The increase of consumers choosing private label brands is allowing retailers to compete with national brands like never before. Shoppers who used to view private label branded products as inferior, generic versions of the “real thing” now consider their quality on par withif not better thanthe major brands. Although some companies have succeeded with this approach, creating a private label program presents many challenges like finding the right team, creating a strong brand identity and establishing value.

Assemble A Focused Private Label Team
Appointing a separate department that handles all aspects of developing the productsright down to controlling costs and managing the inventory is one fundamental that expert Ron Menconi says is a key to private label success. Dedicated managers need to be on board running the program. This focus from seasoned employees will help ensure margins are high enough and inventory is controlled.

Build Brand Identity
The Kroger Co. grocery store has found huge success in its private brand Simple Truth Organic which is now one of the largest natural food brands in the country. Kroger CFO Mike Schlotman said, “I never understand why people are OK drinking my milk, but they want Windex to clean their bathroom mirror instead of Kroger cleaner for their mirror. I think the Simple Truth brand starts to unlock that mystery a little bit because of how strong the brand name is. Without any fear, the customer’s already attributing a high sense of quality to it…” The Simple Truth creative elements are clearly recognizable to customers so that they know what to reach for every time.

Establish Value
Costco, with their Kirkland Signature label, has mastered the art of building a brand and positioning it to drive margin. Kirkland products are less expensive alternatives to products in the same category with the same or better quality. Kirkland has done an exceptional job leveraging its reputation from existing and trusted products to enter new categories with higher-end products.

Private label brands can help bring your business success. With the right resources you can you create quality products at reasonable prices that will help customers recognize real value that sets your brand apart from national competitors.