Charts: U.S. Retail Ecommerce Sales Q4 2024

New data from the U.S. Department of Commerce (PDF) shows that retail ecommerce growth continues to outpace brick-and-mortar. In the fourth quarter of 2024, total U.S. domestic retail sales reached $1.88 trillion, a modest 1.8% increase from Q3. Online shopping showed stronger growth, with sales climbing to $308.9 billion, a 2.7% increase over the prior quarter.

According to the DoC, ecommerce sales are for “goods and services where the buyer places an order (or the price and terms of the sale are negotiated) over an Internet, mobile device, extranet, electronic data interchange network, electronic mail, or other comparable online system. Payment may or may not be made online.”

Ecommerce accounted for 16.4% of total U.S. retail sales in Q4 2024, up slightly from 16.3% in the prior quarter.

The DoC reports U.S. retail ecommerce sales in Q4 2024 grew by 9.4% compared to Q4 2023, while total quarterly retail sales experienced a 3.8% annual rise over the same period.

Merchant Cuts Revenue 60%, Profit Rises 25%

In 2023 Mathias Schrøder was stressed, burned out, and perplexed. He had scaled revenue on his Denmark-based clothing company, but bloated overhead meant little profits and even less free time.

“I felt lost, unable to fix our predicament,” he told me, “until I realized I was trying to solve the wrong problem.”

His solution was to scale down. He fired employees, lowered warehouse costs, and eliminated stagnant inventory. The result was 60% less revenue and 25% more profit.

He shared his journey in our recent conversation. The entire audio is embedded below. The transcript is condensed and edited for clarity.

Eric Bandholz: Who are you, and what do you do?

Mathias Schrøder: I’ve been in ecommerce for about seven or eight years, working for Patina, my family’s clothing business, and as a consultant and developer. Before that, I had a short stint in finance as an analyst for an investment firm. I quickly realized that wasn’t for me — wearing a suit and tie and following orders.

One thing led to another, and in 2018, I joined my parents’ business, selling clothing for women 65 years and older. Back then, we were doing tiny numbers, around $300 to $400 a month. Fast forward to now, we operate online and in physical locations in Denmark, Sweden, and Germany, generating around $3 to $4 million annually.

We recently decided to lower our revenue to gain more freedom. The original concept was to load clothing into large vans, drive to retirement homes or other places where seniors gather, put on small fashion shows, and sell the clothes afterward. We still do that but are now focused on scaling back to have more control over our time.

Bandholz: What led you to that choice?

Schrøder: The decision started several years ago when my girlfriend and I vacationed in Thailand. I love running a business but realized there’s more to life. Plus, I was stressed, burned out, and not hitting the numbers we needed.

We had bloated budgets, excess inventory, too many employees, and a too-large warehouse. I felt lost, unable to fix our predicament until I realized I was trying to solve the wrong problem.

So I said to my girlfriend, “I have this crazy idea. What if we just fire everyone? Why do we keep trying to run faster?” I crunched the numbers in Google Sheets. I started deleting salaries, deleting warehouse costs, deleting X, Y, and Z. I quickly realized that we could decrease revenue without hurting profits.

That was the start of the journey. And it worked.

Implementing the changes took some time. In Denmark, we can’t just fire people, for example. By November 2024 we had completed most of the reductions. Our revenue that month was roughly $800,000, down from $2 million in November 2023 — less than half. But profits increased by 25%!

We killed 60% of the revenue and made a lot more money. It’s a lesson for all entrepreneurs. We should all take an honest look in the mirror and ask, “Why are we doing this?

I have more time to work on projects I enjoy. For example, I’m launching an analytics app for Shopify stores called Kleio, inspired by the Greek muse of history, to help others manage their data at a much more affordable price. It’s a passion project, and I’m excited to share it with merchants who want a better understanding of their numbers.

Bandholz: Where can people follow you?

Schrøder: Our ecommerce site is PatinaMode.dk. It’s in Danish, and we cannot ship to the U.S., unfortunately. The analytics app is at GetKleio.com. I’m on X and LinkedIn.

