Decoding Private Label & White Label Ecommerce Dropshipping

The online share of total retail sales has steadily been on the rise—with ecommerce penetration hitting 16.0% in 2019, according to a Digital Commerce analysis of the Commerce Department’s year-end retail data. That was up from 14.4% in 2018 and 13.2% in 2017. E-commerce is a huge platform which is growing at an unprecedented rate all over the world. Much of the ecommerce growth is attributed to the legitimate ecommerce dropshipping suppliers. Market experts are predicting that the e-commerce dropshipping business will have a huge impact in the coming years.

Private Label Dropshipping

Private-label products are the new challenger brands since consumers are willing to abandon brand loyalty for what they perceive as better value. Importantly, private-label brands are taking share in both online and in brick-and-mortar stores. A private label product is manufactured by a contract or third-party manufacturer and sold under a retailer’s brand name. As the retailer, you specify everything about the product – what goes in it, how it’s packaged, what the label looks like – and pay to have it produced and delivered to your store. This is in contrast to buying products from other companies with their brand names on them.

Credit goes to the ecommerce dropshipping suppliers to make private label products so popular among the buyers. If the customer loves your private-label products, they will want more, and the only place they can purchase them is in your store. In a retail world where loyalty isn’t as prevalent anymore, this is one way to keep your customers returning time and again. Using private labels becomes more effective when you develop and market products of a higher quality. It allows you to have the capability to demand better prices in the market. With the drop shipping industry becoming more competitive, you need to ensure that your business stays afloat.

The best way to do this is to become one of the private label dropshippers since it gives you a higher profit margin. The reason behind this is the fact that it helps you have a lower cost basis for your products, allowing you to gain more than the usual monthly profit for starters. As consumers are warming up to the idea of switching to private label brands, it’s an exceptionally good time for the businesses to fully explore the advantages from the ecommerce dropshipping suppliers.


White Label Dropshipping

White label products mean that when products are produced, there is no company y’s logo on them. But the buyers, retailers or suppliers can buy these products from manufacturers and resell them with their companies’ logo or brands. White label Dropshipping has a lot of advantages such as having an expanded market and more customers. For those who have just started their online business, you will struggle on getting more customers and marketing your products in the early stages. Once you have a reliable wholesale vendor, they will be the ones to sell the products to their customers resulting in more sales.

The white labeling concept involves two major players: the manufacturer and the dropshipper. The manufacturer mass produces a product and sells it on online marketplaces like Alibaba and Amazon. A drop shipper looking for products to white label to cut out costs for production will reach out to the manufacturer for a white label agreement which may involve labeling the product with the dropshipper’s brand, custom packaging, and shipping the re-branded product to the dropshipper’s customers.

Final Thoughts-

Whether it is a private label or white label ecommerce dropshipping, both have their benefits. As a business owner, it’s up to you how you are using private label and white label dropshipping to your strategic advantage.

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