What is a White Label Product?

definition

White labeling is a manufacturing strategy adopted in large numbers several decades ago, primarily by grocery stores, and then quickly followed by other retailers. In order to establish brand loyalty, grocery stores in particular would commission other manufacturers to create products for them. These would then be labeled with the store’s label, rather than that of the initial manufacturer. Since you could only get the store brand items at that particular store, the hope was to inspire customers to maintain loyalty to a particular store or company.

You’ll see numerous examples of the white label product at grocery stores and at other retail outlets. Trader Joe’s, for instance, carries a huge number of white label product types that are labeled “Trader Joe’s.” These are usually offered at prices much less expensive than “brand” name labels, but the quality is frequently comparable if not better than those things sold with a different brand. In fact, especially in specialty markets like Trader Joe’s, you may be getting a considerable deal on high end products.

White label product types aren’t only restricted to food. Many huge retailers, Big Box stores and the like now have their own exclusive brand. You can buy Wal-Mart® labeled clothes, Office Depot® labeled paper and pens, and a plethora of other choices. Not every white label product is created equal. Some are cheap knock-offs of better quality brand names. But many do represent similar or better quality than brand name products.

It may be hard to get a store to disclose the original manufacturer of a white label product. In a way this is not in the interest of the store, since you then know where else you can purchase the product. Other stores are more open about manufacturers, and this has become especially important in regards to food manufacturing.

If you buy a white label product that is food, particularly since food safety has become such an issue in recent years, you may want to know who is making the product. Any recalls of food items often begin with listing the manufacturer of the food, and may not be able to list all white label products. If you know the manufacturer, and also where the food is grown or where it is manufactured, you can make better choices as a consumer.

Knowing the manufacturer can additionally help you decide whether the white label product is a better value or quality than its brand name competitors, or whether you wouldn’t purchase the product because you find the manufacturing company does not meet your standards for quality, safety, or ethics in conducting business. This is a problem, since disclosure of real manufacturers may be hard to come by. It’s also difficult to find out whether white label products support local businesses, or sustainable agriculture.

Another trend in white labeling is occurring on the Internet. This is when companies prepackage services or things like e-books, which you sell from your own site. The jury is out on whether white label Internet products or services will ultimately prove profitable.

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Written by Tricia Ellis-Christensen

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