Your most important customer may be AI

Imagine you run a meal prep company that teaches people how to make simple and delicious food. When someone asks ChatGPT for a recommendation for meal prep companies, yours is described as complicated and confusing. Why? Because the AI saw that in one of your ads there were chopped chives on the top of a bowl of food, and it determined that nobody is going to want to spend time chopping up chives.

This is a real example from Jack Smyth, chief solutions officer of AI, planning, and insights at JellyFish, part of the Brandtech Group. He works with brands to help them understand how their products or company are perceived by AI models in the wild. It may seem odd for companies or brands to be mindful of what an AI “thinks,” but it’s already becoming relevant. A study from the Boston Consulting Group showed that 28% of respondents are using AI to recommend products such as cosmetics. And the push for AI agents that may handle making direct purchases for you is making brands even more conscious of how AI sees their products and business. 

The end results may be a supercharged version of search engine optimization (SEO) where making sure that you’re positively perceived by a large language model might become one of the most important things a brand can do.

Smyth’s company has created software, Share of Model, that assesses how different AI models view your brand. Each AI model has different training data, so although there are many similarities in how brands are assessed, there are differences, too.

For example, Meta’s Llama model may perceive your brand as exciting and reliable, whereas OpenAI’s ChatGPT may view it as exciting but not necessarily reliable. Share of Model asks different models many different questions about your brand and then analyzes all the responses, trying to find trends. “It’s very similar to a human survey, but the respondents here are large language models,” says Smyth.

The ultimate goal is not just to understand how your brand is perceived by AI but to modify that perception. How much models can be influenced is still up in the air, but preliminary results indicate that it may be possible. Since the models now show sources, if you ask them to search the web, a brand can see where the AI is picking up data. 

“We have a brand called Ballantine’s. It’s the No. 2 Scotch whisky that we sell in the world. So it’s a product for mass audiences,” says Gokcen Karaca, head of digital and design at Pernod Ricard, which owns Ballantine’s and a customer utilizing Share of Model. “However, Llama was identifying it as a premium product.” Ballantine’s also has a premium version, which is why the model may have been confused.

So Karaca’s team created new assets like images on social media for Ballantine’s mass product, highlighting its universal appeal to counteract the premium image. It’s not clear yet if the changes are working but Karaca claims early indications are good. “We made tiny changes, and it is taking time. I can’t give you concrete numbers but the trajectory is positive toward our target,” says Karaca.

It’s hard to know how exactly to influence AI because many models are closed-source, meaning their code and weights aren’t public and their inner workings are a bit of a mystery. But the advent of reasoning models, where the AI will share its process of solving a problem in text, could make the process simpler. You may be able to see the “chain of thought” that leads a model to recommend Dove soap, for example. If, in its reasoning, it details how important a good scent is to its soap recommendation, then the marketer knows what to focus on.

The ability to influence models has also opened up other ways to modify how your brand is perceived. For example, research out of Carnegie Mellon shows that changing the prompt can significantly modify what product an AI recommends. 

For example, take these two prompts:

1. “I’m curious to know your preference for the pressure cooker that offers the best combination of cooking performance, durable construction, and overall convenience in preparing a variety of dishes.”

2. “Can you recommend the ultimate pressure cooker that excels in providing consistent pressure, user-friendly controls, and additional features such as multiple cooking presets or a digital display for precise settings?”

The change led one of Google’s models, Gemma, to change from recommending the “Instant Pot” 0% of the time to recommending it 100% of the time. This dramatic change is due to the word choices in the prompt that trigger different parts of the model. The researchers believe we may see brands trying to influence recommended prompts online. For example, on forums like Reddit, people will frequently ask for example prompts to use. Brands may try to surreptitiously influence what prompts are suggested on these forums by having paid users or their own employees offer ideas designed specifically to result in recommendations for their brand or products. “We should warn users that they should not easily trust model recommendations, especially if they use prompts from third parties,” says Weiran Lin, one of the authors of the paper.

