
Loading summary
Abby June Richards
Foreign.
Adam Yee
Welcome to the My Food Job Rocks Podcast, a podcast where interview experts in the food industry and learn about the career paths. While gaining some interesting insights might help you in your career. I'm your host of food scientist Adam Yee and today I'm digging into the numbers with Abby June Richards, Founder and Fractional CFO at the CPG cfo, a fractional finance firm that specifically helps consumer packaged goods brands know their numbers members. Abby is a CPA in Texas with a passion for consumer products and a desire to help founders in the CPG community reach their goals for their brand. With over 22 years of experience in accounting technology, ERP implementation and bookkeeping, her special talent is being able to see through the big picture and end goals and related to the details and next steps of your business. Best of all, she can help you develop a plan and then lead a team to execute it. What I really enjoyed about this conversation was Abby's no nonsense honesty. She explains things really well and even terms that, you know, I was kind of uncomfortable not understanding. She has explained pretty clearly in this interview and this is why I kind of brought her on is I wanted someone to really explain to me how
Podcast Interviewer
to get a head start on looking
Adam Yee
at finances in a food business. I think this is one of the most underrated things we learn about specifically in food science, honestly. But I I do think working in the consumer package good space finances is something that everyone has to deal with but no one wants to talk about. And I think the the ones who are really good at it are really good business people. But basically she tells you great advice such as if you don't have a margin, you don't have a business. But you know, she's a very supportive person and you could just tell from her voice and the way she talks about things. She really wants to help you out. There's a few stories in this interview where Abby brings out a few finance stories. One that I really like in particular was this pizza that was accidentally sold in stores for $25 a price tag, but surprisingly people were still buying it. So a little change here and there caused just a little known finance error to really go well for them. It's a really good example of how knowing your value can change everything. So if you've ever felt overwhelmed by financial models or some ratios or you know, what, what is this an audit or not? Or just the word finance in general, I think this is a great episode that's going to make a lot of things click. Enjoy this episode with Abby. I'm Sure. You're going to learn a lot.
Podcast Interviewer
So Abby, I've seen your content for quite a while, talking about finances and um, you know, I, I think whenever I do like consulting with small brands, I think the biggest thing I tell them is like, you have to know your numbers. And I don't even know if I know my numbers honestly. Like it's, it's a lot of into a session. It could be, yeah, it's a free, free consulting session. That's how I usually do these things with the guys. It's like a gotcha. I just want free information. That's what I do with James Richardson. So it's, you know, for me it's worth it. So. But I will say, like, I don't think I even know particularly what the numbers actually mean. And I think as I've been kind of digging through, like let's say working with CBG or even at one point having my own consumer pairs good startups, I didn't realize how important these numbers were. So I'm glad to have you on my food job rocks to kind of explain what the numbers mean in a finance point of view. But first, Abby, I'd love to hear kind of, did you ever expect to be in this role of starting your own business, helping founders with their finances?
Abby June Richards
Yeah, I think. I think in a certain sense I did. Whenever I was young, I always wanted to help business owners, right. Like I wanted to do consulting in some capacity at some point. I didn't know what that would look like and I kind of wanted to work with like Do Gooders. I knew that I didn't know exactly what that would look like. So at one point I worked with like not for profits. I. When I was in public accounting and consulting for a firm, I said I work for all sorts of different industries, right. So I didn't necessarily know CPG from the beginning, but I found over time that when people would talk about other industries, it was like the Peanuts parents and they're just like, wah, wah. And I'm just like, I can't unders. I can't process what you're saying because it just doesn't interest me anymore. And all I cared about was emerging CPG at a certain point. So that's why I switched started my own company, I guess.
Podcast Interviewer
Why did you care? What, what made you interested in emerging cpg? Was there like a story or a brand?
Abby June Richards
I think it's just it. Well, I had a deep interest in just like better for you products in general for my own purposes. Right. Like My mom was really conscious of health growing up. And then my husband and I used to go to the, like, health food store here in town when the only one was like half of another store that was the only place you could really buy like organic food or anything, like vegetarian or anything like that. So we were interested in that for a long time. And so of course I would notice, you know, new brands and whatnot. And. But then, yeah, my, my work, it started to be like, oh, well, what if I could work with those people, right? Like, and I just, that just got me so incredibly excited.
Podcast Interviewer
And how did you eventually start working with those people? So, like, like, did you. How did you build this client? But you seem to be pretty well known on LinkedIn as kind of a financial expert, specifically for CPG or consumer packaged goods. I love to just hear how you built your business up.
