Privatelabel

Private label, also written as privatelabel or private-label, refers to products manufactured by one company for sale under another company's brand. In this arrangement, the retailer or brand owner controls aspects such as product formulation, packaging, and quality standards, while production is often handled by a contract manufacturer or original equipment manufacturer (OEM). Private-label products are typically exclusive to the retailer, contrasting with generic or white-label goods that may be rebranded for many retailers.

Private labeling has expanded across industries, with notable growth in groceries, personal care, cosmetics, and household goods. Retailers use private-label lines to differentiate their offer, exert pricing power, and build brand loyalty around perceived value. Consumers may view store-brand products as equivalent in quality to national brands but at a lower price.

The business model involves a retailer issuing specifications and brand requirements to a manufacturer, negotiating pricing and lead times, and often managing marketing and packaging design. Some private-label contracts grant exclusivity for a particular product category or region. Manufacturers gain volume and long-term demand, while retailers gain control over branding, margins, and product availability.

Advantages include higher margins for retailers, inventory control, and faster market response. Challenges include dependence on contract manufacturers, quality assurance, supply-chain risk, and potential consumer skepticism about quality. Regulatory compliance, especially for food, cosmetics, and supplements, requires accurate labeling and safety testing.

Examples of well-known private-label programs include Costco's Kirkland Signature, Trader Joe's assortment, and Amazon Basics. The term also covers electronics, apparel, and beverages, and may overlap with white-label and original equipment manufacturing depending on the contract.