Terms

Private Labeling

Private labeling is the practice of a company selling products manufactured by a third party under its own brand name. In this model, the retailer typically controls the product's specifications, branding, and marketing, while the manufacturer is responsible for production. These products are then sold exclusively by the retailer, often as store brands that compete with established national brands.

Benefits of Private Labeling

Private labeling offers businesses significant advantages. It allows for greater control over product design, branding, and pricing, leading to higher profit margins. By offering exclusive products, companies can differentiate themselves from competitors and build strong customer loyalty. This model provides the flexibility to adapt quickly to market trends.

Steps to Start Private Labeling

This is how you can launch your own private label product line.

  1. Research your market to identify a profitable product niche and define your product specifications.
  2. Find and evaluate potential manufacturers by checking their production capabilities, quality control, and minimum order requirements.
  3. Request samples from your top choices to test product quality before negotiating terms and signing a contract.
  4. Develop your branding and packaging, then launch your product with a solid marketing strategy to attract customers.

Private Labeling vs. White Labeling

While often used interchangeably, private and white labeling serve different business needs.

  • Private Labeling: This involves creating a unique product exclusively for one retailer based on their specifications. It offers exclusivity and higher margins but can require larger minimum orders. Enterprises use this to build powerful store brands, while mid-market companies leverage it to create unique products and differentiate themselves from competitors.
  • White Labeling: This model applies a brand to a generic product sold to multiple retailers. It allows for a quick market entry with lower upfront costs but lacks exclusivity. Enterprises use it to rapidly expand product lines with minimal risk, while mid-market companies find it useful for testing new categories without investing in custom development.

Challenges in Private Labeling

Private labeling presents unique hurdles. Businesses must navigate reliance on third-party manufacturers, which can lead to production delays or quality control issues. Additionally, building a new brand from the ground up requires significant investment and effort to gain customer trust.

  • Dependence: You are reliant on your manufacturing partner for quality and timeliness. Any production delays or inconsistencies can directly impact your inventory, customer satisfaction, and brand reputation.
  • Inventory: Manufacturers often require large minimum orders, which can be a significant upfront cost. This creates the risk of dead inventory if the product doesn't sell as expected, tying up capital.

Trends in Private Labeling

Private labeling is evolving far beyond its origins as a low-cost alternative. The market is experiencing significant growth, with store brands expanding into new categories and gaining substantial market share. This shift is driven by changing consumer perceptions and new opportunities for businesses of all sizes.

  • Growth: Sales are surging as major retailers expand their private label offerings across diverse product categories.
  • Premiumization: Brands are increasingly offering high-quality, premium products that compete on quality, not just price.
  • Accessibility: E-commerce and online manufacturing directories have lowered the barrier to entry for smaller businesses.
  • Customization: There is a growing demand for unique, customized products that help brands stand out from competitors.

Frequently Asked Questions about Private Labeling

How do I find a reliable manufacturer?

Research online directories, attend industry trade shows, and vet potential partners thoroughly. Check their certifications, production capacity, and client reviews to ensure they meet your quality standards and can scale with your business.

What are the typical profit margins for private label products?

Profit margins vary widely by industry but often range from 20% to over 40%. By controlling production costs, branding, and pricing directly, you can achieve significantly better margins than you would by reselling established brands.

Is private labeling legal?

Yes, private labeling is a completely legal and standard business practice. It operates on a contractual agreement between a manufacturer and a retailer. Ensure your contracts clearly define intellectual property rights, quality control standards, and liability terms.

Other terms

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Serviceable Available Market

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Serviceable Available Market

Channel Partner

A channel partner is a company that works with a manufacturer or producer to market and sell their products, software, or services to customers.

Channel Partner

GPCTBA/C&I

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GPCTBA/C&I

AppExchange

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AppExchange

Loss Aversion

Loss aversion is our tendency to feel the sting of a loss more acutely than the pleasure of an equivalent gain.