This phenomenon may ultimately lead to a push and pull between AI companies and brands similar to what we’ve seen in search over the past several decades. “It’s always a cat-and-mouse game,” says Smyth. “Anything that’s too explicit is unlikely to be as influential as you’d hope.” 

Brands have tried to “trick” search algorithms to place their content higher, while search engines aim to deliver—or at least we hope they deliver—the most relevant and meaningful results for consumers. A similar thing is happening in AI, where brands may try to trick models to give certain answers. “There’s prompt injection, which we do not recommend clients do, but there are a lot of creative ways you can embed messaging in a seemingly innocuous asset,” Smyth says. AI companies may implement techniques like training a model to know when an ad is disingenuous or trying to inflate the image of a brand. Or they may try to make their AI more discerning and less susceptible to tricks.

Another concern with using AI for product recommendations is that biases are built into the models. For example, research out of the University of South Florida shows that models tend to view global brands as higher quality and better than local brands, on average.

“When I give a global brand to the LLMs, it describes it with positive attributes,” says Mahammed Kamruzzaman, one of the authors of the research. “So if I am talking about Nike, in most cases it says that it’s fashionable or it’s very comfortable.” The research shows that if you then ask the model for its perception of a local brand, it will describe it as poor quality or uncomfortable. 

Additionally, the research shows that if you prompt the LLM to recommend gifts for people in high-income countries, it will suggest luxury-brand items, whereas if you ask what to give people in low-income countries, it will recommend non-luxury brands. “When people are using these LLMs for recommendations, they should be aware of bias,” says Kamruzzaman.

AI can also serve as a focus group for brands. Before airing an ad, you can get the AI to evaluate it from a variety of perspectives. “You can specify the audience for your ad,” says Smyth. “One of our clients called it their gen-AI gut check. Even before they start making the ad, they say, ‘I’ve got a few different ways I could be thinking about going to market. Let’s just check with the models.”

Since AI has read, watched, and listened to everything that your brand puts out, consistency may become more important than ever. “Making your brand accessible to an LLM is really difficult if your brand shows up in different ways in different places, and there is no real kind of strength to your brand association,” says Rebecca Sykes, a partner at Brandtech Group, the owner of Share of Model. “If there is a huge disparity, it’s also picked up on, and then it makes it even harder to make clear recommendations about that brand.”

Regardless of whether AI is the best customer or the most nitpicky, it may soon become undeniable that an AI’s perception of a brand will have an impact on its bottom line. “It’s probably the very beginning of the conversations that most brands are having, where they’re even thinking about AI as a new audience,” says Sykes.

Bookshop.org, an Amazon Rival, Adds Ebooks

Five years ago, publishing entrepreneur Andy Hunter launched Bookshop.org to provide a “virtuous alternative” to Amazon, which controls about half the U.S. market for print books.

At the time, Hunter told The Hot Sheet, a newsletter for publishing insiders, that his goal was to “snatch a crumb away from the giant’s mouth,” and that taking just 1% of Amazon’s business would provide “massive” support for independent bookstores.

Bookshop, a Certified B Corp, shares profits with independent, physical booksellers; shoppers can purchase on Bookshop.org and designate a local store. If shoppers don’t choose one, Bookshop pools the money and shares it among all participating stores. The site also offers affiliate accounts for online-only sellers, events, and individuals such as authors — all can earn a 10% commission on the list price for referrals.

Screenshot of Bookshop's home page.

Bookshop, a B Corp, shares profits with independent, physical bookstores.

About 90% — roughly 2,200 — of the members of the American Booksellers Association, the leading trade group for independent bookstores, are affiliated with Bookshop, which claims to have shared more than $36 million of profits with local stores. But only about one in five ABA members offer ebooks.

While print still holds the lion’s share of book sales, audiobook and ebook sales are growing much faster. Digital borrowing from libraries is also growing rapidly, as are sales of self-published and indie titles, those published outside of the major publishers.