Abby June Richards
Yeah, so I did work with CPG brands when I had a job, right, When I had a W2 and when I was in consulting, I did work with CPG brands there. So that was what gave me like the taste. And then we, we had some startups that came to us and wanted like a quote, and I was like, so excited. I went out and bought their, bought their product online and I, you know, got it shipped to me. And so I come to the meeting and, you know, I've tried it and everything and. But they didn't end up going with us. And I was like, am I really in the right place to like, serve emerging brands? And so honestly, it was a, it was a huge leap of faith. Like, I was just like, this is all I'm going to do. I had the experience, right? I had some experience, but I also knew that I, there was more I could learn. And so I just listened to all the podcasts I read, right? Dr. James Richardson's book. I just, all the things I could think of, listening right, to podcasts like this and gave myself sort of an MBA in CPG to a degree. But yeah, some of it was just, you know, I had the finance lens and then founders would bring the CPG part in the beginning, right? More so, like, I mean, I didn't know everything about it, so we sort of worked through that together.
Podcast Interviewer
Yeah, this might be a very bare bones question, but, you know, I like these type of questions. What is the difference between finance and accounting then? And should we, should we mix those together or should they be separate in a sense?
Abby June Richards
Yeah. So finance and accounting is at, at the end of the day, is your numbers right? Like that end up Touching cash. Accounting is how you get the numbers into a place where you can review the past. Right. And finance is more so contributing to the future. So finance, one of the definitions is helping the business make better decisions. So I had done a ton of accounting and had definitely helped people make decisions. But when I went out on my own, that's where I was like, no, no more accounting I've done. I did that for, you know, 20 plus years. You know, bookkeeping and office management and all the things, technology, implementation. And now all I'm going to do is forward looking. And so that's when I got into like the models and forecasting and whatnot.
Podcast Interviewer
So you, you say you had to learn that by yourself or did you have any tools or education to help you learn financial models?
Abby June Richards
Right? That's a good question. So I mean I am a cpa like that, that's, that is clear. I took, you know, you know, as part of, I mean I got a business degree, I got a business degree, I went back for accounting, I took the CPA exams. I mean as part of the, in the CPA program, the capstone course was financial statement analysis. And I got like a hundred, a hundred on the first exam because I was like, yeah, like I know all the pieces, so of course I can put them together, no problem. It's not like I had built financial models over and over every day when I went out on my own, I was like, I can do this, I know I can. But it, it was, I had the ingredients, I just had to mix them up.
Podcast Interviewer
That's good to know. CPA is a certified public accountant, right? Mm. How does that, or what do you need to do to get that?
Abby June Richards
So a cpa, the requirements are a little different by state, but in my state, I know, I believe the requirement is 150 hours. You have to have like 30 some odd hours in business, 30 in accounting. You know, in terms of college, you have to have a year, about a year of work under another CPA that signs off on your hours and then you also pass a four part exam and the coursework is over taxes. Financial accounting. So GAAP accounting generally accepted, you know, accounting principles in the United States
Podcast Interviewer
and
Abby June Richards
you know, all those rules and regulations and whatnot. And then also again, you know, how financial statements interact and um, thinking about business, larger businesses that are like on the New York Stock Exchange, like what sort of disclosures do they have to have? And we just go through all sorts of things.
Podcast Interviewer
Hmm. So now you have the credentials and the credibility and you're Getting kind of clients from consumer tires, goods industry, I guess. What kind of ways have you, have people noticed you in a sense? What do you think? Maybe it's your content, maybe it's the community that you've, you're based in. I'd love to hear a little bit more about how you've kind of grown the business because from what I saw in some posts, you have grown quite a bit. Right?
Abby June Richards
Yeah, we've grown. We've really. And not just growth in terms of like growing revenue. Right. It's also growth in the type of value that we add. Right. It's not like, let's say you come to me and you say, I think I need a financial model. Like that's. People keep saying, where's your financial model? So I need one. But I'm. And at one point I would have just done that, right? I would just said, okay, yeah, let's build a financial model. Now we've gotten to the point where it's like, well, what do you really need right now? And a lot of times what they really need in that moment is help with the business mechanics and making a decision and not necessarily building out an operation, a complex operational model that's really detailed and they're going to have to maintain. Because I found over and over again that people would. And not just my financial models. Everybody's financial models. They get a model and then it just sits.
Podcast Interviewer
Yep.
Abby June Richards
Right. So that's a problem for me. I don't like that. And so I was like, how do I solve this problem? So, yes, that's a little bit of an aside, but to answer your question about how I grew, I, you know, I show up. I am always trying to learn. I spend a ton of my time doing that. I am talking about what I'm doing. As soon as I tell a founder something and they're like, ooh, light bulb moment. I'm like posted on LinkedIn. You know, like, I try to be very free with the advice that I give and kind of sharing the wealth. Right. Because I know that founders need it and that has gotten notice from people that I would have never thought would care about me.
