When thinking of different types of branding, private label branding is something to consider. Private label brands are products or services manufactured or provided by one company under another company’s brand. Also referred to as OEM (Other Equipment Manufacturer) these items could add major margin to your store giving it credibility and trust with shoppers.
To better understand private label branding, let’s look at a company like Target. Target sells snacks from companies like General Mills and Frito Lay but is also sells the Archer Farms brand which is Target’s private label brand.
Private label branding has its shares of pros and cons. Read on to find out how it can help or hurt your business.
Pros of Private Label Branding
Complete Control over Production and Pricing:
In private label branding, companies have complete control over the product’s ingredients, manufacturing, pricing and quality.
Due to the amount of control companies have, they can quickly get a product on the market, even if larger companies may not be interested in producing a niche product.
Control Over Branding:
The product will feature the name brand and brand logo design created by the retailer.
Control Over Profitability:
Because companies control all production costs and pricing, they have the ultimate control on how much the product will make.
Cons of Private Label Branding
Although companies have a lot of control over their private label branding, they do have to rely heavily on their manufacturer as well. That’s why it’s best to work with well established companies. Otherwise, you can miss out if your manufacturer runs into problems.
Because your product is sold in your stores only, it won’t be as widely distributed as other products and does not have as much potential for high sales and brand awareness. On the other hand, if your product goes over well, customers will have to go to the company that sells it exclusively.
Private label branding has a number of advantages and disadvantages. You can decide whether it is right for your company. If this is the case, you will need experts to help you develop your brand. A design branding agency like Lien Design can help.
Lien Design is a design branding agency based in San Diego, CA. They are always on top of the latest trends and can create unique branding for your products and services, including website graphic design, no matter what you are looking to promote. Call them first if you are looking for branding and design that will get your product noticed.