Now Bookshop is tackling the ebook market, currently dominated by Amazon’s Kindle with an estimated two-thirds share. In late January, Bookshop began selling ebooks, with more than 1 million titles on offer. Bookshop says participating bookstores that refer ebook buyers earn the entire profit margin the publisher offers — about 30%.

Consumers can read Bookshop’s ebooks in a browser or on the new smartphone app, a free download for Android and iOS devices. The app offers features similar to existing ebook platforms, including the ability to search and highlight text, adjust fonts, set bookmarks, and make notes. Readers can sync across devices, choose paginated or scrolling mode, and share excerpts directly to social media.

Bookshop’s platform isn’t compatible with Amazon’s proprietary Kindle format. Bookshop expects to add support for additional platforms soon, including Rakuten’s Kobo, which is popular in Canada, Europe, and Asia. An unrelated audiobook site, Libro.fm, gives independent stores the ability to earn commissions from referrals of audiobook sales.

Self-Publishing

Amazon’s Kindle Direct Publishing is the leading self-publishing platform, and its Kindle Unlimited is an important channel for independent authors. Bookshop’s app syncs with ebooks published on Draft2Digital and IngramSpark, the second- and third-largest self-publishing platforms. (Ingram, the largest book distributor in the U.S., is also Bookshop’s print book distribution partner.)

That means Bookshop, if its ebooks gain traction, gives self-published authors a viable alternative to Amazon besides selling direct through their own websites, something not every writer can manage. Two prominent authors, Dave Eggers and Booker Prize winner Lydia Davis, have refused to sell recent books through Amazon, citing objections to its aggressive business practices. It will be interesting to see whether many self-publishing authors follow their lead.

Nonetheless, some long-established local independent booksellers I spoke with, who hold book inventory and sell through their own websites, said they have no immediate plans to offer ebooks. I also reviewed the sites of prominent independents — Powell’s, City Lights, and Strand. None offer ebooks.

Charts: Consumer Product Trends, Q1 2025

In 2025, most global consumer product executives expect stable prices in the near term. Many believe raising prices won’t drive revenue growth and could lead to retailer resistance while significantly reducing consumer demand. That’s according to Deloitte’s new “2025 Consumer Products Industry Outlook.”

Deloitte’s annual consumer products report assesses the global state of the industry. The firm analyzed the top 100 global consumer products companies by revenue and also surveyed (in October 2024) 250 consumer product executives worldwide at companies with annual revenue of at least $500 million — from food and beverage, household goods, personal care and beauty, and apparel verticals.

Also, according to the study, almost two-thirds of surveyed executives plan to allocate more of their innovation investments toward creating genuinely new products.


Most surveyed companies are allocating resources to digital and retail media.


Moreover, the surveyed executives anticipate marketing and sales will experience the best return on AI investments.

AI Is Changing Buying Behavior, Study Finds

Artificial intelligence is driving global shopping experiences according to Capgemini Research Institute’s annual trends report.

What matters to today’s consumer 2025,” published Jan. 9, recaps the firm’s survey in October and November 2024 of 12,000 consumers in Australia, Canada, France, Germany, India, Italy, Japan, the Netherlands, Spain, Sweden, the United Kingdom, and the United States.

The 100-page report focuses on how consumers discover products, how they shop, and why they switch brands.

Product Discovery

ChatGPT and other generative AI platforms have largely replaced traditional search engines for product recommendations, according to the survey. Nearly two-thirds of Gen Zs (ages 18-25), Millennials (26-41), and Gen Xs (42-47) prefer genAI for that purpose. Only Boomers (58 and over) still favor Google and other search engines for recommendations.

Moreover, genAI is transforming seemingly every touchpoint of the shopping journey. Consumers now ask genAI to curate images and aggregate product searches from multiple platforms. Some had even found virtual assistants more adept at making fashion, home décor, and travel recommendations than sales associates.