Podcast Interviewer
Yeah, I'm sure it's a, it's a really good tool. Let's, let's talk a little bit about financial models. You know, I, I ran a, I was co founder of a CPG business and you know, some of the times, like my, my business partner was giving me financial models, I kind of got overwhelmed by them. And I thought, and sometimes when I dug into Them, they didn't make a lot of sense. I love your take on financial models.
Abby June Richards
Oh man. I'm going to, I'm going to anger
Podcast Interviewer
all the only scientists listening to this is fine, fractional.
Abby June Richards
So the thing is, we just want to be thoughtful. Is it purpose built? What job are you actually asking it to do? And is it purpose built for that job? So what I found was the, the models that we use for clients, they are great for operations. Right. And we're using them over time. And when I say clients are retainer clients, so that are with us long term, months, years, you know, there's a lot of details in there and we want to be really precise and really accurate. Right. And we can handle that level of detail because that's what we do in the, in the company. But what I found was if we build a model like that, even if it's a little less detailed, you know, or even quite a bit less detailed than what we use internally, it still can be really overwhelming for the founders and they may not actually use it. So it's like, what are you actually going to use it for? And if all you're using it for is to communicate to an investor what your plan is in terms of how your unit economics is, are, are going to decline over time and how you expect to grow in terms of, you know, how much you sell at that point, it's like, okay, well we don't need a full operational model.
Podcast Interviewer
Hmm. Okay. Yeah. I think at least some of the. I've worked in a lot of different startups and sometimes the main goal of the startups ask for a financial model is to make a graphic that proves to investor, you know what you're talking about and to raise money. From what I understand, we'd love your thoughts on that just in general, but in general, that's how I've seen a lot of financial models being used. It doesn't sound like the right approach, but I'd love to hear what you think.
Abby June Richards
Yeah, I mean, a financial model is demonstrating the mechanics of the business. That's what you need it to do. Right. It's demonstrating the mechanics of the business, whether that's on a monthly basis or whether that's on a yearly basis. Right. And just kind of like broad strokes. But at the end of the day, we need to demonstrate the mechanics of the business in a way that shows investors that you know how you're doing. Yeah. You know what you're doing, you know how the business is actually going to work or at least that you have Hired someone that knows and is going to help you with it for sure. So using a financial model to create your finance slide and the charts and whatnot is a fully valid reason, especially if you. That's a really boiled down take, right? It's just one graphic and it's like, here's our, you know, it's a stat chart, stat bar chart and it's our channel mix, you know, stacked each year. And this is how we're gonna, we're planning to grow. I mean, the whole thing is when you talk to an investor, you need to help them understand what you're planning to do. So if it communicates that plan in a really succinct way that it did its job and then you have the financial model behind it so that they can see how did they build up these assumptions? Like, are they taking their erewhon velocities and translating that to the neighborhood grocery store in Ohio? Like that's probably not going to come to fruition. And they can kind of pick it apart and make sure that your assumptions are reasonable.
Podcast Interviewer
Okay, I see. So you sent me this document called the Cashfight Framework. Is that designed to build a financial model with kind of more thought.
Abby June Richards
When you say like the scaled down
Podcast Interviewer
version that we do, in a sense, yeah. Or I guess. Well, how would you describe the Cash Fight Framework?
Abby June Richards
Yeah, the Cache Fight framework is a free download on our website. It is, you know, nine factors that influence how you manage cash and how it moves through your business. So that is the Cash Fight Framework. Now, our Cash Fight decision model that we do for clients is a scaled down version of a financial model that just relies on key inputs where you can see really quickly, hey, look how impactful retention is. Look how we change CAC here. And at your current cac, you have.
Podcast Interviewer
CAC is a customer acquisition cost, right?
Abby June Richards
Oh, yes. CAC is customer acquisition cost. Thank you for helping me make sure that's all. Thank you. Yes. So at a specific, at a, you know, $70 customer acquisition cost, let's look at what that does to your, you know, your customer journey profit even after six months. Oh, look, we're still losing money on that cohort even after six months. Like that's probably not what we want to be doing, right? We're not just trying to pump top line. We want to actually have contribution profit at the end of the day, you know, and I'll define that quickly. It's your, you know, the, the price that you charge minus any discounts, minus the cost of your product, minus the variable Shipping, fulfillment. Right. And then also minus the customer acquisition cost. So it's, it's like what is that customer worth at the end of the day?
Podcast Interviewer
What, what are like these hidden costs in terms of like tracking a food product? Because I think, you know, we hear a lot of like models that say like oh, 50 something margin. Right. And like that. And I, I hear this all the time and some people confuse like net versus gross or maybe I confuse them. So I'd love to hear just in general, how do we price out or how do we think about money in a consumer package? Good.
