what is a private label

What is a Private Label, and Why it’s Good for Your Business

By Harriet
Reading Time: 4 minutes

Imagine your favorite brand. Maybe it’s one of those big ones, like Apple, or Nike. Maybe it’s one of those lesser-known ones, that’s only really known in your part of the world. What do they have in common?

Easy answer – they have a name. They have a label. You’re not just buying a random tablet or just some random running shoes. You know what you’re buying because these companies put their name on their product. With that comes images of quality and of identity, because of the name attached to the item.

That’s the basic idea behind the concept of brand recall. Those companies are willing to put their names at stake, as they know that they’re offering quality products.

What, then is a Private Label, and what’s the difference between a Private Label and a Brand? Sometimes the terminology can be confusing – hopefully, this article will help clear things up and make it simple for you!

what is a private label

What is a Private Label?

A Private Label is a product that is manufactured by someone else, and sold under a brand that the retailer has created. Think Marks & Spencer’s food items, or even Waitrose and Trader Joe’s. Yes, they are big brands, but they are also Private Labels!

The key difference is that they do not actually produce the items they sell under those brands. They are manufactured by a third-party manufacturer, and these companies just brand and package them. The lines are actually pretty blurred now because gone are the days when Private Labels are seen as inferior to “branded” items.

So what does this mean for an online seller such as yourself, and why should it matter?

Private Labels differentiate themselves from sellers who just sell “generic” items.

This concept of Private Labels really frees you with the type of business you want to engage in. You don’t have to have the extensive capital that those big companies have to have your own brand.

It only takes a little resourcefulness and creativity, and you can really have a product that has an identity of its own. Once you’ve found the perfect supplier to work with, all you need is a name and an idea, and you can have a Private Label that you can call your own.

The main benefit of doing this is that you differentiate yourself from the competition, and add more credibility to yourself as a brand that has its own unique identity. You are making your mark in the market, and putting your stamp on the product you are selling.

This is often the first step for a small business, to get it up and running. When you sell on platforms like Amazon, you’ll want to do it as a private label so you stand out against those “generic” ones.

Think about it, would you rather buy a generic “yoga mat” from a seller who sells all sorts of items, or a CalmMind Yoga Mat (a Private Label, for example), given that the quality is the same and the price is not far off? There’s a slight edge that you get from having a brand, and sometimes that’s all you need.

Just take a look below at the Amazon search for “yoga mat”… You need a name to be able to differentiate from all the other sellers!

private label yoga

Some things to consider for your Private Label

Your first point of call is making sure you find a supplier who allows you to sell the products that they make under your own brand.

Once you find a great supplier, you have control over the quality, branding, and packaging of your product. You can demand quality from your supplier, because you’re the one who’s putting your name out there. It’s a good idea to order a sample before you place your first order.

One other thing to consider though, is that since you’re not the manufacturer, there are things that won’t be under your control. Depending on where you source and who you work with, you might encounter supply chain problems like delayed lead times from your manufacturer. It’s important to partner with a well-established company so you can avoid these problems, and focus on selling.

And of course, you can’t just slap on any name on your product – you need a little bit of “legal compliance”. You want your own unique brand, so make sure that your name and concept has not been used before, and you’re not infringing on some copyrights and other established trademarks.

(You’ll need to check the country where you plan to sell. For sellers in the US, check the USPTO website; for sellers in the UK, check the Gov website)

Not a deep-dive into “branding”, but eventually leads into it

The key takeaway here is that you don’t need a fully fleshed-out brand identity when creating your Private Label. You make a basic identity and just go with it. This is simple for beginner sellers to do. What’s important is you get your name out there and try things out.

The bottom line is, in the long run, creating a private label is more beneficial than just selling “generic” items. In time, your little Private Label might even turn into a powerhouse brand – but by then, you would have already reaped the benefits.

You can evolve and improve your brand, because it’s yours. Over time, you can invest in better design and packaging, or even create a brand which has a philosophy, and an iron-clad mission, vision, and values.

At ImportXperts, we teach you how to create your own Private Label so that you can stand out from your competition. And once you’re ready to develop your brand further, we also got you covered!

  • Jeff James Freedom45 Ltd says:

    Hey Harriet, Great article, and you did what you said you’d do, you took the essence of mine and expanded it out and created this.

    I think that it is essential for IX students to have this information; It gets confusing at first and to have this clearly written and stated from Mentors really helps.

    Thank you, Harriet, another quality piece from you as always. Jeff


Your email address will not be published. Required fields are marked *