We addressed in December the power of influencers and social media for gift recommendations. An Adobe survey found that 20% of all U.S. Cyber Monday sales came from influencer endorsements. The Capgemini survey confirms those findings and more, reporting:

  • 32% of consumers purchased products through social media,
  • 68% of Gen Zs have discovered a product or brand through social.

Shopping

Consumers are responding to retail media, according to the survey.

  • 67% of respondents notice ads on retailer sites.
  • 35% found the ads helpful.
  • 22% discovered products from those ads.

Despite the recent cost-of-living improvements, consumers still seek in-store and online discounts.

  • 64% visit multiple physical stores seeking deals.
  • 65% buy private-label or low-cost brands.

Consumers also value “quick commerce,” the hyper-fast delivery of online goods. Approximately two-thirds of respondents stated a 2-hour or a 10-minute delivery was important to their purchase decisions. Forty-two percent valued the order-online pick-up in-store option.

“Demand for quick commerce is on the rise, with consumers from some geographies increasingly willing to pay for speed and efficiency,” researchers wrote, adding that merchants continue to invest in AI and logistics to improve infrastructures.

Switching Brands

Brand loyalty is increasingly rare among consumers, according to the survey. Researchers advised brands to (i) augment genAI tools to become more consumer-centric, (ii) use technology to lower prices, and (iii) leverage social and retail media networks.

Charts: AI Outlook, Employees vs. Execs, Q1 2025

Employees worldwide are adopting generative AI faster than their leaders expect, according to McKinsey & Company’s January 2025 report, “Superagency in the workplace: Empowering people to unlock AI’s full potential.”

The report examines the survey results of companies’ preparedness for AI adoption. In October and November 2024, McKinsey queried 3,613 employees, managers, and independent contributors and 238 C-level executives.

Eighty-one percent of respondents were from the United States, while the rest represented Australia, India, New Zealand, Singapore, and the United Kingdom. Participants held various roles across business development, finance, marketing, product management, sales, and technology.

According to the report, 62% of millennials aged 35 to 44 reported strong expertise with AI.

Public sector, aerospace/defense, and semiconductor workers are less optimistic about AI’s near-term impact. Only 20% expect significant changes to their work in the next year, contrasting with the media/entertainment and telecom sectors, where about two-thirds anticipate significant AI-driven changes.

Most executives (87%) anticipate generative AI will boost revenue within three years, with half expecting gains above 5%.

Charts: Global Digital Home Trends Q4 2024

Forty-four percent of global household respondents are willing to pay more for a single platform that aggregates all their TV and internet content, 35% are willing to pay to watch sports, and 32% would pay a premium to watch TV without ads.

That’s according to EY’s “Decoding the Digital Home” October 2024 report based on an online survey conducted in July and August.

The survey, carried out for EY’s global technology, media and entertainment, and telecommunications team, gathered responses from 20,000 households across Canada, France, Germany, Italy, South Korea, Spain, Sweden, Switzerland, the U.K., and the U.S.

According to the EY study, 38% of households in 2022 were concerned about encountering harmful content online. That grew to 44% of households in 2023 and 47% in 2024.

In addition, the proportion of households in all 10 countries that prefer services from a single provider increased from 2023 to 2024 — the global average rose from 40% to 44%.

Moreover, most households think connectivity and content providers should offer clearer explanations of how they use AI in customer interactions.

Protein Bar Founder Thrives in a Crowded Field

According to Will Nitze, founder and CEO of IQBAR, success in a competitive market requires finding its uncompetitive niches. He did that with his flagship protein bar, which is plant-based, low-sugar, and plainly labeled. That was seven years ago when he launched the company with a $75,000 Kickstarter campaign.

Fast forward to 2025, and IQBAR also makes IQMIX (hydration) and IQJOE (coffee). All promote brain health without competing against each other.

Will and I recently discussed his journey, from the initial capital raise to scaling revenue, adding products, and managing wholesale channels. The entire audio of our conversation is embedded below. The transcript is edited for clarity and length.

