cpg business

Making the decision to scale your CPG company is not just about crunching the numbers; it’s also about the people. Competent and committed employees are any business owner’s biggest asset, offering flexibility and creativity even in the face of rapid change. In fact, your core team can even drive down costs without jeopardizing sustainable growth. For example, a 2012 McKinsey & Company report found that only about 50% of the interactions involved in making critical decisions at large CPG companies were perceived to truly add value. Carefully attracting and retaining the right employees reduces those kinds of inefficiencies and makes growing pains a little more manageable in three key ways.

Improved Employee Management

When scaling your CPG business, you will inevitably have to hire new personnel in order to take on greater volumes of production, increased sales, and broader marketing efforts. As you add these new members to your team, it’s imperative that they be trained quickly and properly. Your core team can help shoulder some of this burden, acting as mentors and assisting with onboarding.

As distribution grows and your product begins to appear in multiple different locations, managing a remote team can be an especially difficult adjustment. Solutions like team communication software make effectively training, managing and monitoring these employees easier, even from a distance. Mobile CRM gives your team the tools they need to be successful, such as maps, schedule management, customer details, and forms while giving you the ability to drive accountability and analyze data from your office.

Over time, promising employees should be given more responsibility in order to develop their leadership skills and prime them to move into management roles. Growing a CPG company requires significant personal sacrifice, but the burden is lessened when duties are delegated. “Until your new management team can fully run things for you,” says Troy Hazard, author of Future-Proofing Your Business, “you are the one who has to do double time between the existing part of your business and the new, so you have to be prepared for the sacrifices that will take.” Hiring trustworthy employees with potential for growth will allow you to assign tasks successfully, minimize mistakes, and retain some work-life balance.

Healthy Company Culture

Many executives don’t take the time to flesh out a detailed vision for their company culture during the stages of early growth, but once you’ve made the decision to scale, culture begins to matter. It acts as a framework for all decision making and will help keep your business on track during periods of rapid change.

Employees play a key role in shaping company culture, so it’s crucial to hire people at the outset who believe in your business’s mission and espouse its values. Okta’s Todd McKinnon told Forbes magazine that “culture is shaped mostly by how your leaders act, so make sure that your leadership team embodies the type of company you want to be.” In addition, the enthusiasm of veteran employees has a trickle down effect, inspiring and incentivizing new team members to work harder.

However, building good company culture takes time and consistent effort. Create an organizational structure that fits your business’s overall strategy. Communicate your culture repeatedly and clearly. Reward those employees who embody your culture and start a conversation with those who don’t. Synergy between the kind of people you hire and the culture you create is imperative for successful growth, and the right employees will embody that culture in everything they do.

High Returns on Investment

Intelligent and dependable team members are the best investment you can make in your business, especially if you take the time to help each employee reach his or her potential. Encourage employees to grow alongside the business by attending seminars, joining industry-specific organizations or taking online training courses at no additional cost. According to David Hassel of 15Five, contributing to employee success results in improved morale, increased retention and a better business reputation, all of which are important for successfully scaling your CPG business.

In addition, opening up different channels of communication between managers and employees as well as within individual teams can multiply the benefits of your investment exponentially. Some good ways to share information and boost employee engagement are through a company-wide newsletter or more informally through various social media platforms. A more knowledgeable and motivated team leads to higher quality work, increasing your company’s bottom line.

Investing in your team doesn’t only create productivity and quality-of-work benefits; it also equips your employees to act as well-informed and enthusiastic ambassadors for your business. According to Ernst & Young, one way to catalyze your company’s growth is “by building and fostering critical relationships.” Simply put, your employees are already part of a wide network of personal and professional contacts. If they are excited about your business, they will both intentionally and inadvertently share that enthusiasm with potential customers. Especially in the CPG industry, your brand’s success is entirely dependent on its reputation among consumers and retailers. If you’ve invested time and resources in your employees, you can be confident that they will represent your company in the best possible light.

The decision to scale your business is one that should be made with careful reflection and ample research. Adding up the dollars and cents is an important step, but so is building the right team. “Without great leaders and then the right people in place, even the greatest idea is going to struggle,” Bob Davis of Highland Capital Partners told Entrepreneur. “But with an amazing team, mediocrity can turn into something special.” Besides, success is always sweeter with the right people by your side.