Abby June Richards
So when you say margins. Yes. It's not just confusing for you, it's confusing for everyone. One of the ways that I like to cut through the confusion is to talk about your product cost and your shelf price, your retail price in terms of a ratio instead of as a percentage. Because to your point, are we talking about gross revenue? Are we talking about net revenue? Some people say like product margin and what they really mean is like your cogs, that's a percentage of the selling price.
Podcast Interviewer
Okay.
Abby June Richards
Right. To the consumer. And so it can, or, or even as a percentage of the selling price to be whole, you know, the, the retailer, the distributor. And because CBG brands work in so many different channels, you really have to talk about each channel specifically. Right. I mean it can be, you can talk about your, your margin as a company, but you, it doesn't really say a whole lot. Right. Like we're not able to really understand based on just like one number. What does that actually mean?
Podcast Interviewer
Yeah.
Abby June Richards
So I like to think about it in terms of a ratio. If we're just like brass tax. Right. Like cheat code. And the one that I kind of always come back to is 4 to 1. So if you have a GS at
Podcast Interviewer
the same thing, actually, funny enough. Yeah, yeah, yeah. I was, I was interviewing, I was interviewed by her and she, she was mentioning that. So. Okay, okay. I like that. I like two sets of data that say the same thing. Okay.
Abby June Richards
Yeah, yeah. It gives you, gives you comfort over that.
Podcast Interviewer
Yeah, a little bit.
Abby June Richards
Yes. So, and that's not, that's not all the time. Right. If you're a beauty brand, you actually need way, you need more margin, you need a higher ratio because of the fact that you are going to end up spending a lot of money on marketing. Right. So those types of things. And that's a simplification of it, but if that makes sense. Right. And then there are other like beverage, like you're not going to hit 4 to 1 out of the Gate. Right. Like, that's just.
Podcast Interviewer
Why is that just really silly?
Abby June Richards
So you're shipping liquid and in beverage, the MOQs, the minimum order quantities can be fairly high, especially if you want to do like printed cans. Right. So it's, there's definitely some flexibility in it in that like, I have one client who is cash flowing, but their margins are really low. They have been able to get to really high volume with really low overhead.
Podcast Interviewer
Okay, got it.
Abby June Richards
So it's like, it's a, it's the full picture, right. It's the mechanic. It has to fit together. Like if you're a beauty brand and you have, you know, you've got lower cogs, you've got this higher customer acquisition costs. Right. But. And you keep your overhead low in the beginning, maybe you can still cash flow it. Right. Like you, it just, it all has to work together.
Podcast Interviewer
What are generally the common things that CPG founders are surprised about when it comes to their numbers?
Abby June Richards
They are surprised at how powerful certain levers can be. So when you increase price, that can be really powerful, especially if you're operating on really slim net margins because you could increase your price by like 10% and like double your contribution margin because it's already so small. Right. Like you just add a little and that helps. It can help so much. They are, you know, I kind of alluded to this earlier. They're also surprised how powerful retention is if you're paying to acquire customers in D.C. like E Commerce, like a Shopify site, your own Shopify. If you're paying to acquire those customers and you know they cost a certain amount if they come back four times instead of three times. Right. You didn't pay for that fourth sale. You didn't pay for the second or third. So you get another one. So that's where you know the email, emails, retention and marketing texts. Right. Like keeping them engaged with your brand and really interested and talking about how to use your product and recipes if you're food and beverage. Right. Those sorts of things can be really huge.
Podcast Interviewer
Huh. Okay, that, that's really interesting. I, I love little tricks like that because I think, you know, I, I think at least whenever I look at the numbers there, there are certain things that can. And not even just financial numbers, but, you know, formulation numbers or processing numbers. Like we, we also figure out the same thing that, that a certain change can really have multiple impacts about pricing though. You know, a lot of, a lot of CPG entrepreneurs are scared of raising prices. I'd love to understand kind of a rationale behind that or have you seen maybe through trends of people raising their prices through, you know, maybe some stress in the supply chain or just because they have to. I'd love to hear some strategies about that or how to think about that, I guess.
