Private/white label brands are products sold by a retailer with its own packing, but manufactured by a third party. Say Frisco sells ordinary branded items, such as Smith’s Beans & Rice, but they also sell their own under the name of ‘Frisco Value Beans & Rice’. Frisco will license a manufacturer to produce baked beans and then sell the product with it’s own label.
The big advantage of private label brands is that they do not include specific marketing costs; also, if a supermarket has an exclusive deal, average transport costs can be lower and they can benefit from distributional economies of scale. Because of the lower costs, the supermarket can sell the product at a lower price, but also gain a bigger profit margin.
With white label brands a manufacturer distributes a product to multiple suppliers who resell it under their name brand, but little beyond the name distinguishes the product. A private label is exclusive to that specific distributor, or retailer.
Private label brands have grown in popularity in recent years, suggesting consumers are becoming more sensitive to price and less loyal to their favourite brands. Supermarkets, such as Aldi and Lidl have made significant strides through the promotion of their own private label products. Consumers are sensitive to price so the appeal of quality in a “lesser,” hyped label is appealing to their shopping budget. More consumers are aware of the fact that the same companies often make both ‘expensive’ brand names and the less expensive private label; this change in consumer preferences could mean the growth of own brand / private label could continue.
A major contact lens solution has marketed its name brand product under a big box store brand name for years. Consumers realize considerable savings and do not sacrifice quality.
Helping consumers realize a quality product regardless of the label is something Century Printing & Packaging has been engaged in for several years. We recognize the need to produce a high quality label without compromising product quality, taste, performance or delivery.
We have a lot of experience with prive/white label business and welcome the opportunity to discuss what we can provide for manufacturers and their label needs.
Ben Waldrop, President
Century Printing & Packaging