Similar to white label products, private label products are items manufactured by one corporation for sale and branding by another. A company that sells private label products is searching for a product that they can market and distribute as though it were their own. Clothing and cosmetics, as well as condiments sold in supermarkets, are examples of private label items.
According to Statista, total retail sales of private-label goods in the United States reached $5.47 trillion in 2019 and are expected to reach $5.94 trillion in 2024. That comes as no surprise, given the prevalence of private label items in most major retailers. For e.g, Target’s Archer Farms private label, Walmart’s Great Value, and Costco’s Kirkland.
Advantages of private labeling
Private labeling offers a variety of benefits in addition to streamlining the product production process. Among the benefits are the following:
- Control overproduction: In terms of materials and ingredients, cost, and production space, you guide third-party manufacturers.
- Control overpricing: As the seller, you have power over your selling strategy and how you optimize production costs, which aids in the creation of a healthy profit margin.
- Adaptability: Smaller retailers may respond rapidly to rising consumer demand for a new feature by developing a private label product, while larger corporations do not attempt a niche product.
- Control over marketing and branding: Before putting your private label goods on the market, you get to decide how you want to market and package them.
Disadvantages of private labeling
Although there are many advantages to private labeling, it is not without its drawbacks:
- Manufacturer dependency: Since manufacturing is handled by a third-party vendor, you’re largely at their mercy. That is why it is important to work with a credible and trustworthy manufacturer.
- Difficulty building loyalty: When you’re building a brand from the ground up, it may take some time to gain traction. This is one of the reasons why private label products are ideal for people and brands who already have a loyal following.
- Poor consumer perception: Private label goods have a bad reputation for being low-cost and low-quality. The understanding, however, is evolving. Many consumers believe that the quality of private-label goods is improving around the world.
Private label manufacturers for creating a custom branded product line
While several private label manufacturers can appear to be identical, it’s critical to thoroughly vet each one to find the one that best fits your company’s needs now and in the future. You must think about the goods you want to manufacture and distribute, where you want to sell and ship them, and how much you can charge for them.
Here is a rundown of some of the best private label production providers and product procurement apps for a wide range of products. The majority of these places have a Shopify app that you can use to connect to your online store.
SupplyMeDirect is a company that ships from the United States, the European Union, and China. Automated order processing, local delivery when available, and a sensitive and supportive customer service team are just a few of the features.
The private label manufacturer’s app that syncs with your Shopify store is simple to use and also saves time and money for merchants.
Notice that regardless of where you or your customers are based, all payments are made in USD.
AOP+ Easy Print on Demand
AOP+ Easy Print on Demand is a platform for selling organic print-on-demand goods and services on Shopify and Etsy, with a focus on the EU, UK, and US. The AOP+ Shopify app, like SupplyMeDirect, connects to your Shopify store and automates order processing and fulfillment. It’s easy to use, and you can have a finished product in under 30 seconds.
Rather than using a third-party printer, AOP+ does all of the printing itself, and it will also collaborate with you to make your own personalized private-label items. It focuses on clothing and accessories, making it ideal for starting an online boutique, with items such as t-shirts, flip-flops, totes, and wall plaques.
Merchants really appreciate how supportive and insightful their live customer service team is.
Apliiq – Print On Demand
Centered in Los Angeles, Another private label and print-on-demand business that specializes in clothing is Apliiq. It specializes in fashionable items such as woven stickers, pocket tees, liner hoodies, and patch beanies.
Apliiq automates order management and fulfillment, similar to SupplyMeDirect and AOP+, and ships any order within a week. The Shopify app also gives your customers tracking details so they can see when their order will arrive.
Modalyst – Dropshipping
Modalyst is an AliExpress Partner and a dropshipping supplier that partners with US-based providers. This indicates that it has one of the most comprehensive product catalogs on the list, with over a million items to choose from.
It specializes in athleticwear as far as private marking goes. Modalyst’s Pro package, which costs $90 a month and includes a 5% processing charge, includes unlimited items, personalized packaging and branding, and quick shipping—typically three to eight days for US orders and less than 15 days for foreign orders.
