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Tops Down Financial Models

Welcome to The Dish, the only newsletter that simplifies finance for CPG people.

Today we’re doing a deep dive on financial models. Get your silverware ready—this one’s going to be delicious.

The Main Course

Building a financial model should be done by every company. I have built over 100 models supporting early and mid stage companies and have learned a lot along the way. As you think about constructing one for budgetary planning or preparing for a capital raise, I want to share some tips with you.


Start with a tops down approach. The other day I met with a beverage client and built the below. It was a brand focused on selling in the natural channel, and after our introductory call, where I learned about their vision and go to market strategy, I put together the below.

Now let’s start off with the thinking behind every assumption.

Wholesale Price

The product is going to sell for $2.99 on the shelf. With a 40% retailer margin and 20% distributor margin (mix of KEHE/UNFI at 15% and then DSD at 25%) the calculation is as follows to determine wholesale price:

$2.99*(1-40%)*(1-20%) = $1.435

For simplicity, I rounded up to $1.45 which will be the price I will use for all 5 years. While pricing can come down overtime as COGS become lower, I never want to change the wholesale price in the model as trade spend can reduce cost to the consumer, making price a variable that remains constant.


The natural / specialty door set is very small compared to conventional grocery and the convenience channel. With a naturally focused product, I typically take a narrow and deep approach within a region and then expand out from there unless you kick it off with a WFM nationwide launch. After 18 months of penetrating the natural channel, I like to enter my way into Conventional (Think Kroger, Albertstons, Jewel Osco) and then Mass (Target and Walmart). Eventually I model in some Club, but I like to keep the revenue to be around 10-15% of total revenue so the model isn’t heavily driven by this channel.

Average SKUs Per Door

Most beverage brands launch with 4 SKUS and the retailers will take in between 2-4. Overtime, as your brand gets some traction, additional SKUs can be launched during the category reset periods.

Velocity Per SKU

Most beverages around the $2.99 price point have to move a half a 12 pack case per week per SKU. This usually doesn’t happen out of the gate across all doors, so I like to gradually get there. For a natural product, your velocity will most likely be stronger in those doors than in other channels. For a tops-down view, I kept my chart a general average.


The 4 assumptions outlined when multiplied together and then by 52 weeks, will result in a tops down revenue build. From here, you can factor in innovation to occur in the future and Wahaaaalaaaaa, you have now built yourself a tops down revenue build.

This is one of many writeups that I plan on doing around financial modeling. Stay tuned for a deeper dive on different financial aspects of your business as well as key ways to scale and grow.


For a natural focused product, I like to build door count to ~10k

For a mainstream beverage , I like to build door count to ~20-30k

For revenue in natural, I target $30-50M and $50M+ for beverage

Thanks for reading through today’s Dish.

Have a great week.

— Adam Siskin

When you’re ready, here are two ways SilverCrest Solutions can help you:

1. Fractional CFO Services

Our CFO playbook has allowed many CPG brands to scale and grow effectively. From financial modeling to reporting analytics, we have setup a system to help you scale with confidence.

2. Sales Analytics and Deduction Management

Our analytics platform, Dash CPG, allows you to visualize all your sales data. From Quickbooks to distributors and retailers, we cover it all.

We also provide deduction management for KEHE and UNFI. Partner with us and protect your gross margins!