Abby June Richards
Yeah. Well, the number one thing is if you're not making money, if you don't have the Martin, you don't have a business. Right. So it's better to, you know, kind of zooming out just a little bit. You, you're better off raising prices and losing some accounts. You can end up with more money at the end of the day by saying goodbye to some unprofitable accounts. So if that helps at all with sort of the courage aspect of it. Right, but, but pricing at the end of the day, I mean, it's, it's everything, right? Nothing downstream works if pricing doesn't work. So I say, I always say, if you're special, charge more. Do not price with the incumbents because you're not them. Right? You're, you're special. And if you're not special, what's the point? And that's, that's kind of a, maybe a tough way to say that. But it's also like, let's just, that's just how I work. It's like, let's get down to the meat of it. Like, let's get to what's important and help you really quickly. So I have a story for this one. So I'm pricing. So. And this is, this is public. You can see it on the founders LinkedIn if you scroll back. But Damiano, the founder of Lupini. So they're a, you know, newer frozen pizza brand and they have a ton of great benefits, so definitely check it out. But they were in a. He told a story. They were in a new store for a week and he heard that they had only sold three pizzas. And he was like, oh, no. Like, why? I don't understand. This is not our normal velocity performance. Yeah, velocity. So we say velocity for units per store per week that are on average. And so they were in this new store and that was just a huge bummer for him. He was like, why aren't we performing better? So he went into the store, right? Which is a big one. He walked into the store to see what's going on, which is like, do that, right?
Podcast Interviewer
Yeah. Go to places. Yes, go to places.
Abby June Richards
Go to stores. Don't just like, sit behind the keyboard and, and, and analyze data. But he realized that they were priced at 2549, a pizza which is. Okay, now 70% higher than their suggested retail price. But people bought three pizzas. They bought. They still bought three pizzas at 25 a piece. And so to me, I'm like that special. That's a CPG brand worth pursuing. Right? Because people are. Are that interested in it. And that's not to say price your frozen pizza brand at 25 a pop. But it's all. It's like, know your value, right? And know. Know what? How much people value you.
Podcast Interviewer
Huh. That's. Okay. That actually takes me to a segue to one of my next questions. But so this 25 pizza, that he didn't set that price. Right. The retailer did. Right.
Abby June Richards
It was an accident. They fixed it.
Podcast Interviewer
Okay.
Abby June Richards
Yeah.
Podcast Interviewer
Yeah. Okay.
Abby June Richards
Yeah. It was a total accident. It was not. It was a mistake.
Podcast Interviewer
Okay. That's funny. Well, okay, so, you know, I. From what I understand, a lot of anguish, a lot of CPG founders have is through shipping, fulfillment, and, you know, distribution. I don't know if those are all the same lumped together scenarios, but for the sake of argument, I'll do that. But generally, from what I understand, a lot of these are a lot of these costs that are in like shipping, fulfillment and distribution, are they. They're out of your control, from what I understand. I'd love to hear more about that side of the finance angle because I think that really trips up a lot of people. Especially they go through like a distributor that takes a good chunk of their margins. For instance.
Abby June Richards
Yeah. Generally whenever we are going through a distributor, we're not seeing that show up as shipping or fulfillment because they are just generally, well, in many cases paying less. And then they're take. They might pick it up, right? Sometimes it does. So it just depends on the distributor. But yeah, I mean, again, it has to work in the bigger picture. So if you're spending more on that, again, beverage brand. Right. Super heavy shipping liquid around all over the country, you may have to have a lot more organic approach on customer acquisition. Right. You may have to have a lot lower cogs. Right. You may not be able to have like, you know, 100% organic juice. Right. Like, I mean, that's. Don't get. I love that. But, but is it realistic? Right? Is. Is that a business or is that a hobby? And so, yeah, it has to be balanced against other things, but you can get creative. Right. So we had one client who sells beverage mixers. So they're shipping, you know, these big heavy bottles of mix. And when we look at the numbers, it's. It's not necessarily like, okay, well this is a freight rate problem because when you kind of, you get kind of myopic about specific things. Like yes, you want to, you want to work on freight rates, like get different quotes, talk to different 3pls, of course, do that piece. But then also we zoomed out and it's like, okay, let's think about the consumer behavior. If people really like the product, but they're not necessarily going to go in the store and buy like a 32 ounce bottle of mix every week. Is that hurting us on shelf. And then also we're shipping a ton, you know, the. It's very heavy. And so that's eating into like margins and cash. And once they saw that, they started testing smaller formats.
Podcast Interviewer
Okay.
Abby June Richards
Little pouches, like individual pouches or even like a three serving pouch. So that can lower fulfillment costs, you know, improve the consumption rate and then it frees up working capital to do all sorts of other things.
Podcast Interviewer
Okay, wow. So you mentioned zooming out and it seems like this is a very good strategy for, for most businesses, right. The zoom out of your finances. Are there any strategies to do that in a sense where, you know, I think CPT entrepreneurs have to deal with a lot of things. Right. They have to deal with so many things about the business, but I think finance for some is like the least popular thing they want to deal with. Do you have any kind of advice or even tactics on zooming out of your business? Is it more. Someone should take responsibility of that or is it more? I guess, or how often should you do it? You know, just, just in general advice on that zooming out tactic.
