private label

5 Tips for Retailers Starting a Private Label Product Line

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Retail companies introducing their own lines of private label products often face an uphill battle: they are dependent on other manufacturers for their products, and they must establish their private line against major brands.

While “generic” brands once gave off the impression of low quality, this is no longer the case. Private label brands are giving major brands a run for their money on store shelves, but this is only possible if they're positioned correctly. Here are five success tips for retailers that want to start a private label product line.

1. Fill a Unique Need in the Market

Private labels perform best when they bring something different and unique to the market. In other words, retailers should take a close look at the major national brands in the same category and see if there is a need in that space that remains unfulfilled. If there is, this could be a ticket to success.

Some examples are private label foods that have branched into the organic and gluten-free niches. While price is still a differentiator, it's essential to find something unique that will appeal to consumers.

2. Support or Align with a Master Brand

While a product should file a unique need in the market, there's no reason that retailers shouldn't be able to take advantage of strategic partnerships and alliances. Take a look at what Target accomplishes with private label designer brands like Michael Graves, Isaac Mizrahi, and now Vineyard Vines—these brands are consistent with Target's promise of affordability and quality while offering something exclusive to the store's shoppers.

While it may not be easy to get a brand into a store like Target (maybe you can), it doesn't hurt to think along these lines. Is there a retailer in the area that can be approached with a private label and message?

3. Offer High Quality at a Lower Price

In the past, there has been the perception that private labels were of lower quality than national brands. In other words, private label diapers would be less absorbent, and tissues less soft than a national brand.

Fortunately, many of these quality gaps have either narrowed or no longer exist. One of the goals should be to provide the highest quality product possible that will also beat out brand names in a price comparison.

4. Spending Time on Branding

No matter what approach is chosen, it's vital that a good deal of time is spent defining and then positioning a brand. A unique logo and catchy name aren't going to be enough to sustain a business long-term.

It’s important to develop a story that appeals to the target audience and creates effective campaigns to get the message across. Getting a brand in front of its target market is an ongoing process.

5. Using Labeling That Makes an Impression

The look and feel of a product is not something to be left to chance. Partnering with a company that specializes in branding, packaging, and custom labels is critical.

Brand owners only have one chance to make a powerful first impression. How a product is packaged and labeled can make or break a business, particularly in the beginning.

The partnership formed with a custom label provider will play a significant role in the success or failure of the private label product. Even though many will claim to be the best and promise to deliver what is needed, it will come down to due diligence to make the right choice.

Taking special care with labeling choices is key. Retailers should ensure that they are being truthful on the label and complying with all applicable regulations. Beyond this, custom labels should be unique, impactful and memorable so that they stand out from the crowd.

Private labeling is one of the hottest trends in retail, but it's not something that should be approached without a plan. Creating a new product that is exclusive can be profitable, and a business stands the best chance of success by taking a deliberate approach to this process and paying particular attention to branding and labeling.

If your company would like to learn more about the benefits of private labeling, the team at Century Label is happy to help. Contact us now to set up a free quote or answers to any of your questions about private labeling.

How to Choose the Right Private Label Manufacturing Partner

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Going the private label route for food and beverage items is an excellent way to increase margins and expand reach. According to Nielsen and the Private Label Manufacturers Association (PLMA), sales of these products hit $128.6 billion last year, a 4.4% increase over the prior year and a 22.3% increase in unit share.

Choosing a private label manufacturer to create and sell these products with can be difficult. There are plenty of choices, and care must be taken to select the right partner to work with to guarantee mutual success.

Vetting different manufacturers for a private label product can be a tedious and difficult process, but here are some items to keep in mind:

Create a Unique Product

The first step should be to create a unique product. It would be a mistake to send something to market that isn't going to fill a need or create a positive customer experience.

A significant amount of time should be spent on market and product research on the front end so that adjustments don’t need to be made later. Even so, finding a manufacturer that is amenable when changes to the product are needed is key.

Consider Protecting The Design

If the design is truly unique, some steps should be taken to protect it before a private label product launch. This might involve securing a patent.

Something else that can be done to protect a brand is to set clear policies and procedures that define the right priorities. Once manufacturers have these in hand, there won't be excuses for falling short.

Ensure Quality and Timely Delivery

There is a common misconception that private labeling translates to lower quality. This doesn't have to be the case, and companies can help smash these mistaken beliefs by choosing a manufacturer that is going to deliver a quality product and promise timely delivery.