Modalyst automates order management and delivery like other manufacturer applications for private labels. You can reach out to live chat help seven days a week if you run into any problems or have any questions.
Alibaba Group is one of (if not the) world’s largest e-commerce firms, with sales exceeding $72 billion in 2020. Alibaba has one of the largest directories, linking suppliers and merchants all over the world.
Despite the fact that Alibaba does not have a Shopify app and the two cannot be integrated, there are so many private label items available that it is worth mentioning. On Alibaba’s vast directory, you can find almost any product you can imagine.
Though Shopify apps help automate a lot of the process, working with Alibaba allows you to buy a lot of private label items directly from the manufacturer. This reduces inventory costs and increases earnings, but it also necessitates a higher initial investment. Manufacturers will collaborate with you to develop exclusive logos and designs.
Two guides have been created to assist you in navigating Alibaba and its sister site, AliExpress:
Look no further than the Dripshipper Shopify app if you’re looking to private label and sell coffee online. Your own branded packaging, logo, pricing, and labels can be created and customized.
Drop shipper is headquartered in the United States, but it ships internationally. All orders are sent within five days of receipt, and the coffee is always new. Whole beans are dispatched the same day they are roasted, while ground beans are dispatched the next day.
Pricing begins at $30 a month, with higher levels providing additional assistance, coaching, and training. At $197 a month, the Elite package also includes access to Dripshipper’s in-house design team.
Tips for starting a private label business
You don’t have to think about product development—or, in certain cases, inventory investments—when you market private-label goods.
1. Find a niche market to sell products.
You can sell a wide range of private label items, covering almost any industry. The following are some of the most common private label products:
- Hair products
- Body products
- Pet products
- Baby products
- Beard grooming products
- Health products
Explore various niche markets within those categories to find out exactly what to offer. You can use highly targeted marketing and promotional campaigns to get the brand and goods out there when you sell to a niche market.
2. Contact the manufacturer
Look for distributors and suppliers who have the products you want to sell once you’ve decided what you want to sell. Drop shippers, for example, are a manufacturer that specializes in a particular product category.
Make a list of the suppliers you want to contact and ask if they offer private labeling. If this is the case, ask about opening an account. This strategy would allow you to quickly source a variety of goods within the niche you’re investigating because most manufacturers carry a variety of products. Also, find out if the manufacturer has a minimum order value, as this will help you decide whether to keep the stock or open a prepaid account with them.
3. Order samples
It’s important to put the product through its paces before making it available for purchase. While something may appear to be excellent online and even sound excellent when you contact the manufacturer, the truth may be very different. As a result, you’ll want to do your homework to make sure the items meet your standards and expectations.
4. Set up an online store
Now that you’ve chosen your manufacturer and products, it’s time to build your online shop. You can select from a variety of free and paid e-commerce models and customize them with Shopify. After you’ve set up your online store, go to the Shopify App Store and look for the apps you’ll need to run your private label company, which may include any of the options mentioned above.
5. Add your products to your store.
You should do the following when adding items to your store:
- Write compelling product descriptions: Rather than describing features and specifications, product descriptions should concentrate on providing facts and benefits.
- Get high-quality product images: Product pictures give customers an image of what the item looks like—it’s the closest thing they can get without seeing it in person. The manufacturer can be able to provide you with photographs on occasion.
- Determine your pricing strategy: It’s important to set prices high enough to make a respectable profit while not outpricing the customers.
6. Launch and market your store
It’s not as easy as flipping on a switch when you’re ready to make your store and private label items public. If you want to make some sales, you’ll need to raise awareness and drive traffic to your website.
Paid ads on Google, Facebook, and Instagram are a perfect way to get your name out there for new businesses. Then add in email marketing, social media, content marketing, SEO, and customer loyalty services to round out the efforts.
Launch your private label brand
Brand creation is simplified when you start your own private label brand. You can launch your own private label and work directly with suppliers to develop goods that your customers would want to purchase, all while incorporating your distinctive branding and logo. Private labeling is an excellent way to begin selling your own goods on the internet.