Abby June Richards
Yeah. So I would say as a founder, you want to be reviewing your results every month. Right. At a minimum. I mean if you're, if you're in D2C, you probably want to be looking at like all the marketing numbers.
Podcast Interviewer
Look at your dashboard every week or every day.
Abby June Richards
Yeah. Look at things more often. But, but in terms of the financials, especially if you're early stage, you're probably not going to have daily cogs post. You may not have like an inventory management system that's doing all these automatic postings. You probably have like a cogs entry at the end of the month and different things like that. So monthly, sit down with your numbers and look at what they're telling you. So the Cash Right framework, that free download that we have available on the website that walks you through. Right. Those, those sort of nine areas. But I will say that we have found that it can be difficult if a Founder is not, you know, a finance person. They can still get lost. Right. And. And that's. I mean, that's what we do, right? We come in, we kind of strip out the noise and say, okay, here's what you should really focus on and kind of like triage it, right? It's like, okay, focus on this first, then you can do this. Then come back to us when you're ready and, you know, you've grown to this point, and we can help with, you know, next steps or whatnot. You know, I give them as much as I can at that moment with ideally not overwhelming them, because overwhelmed founders do nothing. And that's not. That's not like a gift to give them more information if they're not going to do anything with it.
Podcast Interviewer
I just. That's a. That's a. I have another question on that. Like, what kind of founders do you get usually? Do you get someone who's a bit overwhelmed and panicking, or do you get someone who's like, okay, I have to really consider my finances, or. I'm sure there's both at the same time, but I love to understand why people would go to you essentially for finance work or what. Have you noticed a commonality between your client base, especially the ones who are like, prospecting?
Abby June Richards
Yeah. So when people tend to come in is, you know, when there's a big decision to make, there's a lot on the line, right. They might be about to raise capital, they might have just raised capital, and they're like, ooh, we need to manage capital. Right?
Podcast Interviewer
Yeah, that's F1.
Abby June Richards
Yeah. Ideally, they are working with someone or they have their own expertise to manage money when they have a lot of it. You know, they're expanding into retail, they're ramping paid acquisition, you know, paid ads on, you know, online or. Or they're just, you know, they know that their business has gotten big and complicated enough that they're just trying to grow without running out of cash. And they feel like that founder intuition is not enough at that point. But to answer your question about, you know, what stage brand we work with earlier stage brands, right. They're. They've. They just need some quick, like a gut check, and we can come in with our cashfight decision, model engagement. So we step in really quickly, break it down, identify constraints. Right.
Podcast Interviewer
Would you say it's almost like a financial audit? Would you say it's. Sorry to interrupt. Do you think it's kind of like more like a financial audit in a sense?
Abby June Richards
I would not call it an Audit. Because I'm a cpa.
Podcast Interviewer
Okay.
Abby June Richards
That's a legal term, not what that is. Yeah, Yeah. I have to be really careful about the word audit. Other people can use it. I can't.
Podcast Interviewer
Oh, interesting.
Abby June Richards
Yeah. I could never say that I'm auditing. I'm not even. I don't have a firm to audit. It's a big deal. So, anyway, that's a good point.
Podcast Interviewer
I did not know this.
Abby June Richards
It's fine. I mean, that's kind of a boring thing. But I can't say audit. Other people can. But. Yeah, I mean, it can also be, you know, once they get up to. Probably our smallest brand that has come to us and wanted to start a retainer is maybe at half a million, but they're like, we have, like, all these retailers we're talking to. We're hiring a broker, we're hiring. We're doing all these things. And so it's like, okay, there's a lot on the line. We need you involved. Right. Like, we want you to build the financial model. We want you to maintain the financial model. We're going to actualize every month. You know, we're building out all those forecasts, and we're your regular fractional cfo. As you scale and decisions are getting even more complex.
Podcast Interviewer
Yeah. So that basically when cash flow is all over the place and you need something to kind of funnel that through. Right. Yeah. Awesome. Okay. So this is all really good information. It has me thinking, like, I don't. I don't know that much about finances. So it's just. I think this is just super useful. And it is kind of the lifeblood of a business is through. It's. You know, as you mentioned before, like, it's cash and how it can make money. We have. I. I think we in the operations and even the food science angle, I would say, aren't really focused on this. And sometimes I. I've been trying to educate my colleagues, like, this is important to really understand how a product is actually sold. I guess I'd love to understand margins because you mentioned a few things like, you know, does that have to be 100% orange juice? Our margins better on, like, makeup or skincare versus food. I'd love to kind of understand some things that you've seen that kind of have really improved, kind of either the. The numbers, essentially.