Loss Aversion

Sales Funnel Metrics

Sales funnel metrics are key data points that track how effectively you're moving potential customers from awareness to a final purchase.

Sales Funnel Metrics

Annual Recurring Revenue (ARR)

Annual Recurring Revenue (ARR) is the predictable income a company expects to receive from its customers over a one-year period.

Annual Recurring Revenue (ARR)

Inventory Management

Inventory management is the process of ordering, storing, and using a company's inventory, from raw materials to finished goods.

Inventory Management

B2B Intent Data

Learn about B2B intent data, including how B2B intent data enhances sales strategies, sources of B2B intent data, leveraging B2B intent data for competitiveness.

B2B Intent Data

Request for Proposal

A Request for Proposal (RFP) is a formal document that outlines a project's needs and invites qualified vendors to submit bids to complete it.

Request for Proposal

Drip Campaign

A drip campaign is a series of automated messages sent to prospects or customers over time to nurture leads and drive engagement.

Drip Campaign

Integration Testing

Integration testing is a software testing phase where individual modules are combined and tested together to verify their interaction.

Integration Testing

InMail Messages

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InMail Messages

Direct Sales

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Direct Sales

B2B Marketing Analytics

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B2B Marketing Analytics

Champion/Challenger Test

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Champion/Challenger Test

Sales Compensation

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Sales Compensation

B2B Data Enrichment

Learn about B2B data enrichment, including benefits of B2B data enrichment, implementing B2B data enrichment strategies, B2B data enrichment vs. data cleaning.

B2B Data Enrichment

B2B Intent Data Providers

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B2B Intent Data Providers

Dynamic Segment

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Dynamic Segment

Corporate Identity

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Corporate Identity

Voice Broadcasting

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Voice Broadcasting

FAB Technique

The FAB technique is a sales framework connecting product features to advantages and then to the specific benefits for the customer.

FAB Technique

B2B Leads

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B2B Leads

Version Control Systems

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Version Control Systems

B2B Demand Generation Strategy

Learn about B2B demand generation strategy, including key elements of demand generation, & crafting your demand generation plan.

B2B Demand Generation Strategy

Lightning Components

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Lightning Components

Outbound Sales

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Outbound Sales

Lead List

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Lead List

Lead Conversion

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Lead Conversion

B2B Demand Generation

Learn about B2B demand generation, including strategies for effective B2B demand generation, & key components of a demand generation program.

B2B Demand Generation

Landing Pages

A landing page is a standalone web page created for a marketing campaign. It’s where a visitor “lands” after clicking an ad or email link.

Landing Pages

CSS

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CSS

Dialer

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Dialer

On Target Earnings

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On Target Earnings

Customer Lifecycle

The customer lifecycle is the journey a person takes from first becoming aware of your brand to becoming a loyal, repeat customer.

Customer Lifecycle

Closed Lost

Closed Lost is a sales term for a deal that didn't go through. The prospect decided not to buy, or the sales team disqualified them.

Closed Lost

C-Level or C-Suite

The C-suite, or C-level, refers to a company's most senior executives. Their titles usually start with 'Chief,' such as CEO, CFO, or CTO.

C-Level or C-Suite

PPC

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PPC

Sales Forecast

A sales forecast is a projection of future sales revenue. It's a crucial tool for businesses to make informed decisions and allocate resources.

Sales Forecast

Forecasting

Forecasting uses historical data to make informed predictions about future trends, helping businesses anticipate outcomes and plan accordingly.

Forecasting

Personalization

Personalization is the practice of using data to tailor products, services, or content to an individual's specific needs and preferences.

Personalization

Sales Director

A Sales Director leads a sales team, develops strategies, and is responsible for meeting a company's revenue targets.

Sales Director

Business Process Management

Learn about business process management, including benefits of implementing BPM, steps to effective BPM, common BPM mistakes to avoid, & BPM tools and software.

