A Practical Guide

How to build a finance function that actually helps your CPG brand grow profitably

If you’ve spent any time on the internet as a founder, you’ve probably been bombarded by self-proclaimed marketing gurus telling you exactly how to scale your brand.

They know where you should source your creative.
They know who you should hire.
They know which agencies to pay and how to allocate every dollar across every channel.
All it takes is a cool $1,000 per month for their course.

So here it is - a real guide to finance for omnichannel consumer brands that actually helps you. Yes, it’s real and no you don’t have to pay for it.

This guide breaks down how to design a finance function that supports growth, profitability, and long-term value creation for brands selling across ecommerce, Amazon, Shopify, TikTok, and more.

We’ll focus on three core ideas:

1. What a great finance function does

2. The key roles and tools to run one well

3. How finance priorities change as your business scales

Let’s start with the most important question.

What Does a Great Finance Function Do?

A best-in-class finance function for a consumer brand accomplishes two things:

1. Instills financial rigor

2. Positions the business to achieve its goals whether that’s aggressive growth or profitability

Everything finance does ladders into one or both of those outcomes.

Instilling Financial Rigor

Financial rigor is not something you've probably heard much about for the last 15+ years.

It's not because financial rigor is not important, but rather that capital markets were so flush with cash that, generally speaking, growing companies could ‘outraise’ their lack of financial discipline. In today’s market, and likely into the foreseeable future, financial rigor is of the utmost importance.

So, what exactly is financial rigor? Really its just discipline. Strong efficiencies, secure operations, robust reporting, and then some. Below are the tasks the finance function performs that accomplish the goal of instilling financial rigor within the organization. 

Cash Management

Cash management is foundational. This means:

• Monitoring cash inflows and outflows

• Maintaining a rolling 13-week cash flow forecast

• Actively managing excess cash instead of letting it rot in a checking account

Short-term instruments like money market funds can generate meaningful incremental income. And as recent market volatility has reminded everyone, deposit security matters.

Financial Reporting

Reporting matters for two reasons:

1. You can’t steer the business if you can’t see what’s happening

2. Investors, lenders, and stakeholders require confidence

Strong, consistent reporting increases trust in management and improves your ability to raise capital when needed. You can’t dodge the iceberg if you’re blindfolded.

Compliance

Tax compliance, especially sales tax , is an area where founders routinely shoot themselves in the foot.

Improper nexus setup or incorrect tax collection can:

• Become a massive cash expense

• Completely derail an acquisition

If a buyer looks under the hood and finds tax issues, it can be catastrophic.

Cost Accounting

This is the bedrock of business.

If you don’t know what something costs, you don’t know if you’re making money. Omnichannel brands often underestimate fees embedded in different platforms and fulfillment structures. Small strategic changes here can dramatically improve margins.

Financial Controls

Controls protect the integrity of the business. A company without them is always exposed to fraud, errors, and operational chaos.

Positioning the Business for Success

We don’t always get a ton of love in the back office, but in reality without us you would be screwed.

Our job as the finance function is not only to keep the wheels on the race car, but it is to give the racecar the most badass wheels and maybe some jet fuel so that the drivers can win the race.

The following are a few examples of how a great finance function can position the company for success in ways no other function can.

Financial Planning & Analysis (FP&A)

FP&A is one of the highest-leverage functions in any business.

A strong FP&A function:

• Produces realistic but ambitious budgets

• Helps marketing understand return on invested capital

• Plans inventory and demand

• Guides decisions on hiring, pricing, and expansion

A financial model may look like a spreadsheet, but it’s really a book full of instructions if you know how to read it.

Business Intelligence

Here is one special thing about the finance function that no other function can claim: we know everything.

• Every number that falls through my QuickBooks

• Every business contract

• Every SaaS price

• Every PO

• Every sale

What this means is that the finance function is uniquely positioned to be the primary source of business intelligence. Only the finance function knows both the trailing 3 month cohort behavior, as well as the upcoming PO planning for inventory.

Sorry to break it to you, marketers. You may be sexy, but you still can’t read a balance sheet (I’m clearly not bothered by the attention marketing teams get).

Business intelligence in Ecom can primarily come from customer behavior analysis, attribution modeling, channel analysis, and more.

Capital Markets

Understanding capital markets is essential if you plan to raise, refinance, or exit.

If you don’t know what’s happening in the market and try to raise anyway, it’s like showing up to Expo West to sell cars without knowing what cars people want. You’ll look clueless and no one will give you money.

But if you can navigate capital markets well, you unlock:

• New growth pathways

• Liquidity options

• Long-term equity value

Brands like Iron & Resin increased margins while growing over 50 percent by leveraging disciplined financial insights and planning with Iris. See their story here.

Key Roles in a Great Finance Function

A strong finance function requires two things: people and software. Let’s start with the people.

CFO

This is your hefe of finance in the organization. Once upon a time, CFO just meant glorified accountant – that doesn’t cut it these days. The modern CFO must be both backward and forward looking. They manage strategy, reporting, treasury, investor relations, and long-term planning.

Controller

The backbone of controls, cost accounting, and reporting.

Accounts Payable & Receivable

At scale, managing working capital requires focus. Bills must get paid and cash must be collected consistently.

Tax Manager

Responsible for compliance and minimizing risk.

Inventory / Demand Planner

Critical for omnichannel brands. Stockouts kill growth, over-investing kills cash flow.

