Most CPG founders check their bank balance every day but look at their financials once a month — or once a quarter. That gap between instinct and information is where bad decisions get made.
The 30-Minute Rule
Cash Runway
Cash runway is the number of weeks (or months) until your bank account hits zero, based on your current burn rate. It is the single most important number for any CPG brand that is not yet profitable.
How to Calculate Cash Runway
Net cash burn means total cash out minus total cash in — not just expenses, but actual cash movements including inventory purchases, collections, and debt service.
Cash Runway Benchmarks
Red Flags
- Runway below 4 months without an active fundraise or credit line
- Runway decreasing for 4+ consecutive weeks — your burn is accelerating
- A large inventory purchase or co-man run that will cut runway by 6+ weeks in a single hit
Gross Margin by SKU
Your gross margin at the individual SKU level — revenue minus COGS for each product you sell. Not blended across your portfolio, but broken out so you can see which products are carrying the business and which are dragging it down.
SKU-Level Margin Formula
Target Gross Margins by Category
Pro Tip
Red Flags
- Any SKU with gross margins below 30% — almost certainly unprofitable after trade spend and fulfillment
- Margins declining 3+ consecutive weeks without a known cause
- A low-margin SKU representing a disproportionate share of sales volume
Inventory Weeks on Hand
Inventory weeks on hand tells you how many weeks your current inventory will last at your current rate of sales. It is the bridge between your supply chain and your cash flow — too many weeks and you have cash trapped in product, too few and you risk stock-outs.
How to Calculate Weeks on Hand
Inventory Weeks on Hand — Healthy Ranges
Red Flags
- Weeks on hand increasing while sales velocity is flat or declining
- A specific SKU with 16+ weeks on hand — candidate for write-off or liquidation
- Below 3 weeks with a 4-week production lead time — stock-out risk that could cost retailer placements
Customer Acquisition Cost
Customer acquisition cost measures how much you spend to acquire a new customer. In CPG this applies differently across channels — for DTC, it is a straightforward marketing spend calculation. For retail, it encompasses trade spend, slotting fees, and demos needed to establish a product in a new door.
DTC CAC Calculation
DTC CAC as % of First-Order Revenue
Pro Tip
Red Flags
- DTC CAC exceeding 50% of first-order revenue — only works with a very high repeat rate
- CAC increasing for 4+ consecutive weeks — audience saturation or creative fatigue
- High retail launch costs per door with low initial velocity
Accounts Receivable Aging
Accounts receivable aging breaks down how much money is owed to you and how long it has been outstanding. In CPG, where retailer and distributor payment terms can be long and deductions are common, AR aging is your early warning system for cash collection problems.
AR Aging — Healthy Distribution
Key Insight
Red Flags
- Total AR growing faster than revenue — you are shipping more but not collecting proportionally
- A single large customer moving into the 60+ day bucket — signals financial trouble or a dispute
- Unexplained deductions appearing consistently — deduction recovery can represent 2–4% of gross revenue
Putting It All Together
These five metrics take 30 minutes to update once you have the systems in place. Set up a simple dashboard — a spreadsheet works fine — and update it every Monday morning. Review it with your leadership team or your fractional CFO weekly.
Why Five Metrics Together
Your Weekly Dashboard Checklist
Bottom Line