Some of the questions that should be asked of any prospective manufacturer include:

  • What is your average delivery time? 

  • Are there any hidden charges? 

  • How do you ensure ingredient and final product quality? 

  • Does your company offer product storage? 

  • What is your minimum order quantity? 

  • Can you produce a custom formula? 

  • Is someone available for support?

Who to contact to ask these questions depends on the brand owner’s goals. For a domestic manufacturer, directories like MFGThomasNet, and Makers Row are an excellent place to start. For overseas manufacturing, check out sites like AliExpressAlibaba, and IndiaMart.

Secure Graphic Design and Custom Label Services

The look and feel of a product is not something to be left to chance. Partnering with a company that specializes in branding, packaging, and custom labels is critical.

The partnership formed with a custom label provider will play a significant role in the success or failure of the private label product. Even though many will claim to be the best and promise to deliver what is needed, it will come down to due diligence to make the right choice.

If your company would like to learn more about the benefits of private labeling, the team at Century Label is happy to help. Contact us now to set up a free quote or answers to any of your questions about private labeling.

4 Benefits of Private Labeling for Your Brand

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Private labeling occurs in many different industries, from cosmetics and household cleaners to foods. As a product manufacturer, private labeling could be an excellent opportunity for increased profits, decreased competition, and many other advantages.

Commonly referred to as “generic”, they are anything but: private labels compete with brand-name products and are typically sold at lower prices. Private labeling is a common form of merchandising that can generate positive returns on investment for store owners and manufacturers.

What Are Private Labels?

Private labels—or store labels—are exclusive labels that a particular store owns. They are the packaging and brand names specific to a particular store. Examples include Walmart’s “Great Value” Costco’s “Kirkland” brand, and “Private Selection”, available from Kroger.

Manufacturers of goods can sell their items for private labeling in addition to creating their own brands. Kraft, for example, manufactures its products for sale under the Planters Peanuts brand name as well as under private label names. This carries the benefit of marketing a product to larger retailers to sell the product in the retailer’s brand packaging, expanding reach and sales potential.

By selling to private labels, a manufacturer can eliminate the cumbersome branding process that requires creation, testing, implementation, and distribution. When you have a business to run, these actions can be time consuming and costly. Selling to a private label can bypass much of the branding process to save time and money. For companies that choose to produce their products under both their own brand and that of a private label, Century Label can handle the packaging needs for both.

Higher Profit Margins

Brand personality is incredibly important for building a customer base, creating product designs, and establishing marketing campaigns. If you run a business, however, you know how expensive and time-consuming branding can be. Private label products use the retailer’s private label brand. It is up to the end retailer to design the manufacturing, packaging, and marketing – not up to you as the creator of the good, eliminating added costs. You only pay the product cost without a premium for brand name or expensive marketing campaigns.

Lower Operating Costs

Private label products have to sell themselves; they are typically items that do not necessarily need advertising campaigns to fly off the shelves. Products chosen should regularly sell at five or six times the manufacturing price. This will leave the manufacturer room to provide the price discounts required of private-label goods. Therefore, most items chosen are cheaper to manufacture and produce in high volume. Since most private label products end up receiving large orders from major retailers, manufacturers yield the benefit of creating and shipping all products to a single customer. Both factors result in reduced operating costs.

Better Brand Loyalty

In the past, consumers largely saw brand-name goods as superior to private labels. Today, however, store brand or private label goods have made a name for themselves in the world of high-quality goods. Private label products have attained higher quality levels and consistency, thanks to better product innovations and improved manufacturing processes. They have transformed into “premium” private label goods. A better reputation surrounding private label products has led to better brand loyalty, with consumers staying loyal to one store because they know that is the only place they can find the private label item.

RELATED ARTICLE: The Importance of Packaging: Why it’s Necessary to Take Branding Seriously

Greater Market Stability

Today’s consumers choose private label products for quality, consistency, and affordability. Even in economic downturns, private label goods enjoy steady sales thanks to lower price points. The overall stability and inelasticity of the market can benefit manufacturers, as there is less of a chance of retailers freezing their orders during tough times. In fact, most retailers will increase their order quantities during economic downfalls because private label goods become more popular when times are tough.

If you would like to enjoy the myriad benefits of private labeling at your manufacturing company, contact Century Label to receive a free quote. We can provide high-quality labels and packaging for a manufacturer’s own brand as well as private labels.

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