Day 24’708

Premature distribution expansion is probably the most common and "difficult-not-to-make" startup mistake in CPG.

In this context, brokers' and distributors' incentives are not aligned with those of the startup. As James Richardson explains in "Ramping Your Brand": "Since it will often take more than six months to figure out what is going on, brokers and distributors will have monetized your business just fine, even if you get delisted eventually.”

This is also one to watch out for within the context of The Sprezzatura Company roll-up. Sometimes, other forms of value creation than expansion should be prioritized, and/or expansion must be done cautiously and slowly, closely monitoring the key metric: development of same-store sales per SKU per week.
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