It’s not an easy task to manage the operations of a CPG business. Profits can be an overwhelming task when you’re managing production costs and relationships with distributors and marketing campaigns. What if we told you that your bottom line was not in danger due to rising costs of materials or tough competition but rather the deductions which gradually decrease your income.
It’s not the hottest aspect of running the CPG brand however, it is one of the most crucial. If a retailer is unable to pay its account because of chargebacks (or other issues) promotions, or other vague compliance issues, it could take a bite out of your profits. If your cash flow is already strained, this deduction could be the difference between a successful and failure.
Deficit management that is not properly managed can cost significantly more than you realize.
Let’s face it: nobody is launching a CPG to argue over deductions. But, as business owners soon realize, these deductions add up quickly.
Without proper deduction management, you’re left guessing why certain payments don’t match invoices, struggling to dispute unfair chargebacks, and constantly feeling like your business is bleeding money. It’s a hassle, it’s time-consuming and most importantly, it distracts your attention from the most important thing to build your business’s reputation.
This is made more difficult by the lack in transparency. It’s sometimes difficult to determine which deductions are correct because many deductions are made without explanation. A lot of companies aren’t aware of how much they’re losing until they have a look at their accounts. In the end they could have lost hundreds of thousands (or million).
Deduction Management Software A Game-Changing Solution
The good news is that You don’t have to handle this problem manually. Software for deductions can take away the guesswork, by tracking their progress, analysing and resolving the issues automatically.
Instead of getting lost in spreadsheets, managers can clearly see where money is allocated and where deductions are made. Even better, modern software solutions allow brands to dispute incorrect claims faster while also recovering the revenue lost more effectively.
Automation can also result in lesser human errors and more accurate financial reporting. This type of transparency can be incredibly valuable in the management of an CPG company. It provides you with the confidence needed to expand, invest in and work with retail partners.
Food & Beverage consultants are crucial to the success of your company
Although software is an effective tool, it’s sometimes helpful to have a professional at your disposal. That’s where a beverage consultant can help.
Experts who have experience in food industry consulting can help CPG brands implement smarter deduction management strategies, educate teams on best practices, and negotiate more favorable deals with distributors. They know the business inside out and can offer information that could otherwise take years to uncover.
Professional guidance for businesses that are growing can mean the difference in endless debates over deductions and a process that’s efficient and helps save money.
Final Thoughts
It’s not just about locating lost funds and ensuring the financial health of your business. Whatever the method, whether it’s using deduction management software or an expert food and beverage expert, taking charge of your deductions is being in control of the flow of cash, your growth, and even your future.
Don’t let deductions deprive you of your earnings. Instead, get in control and transform what was once thought to be a source of stress into a better growth for your business. Your bottom line will appreciate it.