Scaling your brand & team.

TL/DR: Start with a solid foundation. It may seem like a lot of work now, but it will pay off down the road.

Scaling and commercializing a consumer packaged goods (CPG) brand isn’t just about selling more—it’s about building a strong foundation for sustainable growth. The same applies when you are building a co-manufacturing facility or running one. Many brands and co-packers struggle to expand because they focus solely on increasing sales rather than ensuring their business is structurally prepared for the challenges of scaling from day 1.

In general, I like to think about balancing three circles within a VENN Diagram: Math, Money & Risk. All three are needed to scale each aspect of your business.

Read more below to learn about some of the mistakes we made scaling our businesses so you don’t have to.

10 BASIC steps to
scaling your operations
& setting yourself
up for success
from day 1.

Creating a solid foundation from Day 1 is the key to scaling successfully. This may seem obvious and yet, we see so many brands that try to scale something that isn’t ready to be scaled yet. Do the work now and I promise it will pay dividends down the road.

I like to think about it as a simple combination of three factors: math, money & risk. First we have math, a term to summarize the audit, calculation and assessment process of your product. Second, we have money, the cash (and cash flow implications) of scaling and commercializing your product and team. Finally, we have risk. I hear these questions from brands all of the time:

• Is this WHO I should be hiring right now?

• Is that WHAT I should be selling / spending my time on?

• Is this WHERE I should be selling / marketing my product?

• Is this WHEN I should be launching this product / hiring a copacker / rebranding?

• Is this HOW I should be marketing my product?

Part of the risk circle is about assessing the supply & demand of your product to determine if the risk is worth it NOW or later. There is no reason to create more product if you don’t have any demand.

STEP 1: ASSESS YOUR PRODUCT’S SCALABILITY

Some products are scalable and others are not. Take hot sauce as an example. If you are making hot sauce with peppers from you back yard, that’s not scalable because at some point you are going to need more peppers than you can grow in your back yard to produce your product. Not only that, but if you are using peppers from your backyard, you most likely aren’t taking into account how much those peppers cost because “they are free” to you.

For co-manufacturers, if you allow for too much customization from, you minimize your ability to scale one type of product.

Charlie’s perspective: “I used fresh fruit to our shrub sodas (at Element Shrub) because that’s what I was using to create our shrub concentrate. However, that ended up being too expensive and too cumbersome from a process perspective”

STEP 2: DETERMINE YOUR COST OF GOODS SOLD (COGS) & SUPPLY CHAIN.

Similar to the above, you need to make sure that you can sell your product for more than it costs to make it. Again, I know this seems obvious and yet I can’t tell you how many times I have heard brands tell me “Don’t worry our costs will go down as we scale up”. Ideally, your cost of goods sold (COGS) are 20% of your retail price i.e. if you product sells for $10, it should cost you $2 to make it. P.S. Don’t forget to include your labor cost if you are the one making your product!

Matt’s perspective: “While your costs will go down as you scale, this comes with great cash flow needs. Not to mention, inflation. The price of eggs in 2020 was $1.51 / dozen. In 2025 is $8.15 / dozen. That’s a 439% increase over 5 years!”

STEP 3: MAKE CHANGES NOW TO SET YOURSELF UP FOR SUCCESS

It is best to work out all of the kinks in your process before you even consider working with a co-manufacturer or co-packer. If the process for creating your product is complicated, consider how you could you make that step in your process faster and easier.

Charlie’s perspective: Before we started working with a co-packer for Element Shrub, we had a bottle that was hard to source, had an expensive cork closure and 3 labels on it. Don’t get me wrong - it looked beautiful (see comparison), but it wasn’t going to scale so I switched to a bottle that was easy to find (and cheaper), a lid that was readily available and 1 label. I ended up reducing my cost of goods sold (COGS) for packaging by over 100%.

STEP 4: GET YOUR BUSINESS (AND COMPANY CULTURE) OUT OF YOUR HEAD

Whether you are operating as a solo founder or as a founding team, it is crucial to document how your business works. What does that mean? It means documenting your processes, create Standard Operation Procedures (SOPs) so that if you go on vacation or decide to leave the company for whatever reason, someone else can pick up where you or your team left off.

These SOPs will be a key tool when it comes to training new staff and communication to co-packers how to make your product according to your specifications.

When it comes to company culture, it is also important to document your non-negotiable’s NOW because if you don’t, you are going to see your values creep as you hire new employees that don’t uphold those values.

