It’s not an easy task to manage it as a CPG company. Between managing the cost of production along with distributor relationships and marketing strategies, keeping profits at a high level can be a daunting task. What if we told you that your bottom line wasn’t affected by the rising cost of raw materials or a fierce competitors, but by the deductions which slowly reduce your income.

The administration of deductions isn’t the most enjoyable part of running a company but it’s vital for CPG brands. Each time a retailer fails to settle an invoice or chargeback, regardless of charges, promotions or compliance issues, you lose your hard-earned revenue. If cash flow is already tight and tight, these deductions could be all the difference between growth and struggles.

Deficit management mistakes can cost you a lot of cash

Let’s be real: Nobody launches a CPG brand hoping to spend endless hours fighting over deductions distributors. Business owners quickly realize, deductions for these can be significant.

If you do not have a good deduction management strategy, your company is likely to constantly feel like it’s losing money. It’s tiring, time-consuming and, worse of all it distracts your attention from the most important thing: growing your business.

What makes it even more challenging is the inability to communicate. It’s sometimes difficult to determine which deductions are valid since many deductions are based on no explanation. Some companies might not be aware of how much they’re losing until they examine their books. In the meantime the thousands or even millions might have already been lost.

Deduction Management Software A Game-Changing Solution

The good news? It’s not necessary to solve this problem manually. Software for managing deductions automatizes the process of tracking, analyzing, as well as resolving, deductions.

Businesses can now see where their money goes and why certain deductions were made, without the need to search through spreadsheets. Modern software tools also permit firms to quickly contest false claims, thereby saving time, and also allowing them to recuperate lost revenue.

Automation can mean less human error, and a higher level of accuracy when it comes to financial reporting. This type of transparency is crucial when running a CPG company. It gives you the confidence needed to expand, invest in and even negotiate with retailers.

Food & Beverage consultants are crucial to the success of your business

While software can be an extremely effective tool when in appropriate hands, it’s important to have a professional with you. A food and beverage consultant can help.

Consultants with experience in food industry consulting can help CPG brands set up smarter deduction management strategies, train teams on best practices, and even negotiate better terms with distributors. They are familiar with the industry inside out and can offer insight that might otherwise take years to learn about.

The right advice for brands that are growing could mean the difference between endless debates about deductions and a procedure that is streamlined and saves money.

Final Thoughts

Deduction management doesn’t only concern about recouping money lost, it’s also about protecting your company’s financial health. Making sure you control your deductions is crucial factor to regulating your cash flow and future.

Make the most of the situation and turn what was once a hassle into an opportunity for your company to become smarter. Your bottom line will thank you.