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Private Labels Challenges & Opportunities

Private label products are those manufactured by one company but sold under another company's brand. They provide lower cost alternatives to national/international brands. There are different types - generics directly copy brands, value innovators offer innovation, and premium store brands compete with higher quality. Private labels provide retailers higher margins and control over inventory/marketing. Challenges include higher costs and risk if products fail. Examples given are popular private label brands from Indian retailers like Shoppers Stop, Westside, and Globus.

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Ankit Kumar Jha
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104 views12 pages

Private Labels Challenges & Opportunities

Private label products are those manufactured by one company but sold under another company's brand. They provide lower cost alternatives to national/international brands. There are different types - generics directly copy brands, value innovators offer innovation, and premium store brands compete with higher quality. Private labels provide retailers higher margins and control over inventory/marketing. Challenges include higher costs and risk if products fail. Examples given are popular private label brands from Indian retailers like Shoppers Stop, Westside, and Globus.

Uploaded by

Ankit Kumar Jha
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd

PRIVATE LABELS

CHALLENGES & OPPORTUNITIES


By.
ANKIT KR. Jha(M/11)
AVINASH
KHADURI(M/14)
GANESH(M/18)
JASMINE KAUR(M/21)
DEFINITION
• Private label product or services are typically those
manufactured or provided by one company for offer
under another company's Brand.
• These are available in a wide range of industries from
food to cosmetics to web hosting.
• They are often positioned as lower cost alternatives to
regional, national or international brands, although
recently some private label brands have been
positioned as "premium" brands to compete with
existing "name" brands.
Types of Private Label

Generics
Copy cats
Value Innovators
Premium Store Brands
GENERICS
The private label will be a replica of the original,
sometimes the brand name & the features will
almost be alike.
However generics are priced exactly 1/2of price of
price national brand.
Eg.- Big bazar
“LOOKS” = “LUX”
(5) = (10)
Both Lux & Looks are manufactured by the same
company.
COPY CATS
In this category only the brand name will be
copied (which almost sounds like original).
The copycats are mostly manufactured within
the company by the retailer him self.
Eg.- Sam’s cola
VALUE INNOVATORS
Not offered by national brand. A little bit of
innovation happens & brand provide
something more than national brand at
affordable price.
Eg.- In big bazar KORYO SENSEI,
Croma offers its own AC & TV under brand
name CROMA.
PREMIUM STORE BRAND
Here, Private Labels are more expensive than
national brand & will have superior quality,
good features & design.
Eg.- In globus F21 is very superior quality wise
& offers better features & design especially for
women segment.
In west side 80% of the merchandise are own
brand & they are far superior in quality as
compared to national brand.
Advantages
• More margin for retailers
Eg.- In shoppers stop their own brand is called “STOP”.
• Entering into few sectors where there are no national brand
available.
Eg.- In big bazar there is a private brand called “TASTY TREAT”.
• Private labels can offer huge discounts which the national
brands cannot offer.
Eg.- In pantaloons there is a private brand called “Bare”.
• Some time private label will be priced more than national
brand by offering superior quality & can even attack
national brand.
Eg.- John miller is a private label by pantaloons which competes
John players.
ADVANTAGES

Substantially higher margins than a brand name products


Greater freedom with pricing strategy
Freedom to create own marketing plans
Private brand will increase sales
Retailer will have control over the stock inventory
Create a positive image of outlet for the customer which
will lead to stronger customer loyalty
Reduce dependance on brand names for sales
Positions outlet better in a tight economy
Challenges faced by Private Labels:
 

Higher risk of inventory.


Higher Research and Development expense.
Markdown or return allowances will not be
available.
Failure of the product will create a negative image
about the retailer.
More marketing expenses.
SOME PRIVATE LABELS

Shopper Stop : STOP, Kashish, LIFE, Vettorio Fratini, Elliza Donatein,


and Acropolis

Westside : Gie, 2F4U, SRC, Gia, Urban angel, Intima, David Jones,
Ascot

Globus :- F21 and Globus

Wallmart :- Faded Glory, your zone, Color Place , Metro 7, Ozark


Trail, Hometrends, Gold's Gym etc.

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