Abby June Richards
Yeah. I mean, it's. It's what you said, it's the collaboration between finance and operations. That's where the magic happens. Right. Is collaboration through sales, finance, and operations. At the end of the day in, in, in any business really, that's how you will be successful is collaborating between those areas because they all have their different goals.
Podcast Interviewer
Yeah.
Abby June Richards
Right. So finance wants to make money, sales wants to just sell more. And then operations. Right. You're thinking more about, you know, doing things really well and also having like the absolute best product I would imagine. Right. Like really high quality. And so whenever you, whenever you collaborate, that's when, that's when you are able to get to a better place. Because it's like finance can kind of come in and say, here's our target. This is based on this, this price, which is the highest price that anybody's going to pay for this product. Right. Like that, this type of product. We know that even if at a premium, people are going to pay this. Okay, so let's put our four to one hat on. And we say 25% of that is all that we can spend on the product. And keeping in mind that that includes the ingredients, the process, processing, tolling, freight in, customs duties, tariffs, everything that it takes to get your product ready to sell. Right. So then we back into like, how much can we even really afford on ingredients? And so what does this product need to kind of look like? Right. And, and it's a, it's a rebalancing. Right. Because maybe if you lower the quality, well now the price isn't there. And so it has to be collaborative. There's, there's no way we do it without that collaboration.
Podcast Interviewer
Yeah. It's something I try to teach entrepreneurs who, who want to start food businesses too, is that eventually you're going to deal with a trade off situation of quality versus cost. You, you definitely prove me wrong on that end. But it does seem like that inherently will always go down to it in some part of some point of the business.
Abby June Richards
Yeah. And I mean, part of it's kind of, you know, a lot of people get, it's kind of a shame. Right. It's like, it's like, well, we can't make the product this, this amazing product that we want to make and people want to buy, but they can, they're not going to pay $20 for it. And so it's like, it's just a shame that maybe it doesn't get to exist out of maybe a farmer's market, outside of a farmer's market. And so, I mean, that's the reality of it. It's just, you can't scale something that doesn't have margins. Yeah, exactly. I'll say one thing I have worked with Brands that were just beautiful, beautiful brands. I mean, the brand was amazing. The founder is amazing. The product is just out of this world and it just didn't work because it was too expensive. And I, it breaks my heart.
Podcast Interviewer
Yeah, it's a, it's a very tough. You know, this is the reality of food. It is specifically CPG and specifically food. It is a generally a low margin product and so any little change in complexity will add up and it can also shift really drastically. Right. Like supply chain crunches from like, let's say chocolate prices or egg prices or whatever can really shift a business. I think you just have to be
Adam Yee
very cautious about it.
Podcast Interviewer
And, you know, the founders always have to make these hard choices when it comes to that. Obviously the decision is up to them at the end of the day, but that is the trade off that generally happens, right?
Abby June Richards
Yeah. Yeah. Unless you're going to be like, you know, an artisan again. Artists.
Podcast Interviewer
Yeah.
Abby June Richards
Brand, Farmers market brand. And sometimes those can work and you could make a lifestyle business out of that. And there's nothing wrong with that. It's just being really honest with yourself about what am I doing. What is this product? Right. Like what function does it serve as a business for?
Podcast Interviewer
Sure. Abby, I'm learning a lot here and we're going to wrap up this interview by just saying where can we find you for advice? Where do you usually post and you know, generally how, how can people contact you if they need help with like their financials?
Abby June Richards
Yeah, so the, the, you know, of course you can find us@thecpgcfo.com There's a lot of thinking there, including the resources like cashfight Framework, cash flow forecasting tool and our know your numbers handout, which is questions that investors ask. In addition to that, I do post very regularly on LinkedIn, Instagram, technically, TikTok. I don't get on there. We only get on there like post. And I know that's not a good strategy, but it's hard.
Podcast Interviewer
It's exhausting.
Abby June Richards
Yeah, we like posting ghosts over there.
Podcast Interviewer
I'm not a tiktoker.
Abby June Richards
I'm not doing any dance or anything, but thank you for, for having me. Adam.
Podcast Interviewer
No, this is great. Again, I'm, I'm. I feel like I don't have a good understanding and I think a lot of people don't have a good ace understanding finances. So it's always great to have an expert to talk about something that I think is well talked about in the startup side of things, but not well talked about in other sides of like essentially the food industry. So thank you so much for educating me specifically, but also our audience.
Abby June Richards
You're welcome. Always, always happy to give a class.
Podcast Interviewer
All right, well, I'll keep that in mind.
