Private Label Strategy

EIGHT

Produce Private Labels for Greater Profits

Buyers and sellers at Private Label Manufacturers Association trade show: 10,000

IN THE FACE of increasing private label share in the marketplace and idle capacity in their production facilities, brand manufacturers are tempted to become private label producers. There are two alternative strategies for manufacturers to pursue with respect to private label production: first, a dual strategy, where the firm manufactures both its own manufacturer brands and private labels for retailers. Alternatively, the manufacturer can become a dedicated private label producer.

Dual Strategy

Private label production by brand manufacturers is a ubiquitous phenomenon. In the U.S. alone, it has been estimated that ...