This is my primary tool for analyzing direct response campaigns.  Its fairly simple, but has a lot of data that can be viewed on the same screen, along with my immediate goal metrics and long-term goal metrics.

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This is the key tool I use for determining my pricing across all channels, while keeping the retailer margins and my margins in balance.  Its a relatively easy tool, but takes time to implement correctly.  Of all the tools I use in CPG, this one I spend the most time on and is maybe the most important tool of any that I use.

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This is a question from a business acquaintance:

I’ve been approached by a network and their TV show about featuring our line in a commercial as part of an episode. The rub is that they want a $50k “scheduling fee” from us in order to do the segment. This would be a big bet for us, about 6-9 months of marketing budget and I’m trying to figure out if it’s worth entertaining. The show will air twice nationally in the same time slot and our segment would be 5-6 minutes long featuring our products and telling a story about why people should care about the ingredients in their products (and highlighting our brand as a gold standard). They also provided me with the attached deck which breaks down their viewership. Overall, I’m trying to figure out if it’s worth it (or even potentially worth it) and you’re the only person I’ve met that’s done anything like this. 

My answer:

My take is that as a small company, this kind of spend must yield measurable results in sales dollars. Branding value is hard to measure, especially when you are a small company. If you were in 30K+ retail outlets and doing 30mm a year in sales, then certainly, opportunities like this might represent great branding value. So, that said, I put on my direct marketing lens to see what kind of metrics I need to at least breakeven on my $50K spend.

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There are several posts on this website about the definition of a company vision and elements that go into developing one. A question on my mind recently is how to develop a vision for a company that is honoring to the Lord. Here’s a couple of thoughts that came to me based on scripture reading and prayer.

How do we build companies so that they are consistent with the designs of God for our lives?

In general, we humans are much more attuned to this world and its norms, customs and culture, so we end up building our businesses based on them, not on God’s designs.

For example, take the food industry. We use seed that have been genetically modified, grown on factory-farms prevalent with pesticides, transported thousands of miles, which is resource intensive, further modified and processed in plants, and packaged in material, much of which does not get recycled but ends up in landfills. This industrialized system has evolved since the 1940’s to give us most of our food that we eat today. It is largely unsustainable given the resources it consumes. Do we think this is in keeping with God’s design for how we get our food? I don’t think so.

Think of your industry. From scriptural study and prayer, what do you think is He telling you about the designs for how business is done in your industry. What is His vision for your company that is in keeping with His designs for how business should be done in your industry?

How do we adjust our business to God’s standard rather than adjusting God’s standard to our business.

I have found that if I do not stay consistent in my reading and study of scripture, I end up compromising God’s standards for how I should live my life and run my businesses and I don’t even realize it.  It is very easy to drift and allow this world to distract us from God’s standards. .

Think of your industry. From scriptural study and prayer, what would be God’s standard for how business should be done in your industry? What is His vision for your company that is in keeping with His standards for how business should be done?

What is God’s view of leadership and greatness versus the world’s view of leadership and greatness?

Think of your industry. From scriptural study and prayer, what do you think is His vision for your company is that is in keeping with His view of leadership and greatness?

I gave a 1 hour workshop at a conference on this subject.  The course outline and notes and the classroom-style video presentation are included below.

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This spreadsheet tool assists with forecasting at a much deeper level than some of the other models I have provided (here and here).  It incorporates many different elements, but the crux is using history to help determine product movement at a particular retailer, while also taking into consideration the inventory and weeks on hand available and the retailer’s historical pattern for managing inventory and weeks on hand.  The goal is to allow the vendor a better methodology for managing production and product orders from the retailer so that as little cash as possible gets tied up in producing unneeded inventory, but demand can be adequately met.

This model only works for those retailers where you can gather accurate inventory data.  It is actually rather simple to look at and sits on one sheet per SKU. It needs to be on one sheet because the user interpolates all the different data points to help arrive at a robust forecast.  However, this model is very difficult to explain.  You can easily see what is going on with the cell calculations, but it really takes time to look at it and understand how the relationships between numbers work.

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No one can help having a certain set of emotions for their business. Its not just an income, but often a significant source of enjoyment. Many businesses are an extension of the founders, owners and employees passions and interests and personal identity. Over time, our experiences with the business and the relationships we develop create baggage, both good and bad, that we then use as part of our filter for decision-making.

Most recently I’ve seen a few instances where emotions end up hurting growth. In one, the founder’s lack of understanding for how the industry works has caused them to react negatively to customers, causing them to lose business. In another, the founders have romanticized about their business being an industry disruptor. As a result, they are choosing to turn business away because the industry is not willing to work the way they want to work. I might see that if they are bigger, profitable and on a sustainable track, but they are nowhere near any of that.

So, how do we keep emotions in check, because we all bring emotions to bear in making decisions? Here’s a great tool I learned from Andy Grove’s “Only The Paranoid Survive”. Actually, I never read the book, but this tool came to me from a talk by Andy Stanley, who did read the book, and the tool really hit home for me.

Ask yourself, what would my successor do?

Here’s the methodology. If you were replaced by someone new who does not have the history in your company as you do, who does not have the relationships with all the people you work with like you do, and has not poured themselves into it like you have, what would they do in relation to the decision or situation you are in? Since they have little to no background or relationships to use to filter their decision-making, they have to go by the facts of the situation. This question tends to bring much more objectivity to the situation and the decision-making process. It has for me and it might do the same for you

Another area that this question really helps me is when it comes to rationalizing decisions. I am good at rationalizing decisions to make myself feel good about them. You might do the same. When I turn the decision around from the perspective of my successor, I end up making better decisions.

Disclosure: I have not received any compensation for writing this post. I have no material connection to brands, products or services that I have mentioned. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255.