Short transcript excerpt of Matthew Kelly discussing how to innovate in niche functional drinks and the importance of calculating retail gross margins. He emphasizes starting with product-level gross margins (GP1/GP2 equivalents), including shipping, and suggests aiming for high gross margins (ideally 60%+).
About 60% or higher ("60% plus").
How to innovate in niche functional drinks. You can create newness in many, many ways. How do you make retail margins work when they take a big cut and charge big promo fees? Well, how do you make any margins work? You do the maths, right? I think it helps to have. I think the potential success in any consumer business starts with the gross margin, you know, GP1, GP2 kind of different things, right? GP1 being your product margin in isolation. GP2 you know, CM1, CM2 same thing. People call it different shit in the piano, but like basically your product margin in isolation and. Or your product margin including shipping, right? Like your gross margin, you can get away with 50, but ideally 60% plus. And it' probably going to be hard.
