The CPG Margin Trap: How Retail Channels Can Bleed Your Business Dry and How to Protect Yourself
The real math behind retail, why the channels that look like wins often aren't, and how relationships built the accounts no broker could have landed.
It finallly happened! You busted your ass to get your product into a store that actually wants to put it on their shelves. The dream! (they say) And then the invoices started coming in that include slotting fees, spoilage allowances, distributor margins, co-man costs, demo days and you realized the math ain’t mathin’. The retailer is making money. The distributor is making money. The freight carrier is making money. You’re covering the gap with revenue from somewhere else and calling it growth.
This is the CPG margin trap. And it’s not a mistake you made. It’s how the system is built.
Teresa Ging has been running Sugar Bliss for 19 years. She bootstrapped from a home kitchen in downtown Chicago to having her products purchased by the Chicago Bears, McCormick Place, Mariano’s, and airport locations with zero outside investors and 100% ownership. She also spent two years inside conventional retail and is now exiting it strategically because she ran the numbers and found that conventional retail was costing her more than providing an ROI.
The core growth lever in this conversation is simple and consistently underestimated: in-person relationships, pursued with discipline and followed up on, are the direct pipeline to the contracts that actually move the business.
This week, you’re going to walk away with a simple way to:
Evaluate whether a sales channel is building your business or extracting from it
Set the margin floor you need before entering any retail or distribution deal
Use CPG presence strategically as a marketing tool, not a profit center
Build the kind of in-person relationship pipeline that lands enterprise accounts
Make a clean, ego-free exit from a channel that isn’t working
By the end, you should be able to:
Identify which of your current channels you are actually making money in
Articulate the real cost stack in any CPG deal before you sign
Know what a healthy benchmark looks like before entering a new channel
Start or restart a consistent relationship-building practice
Feel like a strategist about your channels, not a founder who just has to make it work