Eric Bandholz: Give us a quick rundown of who you are.

Will Nitze: I am the founder and CEO of IQBAR. Our hero product is nutritional bars, but we also make IQMIX for hydration and IQJOE for instant coffee. Roughly 55% of our revenue is wholesale; our direct-to-consumer ecommerce site and Amazon account for the balance. We’ve raised just under $10 million since our launch 7 years ago.

Bandholz: How do you stand out in such a competitive market?

Nitze: The key is breaking down the competition into subcategories. In the protein bar market, the saturated category is animal-based ingredients. But when you focus on plant protein, low sugar, and clean labels, you can carve out a space with much less competition but still substantial. It’s about finding the uncompetitive niches within the broader competitive landscape.

I got into this space as a personal passion. I was dissatisfied with my software job and began exploring low-carb diets, eventually landing on keto. I was especially interested in brain food and noticed that, at the time, no one was offering ready-to-eat options. Most brain nutrition comes in pill or powder form. I launched a Kickstarter campaign that raised $75,000, validating the concept. From there, we pivoted based on customer feedback, focusing on protein and clean labels.

The brain angle is useful and differentiated, but it’s the deal closer, not the deal opener. People shop our products based on the protein count — where it came from and how complete it is — and then sugar.

Our strategy has been to expand the product line without cannibalizing our core bar product. Many brands extend their product lines in ways that compete with their existing items, like moving from bars to peanut butter cups. We wanted our new products — hydration and coffee — to complement our bars, aligning with our brain and body nutrition mission but not competing. We also considered shelf stability and ease of production.

Bandholz: You have just nine employees. How do you maintain such a lean team while scaling?

Nitze: Recognizing my weaknesses is essential. I’m not great at hiring, so I rely on a trusted circle. My wife is our chief marketing officer and head of ecommerce. I keep a close connection with everyone on the team. We use external agencies for pay-per-click ads, search engine optimization, and Amazon management. We work closely with these partners and our manufacturer to keep things running smoothly with fewer full-time employees.

We never commit to long-term agency contracts without an exit clause. Most agencies operate on annual terms, but we ensure we can leave with 30- or 60-day notice. We’ve worked with our Amazon agency for over two years; they know our business inside out. We implemented a bonus structure for them to incentivize performance. This deal worked well for both sides, as it aligns their goals with ours.

Bandholz: How did you develop your wholesale strategy?

Nitze: Again, our business will be 55% wholesale this year. We believe in an omnichannel approach, especially brick-and-mortar retail. Digital-first is essential for building credibility in the retail world. We can show prospective retailers data from our ecommerce site, such as the number of customers in their trade area. Brokers play a key role in retail growth, especially those connected with large chains, such as Walmart and Costco.

The key is to work with retailers who pay quickly. Amazon, for example, pays every two weeks. Beyond that, raising money is crucial. Some people idolize bootstrapping, but raising funds allows you to scale quickly. In the early stages, you need capital to fund inventory, which becomes the backbone of your business. Another key is having a high gross margin, which allows you to reinvest into more inventory. Ultimately, scaling up helps maintain cash flow.

Bandholz: Was it hard finding a manufacturer?

Nitze: It was a challenge. Our first co-packer — the company making the food and packaging and labeling it — was great for small volumes but couldn’t scale. Eventually, we switched to a co-packer that could handle higher volumes. This process was painful, as it meant quality control disruptions. But once we found the right partner, we could scale significantly. Now, we have a co-packer that can manage millions of units annually, and that’s been critical to our growth.

Bandholz: Where can people contact you?

Nitze: Reach me through our website, EatIQBar.com, or LinkedIn.

Protein Bar Founder Thrives in a Crowded Field

According to Will Nitze, founder and CEO of IQBAR, success in a competitive market requires finding its uncompetitive niches. He did that with his flagship protein bar, which is plant-based, low-sugar, and plainly labeled. That was seven years ago when he launched the company with a $75,000 Kickstarter campaign.