Treasury

Once cash balances grow, leaving money idle becomes irresponsible, especially in a high rate environment.

Investor Relations

Increasingly relevant for private brands with institutional capital.

Essential Finance Software for CPG Brands

Technology enables scale, efficiency, and security. Examples include:

• Accounting: These are the usual suspects. QuickBooks, Xero, NetSuite, Sage, etc. These will help you manage transactions/invoicing/reporting.

• Spend management: Think Rho, Ramp, Divvy, etc. These are mostly credit card providers, but I like Rho because they can also house your deposits, help automate employee expenses, and more

• Tax: Avalara and TaxJar are two popular tax software applications to help you stay compliant.

• Payroll: Gusto, Rippling, ADP, have all basically eliminated the need for manually processing payroll. 

• Equity management: Carta is by far the most popular. I actually don’t even know of another one

• Data rooms: Docsend, Carta, can host secure data rooms for you to add prospective investors too

These are really just a few examples of popular software that may be utilized by a strong finance function. The right software is critical for optimizing for efficiency as well as security.

How Finance Priorities Change as You Scale

$0–$1M: Zero to One

This is foundation building mode.

Priorities:

• Accrual accounting (not cash)

• QuickBooks + a freelance bookkeeper

• Basic tax compliance

• Regular reporting habits

Fixing broken infrastructure after your first million is a nightmare. Set it up right early.

$1–$10M: “This Thing Has Legs”

Once your brand has scaled past the 7-figure mark, there is actually real money sloshing around in on and around what you call your business.

Fail to optimize here, and you will die with the 90% of startups who fail to make it past the 8 figure mark, for failure to raise capital, failure to manage working capital, failure to generate profit, or any other reason.

Generally, if you can get to the $5m mark or higher, your business shouldn’t fail because it’s a ‘bad idea’ or a lack of demand.

Low to mid single digit million dollar businesses are real businesses, it's just a matter of expansion and execution after that.

Priorities:

1. Bookkeeper/controller: This becomes an even more important priority with scale. If you go from $100k per month to $500k per month in revenue, you will have at the very least 5 times the amount of transactions as you did at $100k, if not more. You will also find it more valuable to have a more granular line of sight into your cost accounting. If you cheaped out on the bookkeeper or controller in the last step, do it now or you will forever regret.

2. FP&A: If you can do financial modeling it is time to roll your sleeves up. You will likely build your first real financial model here that you will live and die by. I always say that a financial model looks like a lot of numbers, but in reality it is a book full of words that tells you exactly what to do. Learn to read numbers and your financial model will tell you when to buy more inventory, when to hire more people, when to increase or decrease prices, and so much more.

3. Inventory planning: This is also a smart time to start to really invest into demand planning. Mad Rabbit was on Shark Tank in April 2021, around which time we were doing call it $4m in TTM sales, we had a  terrible OOS situation (granted, we could not have predicted a shark tank impact) we then hired our first head of ops in September 2021 and have never run out of inventory since. It has been absolutely crucial to the triple digit growth we have experienced since then and continue to experience. Being able to generate demand is valuable, being able to capture demand is valuable. Being able to both at the same time is priceless.

4. Fundraising: Usually spearheaded by the CEO, but can and should be augmented by a strong finance function, it is important to have all your ducks in a row. That means a strong bottoms up model, a strong outline of unit economics and their trendlines, clean books, someone who understands market sizing, cap table management, and more.

$10–$100M: To the Moon

At this stage, we are going to assume that everything I have already mentioned in the last 622 words is taken care of – if it hasn’t been, you either didn’t make it here or you are very lucky and your death is imminent.

Priorities:

1. Enhanced visibility / systems optimization. At 8 figure scale, every penny matters. A simple savings of 10 cents on postage can be worth 6 figures. This is about the time where your systems grow up. You can probably get away with scaling to this point without a warehouse management system for your inventory if you are just using Excel, but it's time to grow up. You need a robust FP&A function (software or a talented human), a WMS that works, and at some point, an ERP that can provide you visibility into the most granular areas of your business.

2. CFO. If you don’t already have a co-founder who is financially savvy or you haven’t hired a CFO, I think low to mid 8 figures is usually a good time. Your business will be big enough that the right CFO will be worth their weight in gold.

3. Treasury management. At some point, especially in this interest rate environment, your business will have enough money that it would be stupid not to invest in short term securities that can easily yield you hundreds of thousands of dollars if not millions every year. 

4. M&A. If you are eventually looking to sell your business, you will need to start the process of exit readiness at some point in this bracket. Bankers and consultants and a good CFO can help

5. Reporting. Reporting definitely will become more intense, and you will need to invest resources into generating sufficient reports for all key stakeholders.

6. Investor relations. It is important that your finance function is keeping a pulse on the markets and is making an effort to cultivate genuine relationships with investors, whether you are supported by outside capital or not, it is never a bad idea to have access to capital. One bad liquidity crunch and your $30m business could be selling for pennies to a private equity vulture who is going to take all your equity upside. 

Final Thoughts

A great finance function does two things well:

1. Instills financial rigor

2. Maximizes the company’s ability to make money

In omnichannel CPG, finance is your growth engine.

If you want to scale profitably, raise capital intelligently, and build a durable brand, you need to build your finance foundation now.

Customer stories like how LIVFRESH gained real-time profit intelligence with daily financial insights from Iris show the impact of disciplined finance in action and how brands can power their next stage of growth.