A note from our CEO

Hey friends, 

Tariffs. You’ve without a doubt witness the whiplash of worldwide tariffs in the last week and the market turmoil that has ensued. We shared our perspective on tariffs for CPG eCommerce companies in February, but we wanted to share our latest perspective and observations.

1) The three biggest trading partners with the US are Mexico, Canada, and China, in that order. They all still have substantial tariffs from the original rounds in February. Tariffs are here to stay - even excitement around last week’s pause overshadowed the severe impact the China tariffs have and will continue to have. Consumer goods are having to dramatically alter their strategy in how they produce goods.

2) Brands are reshuffling their supply chains. Almost every brand - even “made in USA” brands - have exposure to imports, whether it is supplement raw materials, packaging and labeling, or finished goods. So building a parallel supply chain with alternate sourcing is a project most brands are undertaking at the moment.

3) Brands are testing new ways to increase prices. Many eComm retailers have started adding a “liberation tariff fee” at checkout. Raising prices won’t be trivial - we’ve heard conversations with retailers have been challenging. And the ensuing price matching across platforms will remain complex.

4) It’s becoming difficult to long term plan, or test innovation. We’ve heard brands a year into sourcing with China scrapping their plans. And certain ingredients that felt safe (e.g., European food ingredients) all of a sudden are at risk

Click here to see our last post where we talked about how % tariffs will impact bottom line and the necessary price changes. In 100%+ tariff territory, CPG brands will have their entire margin wiped out unless they make 30-50%+ price increases.

In this month’s newsletter, you’ll find:

• Last month’s sales and ad spend index for our portfolio

• The real hidden costs of Amazon placement fees

• Amazon’s latest search data and what it tells us

As always, if you’ve got questions, hot takes, or trends you're seeing in the wild, reply here; this goes straight to my inbox.

And if you like what you’re reading, pass it on to a founder or operator who’d find it helpful.

Best regards,
Chris

Last Month’s Sales and Ad Spend Numbers

Understanding Amazon’s Placement Fees (and How to Outsmart Them)

Amazon’s placement fees hit the market in 2024 and added cost across most brand’s supply chain. While most brands have probably developed a workflow to minimize these costs, present strategies might mask a much bigger issue: delayed sales and hidden margin erosion. When you pay to consolidate shipments, your inventory is routed through national cross-docks (nIXDs), adding 2–3 weeks before it becomes Prime-eligible. That lag quietly eats into velocity, conversion, and ROIC — especially on high-turn SKUs.

The better path? Shift to Post-Pack + LTL/FTL. If you're shipping 5+ pallets, Post-Pack nearly guarantees $0 placement fees, faster check-ins via regional cross-docks (rIXDs), and more flexible packaging requirements. This workflow alone can unlock thousands in savings per shipment and dramatically improve cash conversion by getting products live faster.

One quiet killer to watch: low-quantity SKUs in Pre-Pack. Just one SKU with fewer than 5 units can trigger placement fees across your entire batch. Splitting those off into separate plans is a simple move that protects your economics. The bottom line: smarter workflows = faster sales, fewer fees, and tighter control over your unit economics.

You can read the full article on placement fee strategies by James McConnell here: marketplaceprep.com/placement-fees

March Search Term Trends on Amazon

Each month, we track and analyze search volume and CPCs for popular Amazon search terms. Here are some recent trends we found interesting.