STEP 5: USE DATA TO DECIDE HOW MUCH PRODUCT TO MAKE & HOW MUCH INVENTORY TO HOLD

After your first production run, let demand dictate your supply (quantity of production). The sales process for getting in retail is longer than you think, so don’t make more product until you have a better understanding of when you’ll be on shelf.

Here is 3 reasons why you shouldn’t hold inventory or over-produce:

1. Distributors want your product to have 75% shelf life left on it when they receive it. So, if you have a product that has a 2 year shelf life, distributors will want at least 18 months on it when they receive it.

2. Storage is expensive and can add up quickly

3. The cash spent on inventory (that just sits in a warehouse) could be used for other revenue generating activities

Charlie’s perspective: We met a retailer at Fancy Food NY in June and even with positive (and prompt) feedback from the buyer and distributor, we didn’t hit the shelves until May of the following year.

STEP 6: ASSESS YOUR (TEAM’S) SKILLS, SUPERPOWERS, LIKES & DISLIKES

As brand and business owners, we can relate to doing whatever is necessary to keep the business afloat at the beginning, but in order to scale you need more people (either internally or externally) to support your growth.

The first step to figuring out who you should hire first depends a lot on what you (or your team) are capable of. It’s also important to ensure that whomever you do hire either contributes directly (i.e. they are doing sales for the company) OR indirectly (they are doing something your team is currently doing so your team can focus on sales) to revenue growth.

Again, going back to our thesis, it’s important to set this foundation in place NOW. Especially as a solo-founder, you can’t do everything forever and expect your business to grow.

STEP 7: DEFINE ROLES FOR TEAM MEMBERS (AND WRITE THEM DOWN)

Once you have completed step 6, it is time to write down your “new” role. Does this mean as soon you write this down, this is what you should start doing and not doing anything else? No, that’s probably not practical, however it does give you something to plan for.

Writing this down is important so that you know your lane, your team members know their lane AND you know what gaps you need to fill with future hires.

STEP 8: TRACK HOW YOU & YOUR TEAM MEMBERS ARE SPENDING THEIR TIME

This is something I (Charlie) recommend to every brand I have worked with no matter how long they have been in business. Most people “think” they are spending their time productively but when you actually start tracking what you spend your time doing, it can be eye-opening.

Here is the process I recommend:

• Track your time for at least 2 weeks, ideally 4 weeks. In my (Charlie) previous consulting career (before CPG) I had to track every 6 minutes of my time. I would print out an excel doc that I would fill in manually every day. There are also free services like toggl.com or tomatotimers.com. Don’t let the method get in the way doing the work - choose something that works for you.

• Analyze & categorize what you are spending time on. Categories could include marketing, sales, customer support, finance, fulfillment, etc.

• Determine the TOP 3 categories of where you (or your team members) are spending your time and then compare that to where they SHOULD be spending their time based on their superpowers and the written roles that have been assigned to them. I (Charlie) did this 4 years after starting my business and found that I was spending 70% of time either driving around making deliveries or in a commercial kitchen making my product.

Charlie’s perspective: Doing this exercise helps you prioritize what is “nice” for the business and what is “necessary”. If sales are down and you are spending 30 hours a month making deliveries (like I was) how could you change your behavior to shift at least some of those 30 hours to revenue-generating activities?

STEP 9: ALIGN STEPS 6 & 7 BASED ON HOW MUCH TIME THEY SHOULD BE SPENDING ON THEIR NEWLY DEFINED ROLES

The key to this exercise is to shift behavior. The reason we track our time in the first place is so that we can make changes and start spending time doing things that align with our superpowers, likes, and business goals and that ultimately lead to personal career growth AND growth for the business.

See image below of how this shift might look before and after tracking time.

Charlie’s perspective: As you go through this process, you will discover you are spending your time doing things you enjoy, but that don’t directly contributing to sales. That’s ok - as long as you: a) prioritize the things that the business needs first b) acknowledge that this is something you like doing and by doing it you are sacrificing / limiting the growth of the business as a result of doing it.

STEP 10: ALIGN NEW HIRE GOALS WITH REVENUE GOALS & TIME SPENT ON REVENUE GENERATING ACTIVITIES

Using the picture above as an example, you can imagine that a founder (or founding team member) was spending the majority of their time producing their product where they should have been focused on selling.

Now, there may still be a need for production assistance but that is something that the team can hire for and by doing so, it opens up more time for the founder of founding member to focus on sales.

Charlie’s perspective: This is actually what I noticed as a founder when I did this exercise. I was spending 70% of my time either making deliveries or making product in our commercial kitchen but very little time actually selling our product. I knew I had to pivot in order to grow the business so I set up a UPS account, found a co-packer and shifted my day-to-day to selling product.

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