How To Optimize your P&L for 20%+ Profit Margins - ECF Podcast Episode 525

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RockSinCity
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Calling all financial nerds: This week Leo Caracas joins the show to talk about how to optimize your P&L for 20%+ net profit margins.

Leo's been elbow-deep in the trenches as an operator and investor for years, and he’s coached 100+ brands. Here’s what he’s learned:

- Nail your P&L or get nailed. Keep COGS under 30%, ad spend under 25%, shipping under 15%, payroll under 15% for financial viability, growth and good margins.

- Reviews and quality products are your lifeblood. You need at LEAST a 4.6+ star rating on Amazon or you're DOA. Scrape competitor reviews for juicy insights to help improve.

- Product-market fit is EVERYTHING. Killer reviews, 30%+ repurchase rate, $50+ AOV, 3%+ conversion rates are what you should be aiming for to build a high-growth brand.

ecommercefuel.com

[01:23] Introduction
[02:27] Coaching Business
[04:43] Lessons Learned
[05:29] Business Mistakes
[08:36] P&L Structure
[11:40] Drive-through P&L
[12:37] COGS
[15:16] Paid Media
[19:08] Business with 30-35% COGS
[21:05] Shipping Costs
[22:06] Payroll Basics
[23:30] Outsourcing Strategy
[26:56] Business Review
[27:28] Net Profit
[28:53] Max Impact. Min Effort
[31:17] Front Pricing
[32:38] AUV Bundling
[34:19] Content Machines
[35:33] AI Usage
[37:50] Video or Content
[40:18] Content by Payroll
[42:21] Commercial Calendar
[45:12] KPIs
[50:17] Entrepreneurial Defensiveness
[54:42] Octoparse Software
[55:24] Jump Strategy
[57:21] Wrap-up
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