The Top 3 Mistakes DTC Brands Make While Scaling From $1M to $10M

Episode Summary

In this episode of the Free to Grow CFO podcast, Jon Blair and Jeff Lowenstein discuss the common mistakes DTC brands make while scaling from one to ten million in revenue. They emphasize the importance of inventory management, the impact of marketing agency fees, and the necessity of regular financial reviews. This conversation provides valuable insights for founders looking to navigate the complexities of scaling their businesses effectively.

Key Takeaways:

-It's better to risk stocking out than to overstock.

-Monthly financial reviews are essential for tracking progress.

-Understanding contribution margin is key to evaluating agency performance.

Episode Links

Jon Blair - https://www.linkedin.com/in/jonathon-albert-blair/

Jeff Lowenstein- https://www.linkedin.com/in/freetogrow-jeff/

Free to Grow CFO - https://freetogrowcfo.com/

Meet Jeff Lowenstein

Jeff was previously leading M&A efforts at ecommerce aggregator Boosted Commerce where he was the 5th employee. He built processes across M&A, finance and operations to support rapid growth from 0 to 30 brands under management in 2.5 years.

He previously co-founded and exited an app for Shopify merchants and spent time in the Strategic Finance departments of Etsy and Caesars Entertainment. Jeff holds a BA from the University of Pennsylvania and an MBA from Harvard Business School.

He’s worked with hundreds of brands over his career and founded Free To Grow because of his passion for supporting entrepreneurs and helping them succeed. The analytical and financial tools he has developed over the years are specifically crafted for the modern consumer brand.

Timestamps

00:00 Introduction to Scaling DTC Brands

01:21 The Badlands of Scaling: Key Mistakes

02:50 Inventory Management: The Fear of Stockouts

22:07 Marketing Agency Fees: Finding the Right Fit

32:14 The Importance of Monthly Financial Reviews