WHAT IS PRIVATE LABELING
Private labeling of products refers to a business practice in which manufacturing is done by one company, and the product is sold under the brand name of another company. The company, whose brand name is being used to sell the product, directs the manufacturer to make the product according to specific design, composition, and packaging.
This practice has been adopted mostly by companies that are starting in the market. But they are also popular among some top brands, namely Nike and apple.
This kind of labeling is practiced mostly in personal care products, clothing, foods, pet foods, and shoes. They are most relevant for products that require high adaptability to market demands and constantly need new variations to be the market leader.
PROCESS INVOLVED IN PRIVATE LABELING
The first and foremost thing that you should do when you contact a private label manufacturer is to ask for samples of the design you selected for your product. In this way, you can test the product’s quality before it is sold in the market.
After you are satisfied with the product’s quality, you must select the right packaging for your product. You should select the best type of packaging which suits your budget and is suitable for your product. Let your label manufacturer know if you like any of their available packaging types or if you want to mix different types of packaging to create a unique look for your product.
Then to finish the look of your product, you should finalize the logo of your brand. If you are an existing company, you can use the same logo and just direct the manufacturer regarding your logo’s placement on the package. You can also ask for a graphic review to take the final call before the product is launched in the market.
The label manufacturers also help you to name your product. Choosing your product’s right name is important because it is through that name that the customers will connect with your brand. The option of color-coding labels and having bilingual label content is also possible in some cases.
Finally, when you have figured out all the product details, you can start selling them. The label manufacturer should send you a customized form that will be unique to the company. Such a form will preserve all the details of your product and easily reorder items when the old ones are sold.
ADVANTAGES OF PRIVATE LABELING
This labeling of products helps to save operating costs for the company. Since label manufacturers handle the high-investment works such as manufacturing, packaging, and labeling, the company can save a lot of capital and use it elsewhere, such as in marketing.
Since investment is low, the price of the products can be kept low. This may lead to a higher volume of sales and increase the profit margin of the company.
If you have selected the right label manufacturer, then the product quality will be high. Since the product will be sold under the company’s brand name, this will lead to high customer loyalty to your product.
Because such products are adaptable to changing consumer behavior, companies selling such products enjoy stable market conditions.