Private Label

What is private label?

Private labeling is selling products a company makes under another company’s or business’s brand.

Private label products are the products manufactured by one company for sale under another company’s brand. Private-label products are available in a wide range of industries and are often sold at a lower cost.

The advantages of private labeling:

• a loyal customer base
• high margins compared to reselling products
• an opportunity to operate as a wholesaler for your brand
• separating yourself from your competitors

The disadvantages of private labeling:

• a requirement of minimum orders
• a possibility of unsold inventory
• customers often trust a brand they’ve used for a long time, as opposed to a little known private-label brand

To avoid the drawbacks of private labeling, do your research on customer preference before you invest in private-labeled products.