Fast forward to 2025, and IQBAR also makes IQMIX (hydration) and IQJOE (coffee). All promote brain health without competing against each other.

Will and I recently discussed his journey, from the initial capital raise to scaling revenue, adding products, and managing wholesale channels. The entire audio of our conversation is embedded below. The transcript is edited for clarity and length.

Eric Bandholz: Give us a quick rundown of who you are.

Will Nitze: I am the founder and CEO of IQBAR. Our hero product is nutritional bars, but we also make IQMIX for hydration and IQJOE for instant coffee. Roughly 55% of our revenue is wholesale; our direct-to-consumer ecommerce site and Amazon account for the balance. We’ve raised just under $10 million since our launch 7 years ago.

Bandholz: How do you stand out in such a competitive market?

Nitze: The key is breaking down the competition into subcategories. In the protein bar market, the saturated category is animal-based ingredients. But when you focus on plant protein, low sugar, and clean labels, you can carve out a space with much less competition but still substantial. It’s about finding the uncompetitive niches within the broader competitive landscape.

I got into this space as a personal passion. I was dissatisfied with my software job and began exploring low-carb diets, eventually landing on keto. I was especially interested in brain food and noticed that, at the time, no one was offering ready-to-eat options. Most brain nutrition comes in pill or powder form. I launched a Kickstarter campaign that raised $75,000, validating the concept. From there, we pivoted based on customer feedback, focusing on protein and clean labels.

The brain angle is useful and differentiated, but it’s the deal closer, not the deal opener. People shop our products based on the protein count — where it came from and how complete it is — and then sugar.

Our strategy has been to expand the product line without cannibalizing our core bar product. Many brands extend their product lines in ways that compete with their existing items, like moving from bars to peanut butter cups. We wanted our new products — hydration and coffee — to complement our bars, aligning with our brain and body nutrition mission but not competing. We also considered shelf stability and ease of production.

Bandholz: You have just nine employees. How do you maintain such a lean team while scaling?

Nitze: Recognizing my weaknesses is essential. I’m not great at hiring, so I rely on a trusted circle. My wife is our chief marketing officer and head of ecommerce. I keep a close connection with everyone on the team. We use external agencies for pay-per-click ads, search engine optimization, and Amazon management. We work closely with these partners and our manufacturer to keep things running smoothly with fewer full-time employees.

We never commit to long-term agency contracts without an exit clause. Most agencies operate on annual terms, but we ensure we can leave with 30- or 60-day notice. We’ve worked with our Amazon agency for over two years; they know our business inside out. We implemented a bonus structure for them to incentivize performance. This deal worked well for both sides, as it aligns their goals with ours.

Bandholz: How did you develop your wholesale strategy?

Nitze: Again, our business will be 55% wholesale this year. We believe in an omnichannel approach, especially brick-and-mortar retail. Digital-first is essential for building credibility in the retail world. We can show prospective retailers data from our ecommerce site, such as the number of customers in their trade area. Brokers play a key role in retail growth, especially those connected with large chains, such as Walmart and Costco.

The key is to work with retailers who pay quickly. Amazon, for example, pays every two weeks. Beyond that, raising money is crucial. Some people idolize bootstrapping, but raising funds allows you to scale quickly. In the early stages, you need capital to fund inventory, which becomes the backbone of your business. Another key is having a high gross margin, which allows you to reinvest into more inventory. Ultimately, scaling up helps maintain cash flow.

Bandholz: Was it hard finding a manufacturer?

Nitze: It was a challenge. Our first co-packer — the company making the food and packaging and labeling it — was great for small volumes but couldn’t scale. Eventually, we switched to a co-packer that could handle higher volumes. This process was painful, as it meant quality control disruptions. But once we found the right partner, we could scale significantly. Now, we have a co-packer that can manage millions of units annually, and that’s been critical to our growth.

Bandholz: Where can people contact you?

Nitze: Reach me through our website, EatIQBar.com, or LinkedIn.