As a player in the manufacturing industry, you are likely familiar with many different types of manufacturing. From construction considerations to production processes to safety precautions, the manufacturing industry is home to a wide range of opportunities and practices.
However, just because you are affiliated with the manufacturing industry, doesn’t mean you are entrenched in many of its moving parts. Nor should you be, as that would mean wearing a great many hats. But knowing about these moving parts, or the opportunities that are possible within the manufacturing industry is important. For instance, labeling is an aspect of the manufacturing industry. But even when it comes to labeling, there is not just a single type.
Private Label Manufacturing
So, what is private label manufacturing? Simply put, private label products are those that are manufactured by a certain company to be sold under another company’s label (or, more accurately, their brand). Typically, private label products tend to be custom manufactured for another company’s brand, with the purchasing company establishing the specifications pertaining to ingredients, packaging, and ultimately, what type of label it has.
Even though the manufacturing company is responsible for the production and packaging, the purchasing company has control over the product’s details and components. This can be beneficial for the purchasing company that will ultimately be selling the product under their own brand because they have control over a product without having to be responsible for the manufacturing equipment involved in its production.
Private labeling also gives the purchasing company the ability to be flexible and adaptable to consumer trends with less risk. This is because a purchasing company can decide to try a new product or packaging style without having to invest in the equipment. Private label manufacturers, therefore, are able to adjust their processes and also have to be flexible to meet the company’s requests and expectations.
Additionally, private label manufacturing can be more cost efficient for the purchasing company, since they are not having to buy popular name brand products, which can be expensive. For example, if a hair salon is going to sell shampoo (or additional products) out of their shop, they could turn to a private label manufacturer and have their own brand of shampoo on their shelves, as opposed to popular name brands. This is also beneficial for marketing purposes, as it helps spread the name of your brand or company.
Private label manufacturing is also popular because in addition to the already mentioned benefits, private label products are not limited to a single industry or enterprise. All sorts of companies in all sorts of industries take advantage of private label manufacturers to get new products into the market and enhance their name in their sector. While private label manufacturing touches most aspects of consumer goods, some of the most common include personal care products, cosmetics, clothing, paper products, and food and beverage products.
Popular Examples of Private Label Brands
As mentioned, private label manufacturing is affiliated with many different industries, though some are more common than others. For example, food production is a big draw for companies to partner with private label manufacturers.
One of the most successful examples of a private label brand is Kirkland, which is a series of consumer products made for and sold by Costco. These products are not limited to food and beverage, as they have many paper products, pet supplies, household items, and other types of products. That being said, Kirkland food and beverages are incredibly popular.
Other common examples include grocery store chains that have incorporated their own line of branded food products, as opposed to relying on costly name brands. Aldi is one such example, as it relies on a private label manufacturing partner to produce its own line of food and beverage products.
In this instance, Aldi is able to establish its costs, which the company touts as being lower than many competitors. Consumers have come to expect a certain quality and cost when it comes to Aldi products, and this works towards the brand’s larger image and marketing efforts. And such a business model would not be possible without the assistance of private label manufacturing.
Is Private Labeling Right For You?
If you are affiliated with a company looking to increase your presence or bulk up your consumer product line, then partnering with a private label manufacturing partner might be the avenue for you. Be in control of the product, the design, the ingredients, and the overall messaging, without worrying about the production details, or the need to purchase expensive equipment.
On the other hand, if you are in the manufacturing business, have the tools and resources available so that you can become a private label manufacturer and be there for many industries that are looking to get new products out every day.
Contact the experts at EAD today, and learn more about the benefits of private label manufacturing, and how it could play a role in your business.