Adam Yee
This is the end of the show and here's something to chew on. So why did I bring a finance person on to the show? Even though this is like a food job podcast one, I think it's important to understand, like, you can still like do something that seems like, you know, finance or accounting or I don't know. Well, I could argue marketing. You can still apply this to food. And I think when you apply it to food, there's, there's a special type of like, joy you get out of it. Like if you did finance for like medical devices or, I don't know, construction sites, I don't think you're gonna have as much fun or, or versus, like a consumer bags, goods brand. I also think, like, in general it is a huge pain point. All three of those things, accounting, financial, finance, and marketing, that a lot of people who want to do food or do food businesses don't really pay attention to. And that's why there's a need for it. So that's one reason. I think the more important number two reason is that I just noticed people in the food industry are quite bad at finances. There's many reasons why. One, the food is just such a low margin product. When you look at the numbers of food, it can get quite depressing. Therefore no one wants to do them. But this saves your life at the end a day. I remember trying to take a finance class in college and I actually dropped it, I think three days into it because I just did not understand it. And as I digress, not really. I would say a lot of the tools I learned on entrepreneurship really help with financing, but even then I'm not the expert at it. Also, I do think for research and development, being too close to the finances can really limit your innovation. Yet it's kind of a balance because if you have too much innovative mind and you get choked out by the finance and the numbers, you just can't innovate. So I think what I'm trying to get to is that understanding your numbers, understanding money, understanding finances to a point where you can use it as a tool to innovate, I think is really important. I think understand the guardrails of money and understand the guardrails of innovating and why we innovate and how innovation pushes forward is really important.
Podcast Interviewer
As a professional.
Adam Yee
Personally, I love personal finance. I'm I would say I'm quite good at it. I find it a really awesome game where you balance risk and reward and you hedge your risks and you bet on things that aren't reckless, like, I don't know, index funds or tech stocks. And I think that the benefit is that there is a certain number known as your net worth that goes up or down. I find that super fascinating and I am trying to apply this to my consultancy, Umay Works, and it's been really fun. I think managing the numbers is really fun for me and in my opinion I want to understand it a little bit more. Would I ever want to be like a cpa? No, I would not. I love what I do. But I do think having just an awareness about the numbers really does help in all aspects of your career. And even in academia, like, or I'm kind of like dabbling my toes in like a lot of, a lot of things we do is based off of kind of money. And you know, it's hard because grants give you so little money and you get paid so little in academia, but the whole kind of project relies on finances in a sense and the innovation you do, eventually it goes down a way where it gets vetted if it's financially viable. And I think just having the background understanding of like why things cost the way they do in innovation, specifically food innovation, I think is just really something to think about. Anyways, the main reason why I brought Abby on the show is to give you just an understanding of how complex this can be, but also really touched on the point that knowing your numbers in anything you do is very important in your life. Thank you for listening to my Food Job Rocks podcast. If you like this podcast, give us a five star review on Apple Podcasts or Spotify. On the Startup CBG's podcast R& D Radio featuring me, I interview Monty Ammons who does this cool consultancy for beverages and he calls it Liquid Sherpas. And I think it's, he's, he's, he's a, you know, gray hair guy, full of wisdom. Really enjoy talking to him and, and dabbling on a few, few kind of hot topics from product briefs to AI. And you can listen to this podcast as. Search up wherever you find podcast. Startup CPG is a lot more popular than this podcast and listen to the latest episode or maybe scroll a few times. I mean they post like every single day. Thank you for the Spoon Network for housing this podcast and we'll see you next week for an exciting episode with another food professional.
Abby June Richards
If you enjoyed this episode. Why not share it with a friend? And don't forget to give us a five star review. You'll find more content like this on the Spoon Tech podcasts.
Host: Adam Yee
Guest: Abby June Richards, CPA, Fractional CFO and Founder of The CPG CFO
Release Date: May 12, 2026
In this episode, Adam Yee sits down with Abby June Richards, a seasoned CPA and fractional CFO who specializes in helping consumer packaged goods (CPG) brands get a handle on their finances. The discussion revolves around demystifying financial models, understanding the difference between accounting and finance, essential metrics for food businesses, effective pricing strategies, and actionable insights for founders unsure where to begin with financial management. Abby’s clarity and candid, supportive style make this a must-listen for anyone in the CPG world who feels overwhelmed by “the numbers.”
(33:37) Brands seek Abby’s help when:
Legal note: CPAs must avoid referring to their services as “audits” unless it’s a regulated, formal audit.
This episode strikes a balance between candid realism and empowering advice, delivered with warmth and practical encouragement. Abby’s accessible explanations take the fear out of financial jargon, while her real-world stories and frameworks give listeners structure for action. Adam’s open acknowledgment of his own finance journey makes the episode especially accessible for founders and operators “learning as they go.”
In Abby’s words:
"If you don’t have the margin, you don’t have a business." (24:34)
For more episodes or questions, visit myfoodjobrocks.com or connect with Adam and Abby on LinkedIn.