White Label Agency Write for Us
In other words, when we talk about white goods, we refer to the items that the distributor, such as a supermarket, offers with a distinctive character.
These products distinguish by their simple design and packaging. In count, the price and quality of the good are a relatively lower link to the rest of the marketplace.
To understand it better, let’s visualize the case of a remote label detergent. The creation does not belong to a cleaning goods company, but is sold under the name of a supermarket, for example, “Metropoli,” and is sold exclusively in this establishment.
Origin of the white label concept
White markings have their origin in World War II in Germany. In this challenging stage, consumers have stopped paying attention to famous brands, favoring the purchase of low-cost products without a well-known logo. Later, the trend extends to other countries such as the United States or France, especially in the 1970s.
Evolution of the white label concept
Initially, private label products only covered basic categories of food and cleaning products, such as detergents. Their goal was to offer lower quality items than those from well-known companies at a much lower price.
Over time and with increasing competitive pressure, private labels have evolved into higher-quality products with more refined packaging. In addition, the offered delay includes products that are not in the basic basket.
In other words, private labels have sometimes become what we call our brands or private labels that are not necessarily of lower quality and can compete relevant to companies in the industry.
Advantages and disadvantages of private labels
Private labels have several advantages and disadvantages, depending on the economic agent in question:
From the distributor’s idea of view: the distributor can make higher profits than if he only sold well-known brands. In addition, he can retain consumers and gain greater bargaining power with suppliers. However, the downsides come from the fact that running a white label involves assuming the costs and risks of management. It increases the workload of the dealer.
From the consumer perspective: the consumer can benefit from a lower price and more variety through competition. However, the opposite result can occur if distributors begin to exercise market power by excluding traditional brands.
From the point of view of the private label manufacturer: the distributor delivers the production of its private label to a third party. If it manufactures in large quantities, this company can benefit from the generation of economies of scale. That is, the cost of each new unit produced is decreasing. However, the downside is that this creator ends up being highly dependent on the retailer’s demand.
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