real Beauty when they catapulted into being one of the most impactful ad campaigns to date. They focused on their mission and pushed the needle to fight the toxic beauty standards. You don’t need to spend a ton of money to talk about your mission, value, and story to your consumers. Consumers are more likely to purchase a brand when they know the people behind it and can talk about your story. Good luck, and stay warm; you got this!
Co-Founder and CEO of Daily Crunch Snacks