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Why Private Label Manufacturing is Worthy for New-Age Entrepreneurs

It has been noticed over the last couple of years that a huge number of enterprises have taken up private labeling as a viable business model. A private label product is manufactured by a contract or third-party manufacturer and sold under a retailer’s brand name. Private labeling offers retailers the chance to earn a greater profit margin over selling national brands.

Breaking Down ‘Private Label’

Brand owned not by a manufacturer or producer but by a retailer or supplier who gets its goods made by a contract manufacturer under its own label. Prices for private brands tend to be less than those of nationally recognized name brand goods. It has become a very popular business model for China manufacturing. Private labeling would involve you creating your own brand and arranging with your China supplier to print or emboss that brand onto the same, or similar products. Most ideal private-label items are easy to produce in volume and inexpensive to manufacture. With private labeling, retailers can acquire products that are already developed, or that can be changed and re-branded in an individual fashion.

New-Age Entrepreneurs

The Growing Acceptance Of Private Labels And Generic-Brand Items

Over the years, there’s been an influx in private-labeled goods. People are quickly learning private labels are the same quality as larger national brands. Consumers all over the world are feeling hugely satisfied with the private labels and generic-brand items, and both the online and offline stores have become more popular thanks to the way they are presenting their own private-labeled product lines. Retailers are using horizontal shelf displays techniques, such as brand blocking, and end-cap display fixtures to make private labels stand out from national labels. That is the primary reason some private label categories are seeing strong growth all across the USA.

Some of the most popular marketplaces for private label products are:

  1. Alibaba
  2. Amazon
  3. eBay

Unlike name brands, these products don’t have to pour in huge dollars for advertising. After sourcing from China, the product can be sold at a more attractive price point without sacrificing quality. Private labeling allows for greater control over many factors – including sales, marketing, and distribution.

Private Label Categories

  • Dairy items
  • Personal care
  • Household cleaners
  • Cosmetics
  • Paper products
  • Frozen foods
  • Condiments and salad dressings
  • Beverages

Manufacture your private label product in China

Foreign entrepreneurs often question whether Chinese manufacturers ‘allow’ their products to be private labeled. The answer is almost always, yes. Chinese suppliers are, in general, very flexible. They make products according to buyer specifications. The positive aspect of this is that you can essentially get any product out there private labeled.

Where to find private label manufacturers in China

  • Reddit
  • Warrior Forum
  • SaleHoo forum

Private labeling allows retailers to offer something distinct to their customers. It is an excellent way to separate yourself from your competitors. Supermarkets routinely use private labels to fetch strong profit margins that offset minimal gains on top industry brands with high costs of acquisition. Retailers with strong private label brands create exceptional sales opportunities for themselves. It is YOUR “brand” name that is identified with the product.

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