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An Inflation Survival Guide for Consumer Brands

Updated: May 10, 2022

Actionable Steps for Thriving in a High Inflation Environment.

“Inflation is like alcoholism. The good effects come first.”

-Milton Freidman

Liberal or Conservative, Democrat or Republican; it’s gotten pretty hard to deny the fact that we have entered an Era of relative Inflation.

But inflation or not, there’s one thing that hasn’t changed: You need to win.

Someone always wins.

“Inflation steals from the ignorant, and gives to the well informed.”

-The Power of Money Dynamics

Forget inflation for a moment. Let’s start with a reminder that business happens in a competitive environment. We’re all competing to capture the hearts of our target customers. That’s what the winner’s circle looks like for physical brands.

And in that context, there is one thing that every era and environment have in common: They all have winners and losers.

Recessions and Booms, Wars and Peacetime, Bull Markets and Bear Markets; they’re all the same in this regard. Some businesses fail, some trudge on in mediocrity, and a few come out on top.

And while we are not rooting for the financial ruin of any person or business at all, knowing that only a relative few will really win, we want and need you to be among them.

Enter Inflation.

In light of this competitive selling environment, we just happen to have shifted to an era of high inflation.

It’s not about predictions or outlook anymore. Inflation is here, and it’s here for the foreseeable future.

We see it in the rising costs of freight, energy, raw ingredients, and basic commodities. And before we can adjust to the last round of price hikes, prices are already rising again.

But, enough of the negativity already. The truth is that many companies absolutely thrive during periods of high inflation.

Warren Buffett famously uses periods like these to enrich his shareholders through strategic acquisitions. Some of Buffett’s companies, like See’s Candy specifically, actually increase profits during periods of inflation.

And if there are always winners, that means that your brand to be one of them.

Here’s How You Are Going to Win.

Fortunately, as Dad might have said, “This ain’t our first rodeo.” We’ve been through periods of high inflation before. Yes, right here in America. In fact, it’s been a lot worse than it is right now.

The US hit a YOY Inflation Rate of 18% in 1946. We hit 13.3% and 12.9% in 1979 and 1980 respectively.

The bottom line is that we have case studies and multiple periods of winners and losers to analyze and learn from.

In light of our collective National experience, we’ve done a little homework for you, and we’ve come up with 4 very actionable steps you can take to come out on top.

  1. Raise. Your. Prices. (aka, don’t be an Inflation Hero.)

Yes, you might be pretty slick, but don’t try to be the John Wayne of Inflation. There is an entire Supply Chain raising prices, and you can’t be the one layer absorbing all of the rising costs.

There are always a lot of players in any brand’s supply chain. There are commodities harvesters, freight haulers, manufacturers and factories, packaging suppliers, retailers, distributors, service providers, and of course, Your Amazing Brand.

But throughout your supply chain, do you know who is going to pass on rising costs to you without batting an eye? Everyone.

But for obvious reasons, brand owners are the ones that usually feel the highest loyalty to the customer. You’re the one that worries about how rising costs will impact your sales conversion, and you worry about how retailers will react to higher pricing. And so most often, you’re the last part of the supply chain to avoid passing down costs.

Psst. Want to know a secret? Come a little closer. Closer. A little more…

***While the Big CPG Brands are the MOST able to handle rising costs, they’re also the FIRST to pass them on to consumers.***

We’ve noticed that the biggest brands, those that have been around the longest, are the first to raise their prices once component costs rise. They have been around the block. They know the game.

Conversely, the smaller the brand, the longer they end up holding the bag for rising costs. Even though they’re precisely the ones that can’t afford it.

It is small and medium size brands that resist price increases until they find themselves in a bad place. They simply are used to fighting against rising costs in any environment, so that’s what they continue to do during times of Inflation.

Here is how the best companies raise their prices:

  • They know and understand their degree of price elasticity.

  • They know their customer and their customers’ budgets.

  • They communicate effectively with their customers.

So please remember that regardless of inflation, Product Pricing must be a function of Unit Economics. Period. That’s how we stay in business.

So cut costs as aggressively as you can, and when you can’t, RAISE YOUR PRICES.

2.) Automate EVERYTHING. …or at least everything you can.

There are costs right now that you just can’t control, so lower the ones you can.

Over the last year, we’ve automated everything from advertising bid adjustments, to invoicing, to inventory tracing, to pieces of inventory management. We have even automated recurring emails and various pieces of customer service.

Wait. Doesn’t automating mean eliminating the jobs of real, working people? No. At least it doesn’t have to be.

Automation can however help you to navigate labor shortages. And if you aren’t experiencing labor shortages yet, it can redirect human energy into more productive activities.

By eliminating the jobs that can be done through automation, people can be redirected to other meaningful business functions. In other words, by cutting your costs in an automated activity, you can double your output elsewhere.

Here are three ways in which you can begin automating business activities:

  1. FREE automation services. automates writing and business copy. Zapier hosts hundreds of office process automations. FormFlow streamlines and automates retail buyer engagements. The list goes on. Have a recurring task you want to automate? Google it.

  2. Hire an in-house programmer. You’ll never know how much can truly be automated until you have a programmer on hand. A single programmer can increase the productivity of your entire team exponentially within a year.

  3. Bring in a project based automation specialist. (Yes, these exist.) They can automate everything from data organization to reporting to pretty much any repetitive task. Invest in them once, and they can fundamentally change your business.

Automating tasks frees up people to do the things that matter, which can boost the productivity of your entire business.

3.) Get Lean. Do it now.

If costs are going to rise, businesses are best served by figuring out how to do more with less. If you’ve never had to start leveraging Lean business principles, the time is now.

The key here is to produce more output without increasing labor, resource, material, or energy inputs.

This doesn’t require you to halt all strategic spending. It does however require your company to differentiate between strategic spending, discretionary spending, and waste.

Increasing overall efficiency, quality, and productivity in business operations – with the same resources that have been producing current outputs – can flatten the impact of rising costs.

We now have 30 years of Lean and Lean case studies to draw on. Consider two types of Lean improvements your business can make:

Analog/Traditional Lean Improvements.

  • This includes mapping, codifying, and re-working existing repetitive workflows.

  • This requires metrics to track current productivity, against that of improved processes.

  • Outsource what you are not doing cost effectively or efficiently.

  • Leverage your entire Team to evaluate and incorporate!

4th Gen/Technological Lean Improvements.

  • Almost anything repetitive can and should be automated.

  • Consider obvious software solutions such as Asana for Project Management, or Agile for CRM.

  • Consider cheap or free AI features like Gluru to automate your email activity, Magisto to automate your image editing, Hounds to serve as a virtual voice-activated assistant, etc.

  • Consider designating a single person on your team to serve as a Tech Lead to research and represent technological options at every opportunity.

Regardless of the type of improvement you’re seeking, leverage the team. Ask questions. Communicate. Measure. Test.

The sooner your business begins evaluating and improving business operations, the better positioned it is to weather storms of any kind.

But what if the current era of Inflation is just transitory? Then you’ve just next-leveled your business to excel in any environment.

4.) Shift from ‘Just in Time’ to ‘Just in Case’.

Cash Flow. We get it.

If you’ve owned a business, operated as a CEO, or served in business leadership; you’ve felt the pain of cash flow pressures. And so Just In Time (JIT) manufacturing, inventory, production, etc. has made a lot of sense. …especially in a resource rich World.

But times have changed quickly.

We won’t name them, but there are some very large companies that have been quickly placed in a very bad place by having a very narrow supply chain, and very short on-hand supply.

Consider the impact that…

…the Pandemic has had on Chinese imports, and…

…the Big Freeze ( 2021) had on the Plastics Market, and…

…the Russia-Ukraine conflict is now having on fertilizers.

The truth is that there has probably been a snowball effect between a shortage of labor, the Global Pandemic, weather related impacts around the World, and the Russia-Ukraine conflict. In a short time, we have gone from a resource-rich business environment, to an environment of increasing shortages.

Many importers that were reliant on Chinese imports went Bankrupt in 2020. The Big Freeze cut off many small CPG brands from their packaging sources. Global unrest is projected to cause significant crop shortages even here in the US.

It’s time to create both Depth, and Breadth, across our Supply Chains.

Here are some ways that ‘Just In Case’ inventory management can be implemented in your business:

  • Start exercising your secondary and tertiary suppliers. Yep. Dust off those relationships. You never know when your primaries will hit a wall.

  • Increase your on-hand inventory. Give your brand some space for when disruptions happen.

  • Start developing secondary solutions for getting your product landed. This might include secondary freight solutions, secondary packaging solutions, outsourcing solutions, etc.

And the beauty of adding depth to your on-hand supplies and inventory? Inflation drives the value up over time.

What’s Next?

An article in The Economist recently phrased it this way: “The era of predictable unpredictability is not going away”.

It isn’t just the Pandemic anymore. It isn’t just natural disasters in the US and around the World. It isn’t just a change in the Labor Market. It isn’t just Global conflict. It’s all of it.

And it isn’t like business isn’t hard enough on it’s own.

To successfully navigate major disruptions, our business will need to be flexible, efficient, agile, and smart.

So evaluate, optimize, automate, and get Lean.

Message us at to see how our Team can help your Brand win on the digital battlefield.

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