Business Process Management

Account-Based Selling

Account-Based Selling is a B2B strategy where sales and marketing treat high-value accounts as markets of one, using personalized outreach.

Account-Based Selling

Proof of Concept

A Proof of Concept (PoC) is a small exercise to test whether a business idea or project is technically feasible and has real-world potential.

Proof of Concept

Sales Funnel

A sales funnel is a model illustrating the customer's journey from initial awareness to the final purchase, narrowing down leads at each stage.

Sales Funnel

Video Email

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Video Email

Always Be Closing

“Always Be Closing” (ABC) is a sales mantra meaning every action a salesperson takes should be with the ultimate goal of closing the sale.

Always Be Closing

Customer Success

Customer Success is a business strategy focused on proactively helping customers achieve their goals with your product or service.

Customer Success

Buyer's Journey

The buyer's journey maps the path a potential customer takes, from first becoming aware of a problem to making a final purchase decision.

Buyer's Journey

Sales Forecast Accuracy

Sales forecast accuracy is a key metric that compares your predicted sales revenue against the actual sales revenue you ultimately achieve.

Sales Forecast Accuracy

Sales Coaching

Sales coaching is a process where managers help reps improve their skills and performance through personalized feedback, training, and guidance.

Sales Coaching

Trade Shows

Trade shows are events where companies in a specific industry showcase their latest products and services to find new customers and partners.

Trade Shows

Ballpark

Learn about ballpark, including estimating with ballpark figures, understanding ballpark estimates in sales, & ballpark estimates vs. precise quotes.

Ballpark

Open Rate

The open rate is the percentage of recipients who opened an email. It's a primary indicator of a subject line's effectiveness.

Open Rate

Data Encryption

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Data Encryption

Marketing Attribution Model

A marketing attribution model is a framework for assigning credit to the marketing touchpoints that lead a customer to convert.

Marketing Attribution Model

SPIN Selling

SPIN selling is a sales technique using a sequence of questions—Situation, Problem, Implication, Need-Payoff—to uncover a buyer's needs.

SPIN Selling

Follow-up

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Follow-up

Sales Kickoff

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Sales Kickoff

Regression Testing

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Regression Testing

Consultative Selling

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Consultative Selling

Warm Outbound

Warm outbound is a sales strategy for contacting prospects who've shown interest in your brand through prior engagement, like website visits.

Warm Outbound

Direct-to-Consumer

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Direct-to-Consumer

B2B2C

Learn about B2B2C, including benefits of B2B2C model, key strategies for B2B2C success, & B2B2C vs. B2C vs. B2B: understanding the differences.

B2B2C

Enterprise

An enterprise is a large-scale organization, often a corporation, defined by its complex structure and substantial number of employees.

Enterprise

Demographic Segmentation in Marketing

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Demographic Segmentation in Marketing

Representational State Transfer Application Programming Interface

A Representational State Transfer (REST) API is a web service that uses a simple, stateless architecture for systems to communicate online.

Representational State Transfer Application Programming Interface

Bounce Rate

Learn about bounce rate, including understanding bounce rate implications, key factors affecting bounce rate, & reducing your bounce rate effectively.

Bounce Rate

ETL

ETL, short for Extract, Transform, Load, is a data integration process for moving raw data from various sources to a central data warehouse.

ETL

Gone Dark

Going dark is when a once-responsive prospect suddenly stops all communication, leaving you wondering what went wrong.

Gone Dark

Website Visitor Tracking

Website visitor tracking collects and analyzes data on user behavior to understand their journey and improve the overall user experience.

Website Visitor Tracking

Sales Intelligence Platform

A sales intelligence platform is software that provides sales teams with data and insights about prospects to help them sell more effectively.

Sales Intelligence Platform

Multi-threading

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Multi-threading

DMP

A Data Management Platform (DMP) is a tech platform used to collect and manage data, mainly for digital marketing and advertising campaigns.

DMP

Demand Generation Framework

A demand generation framework is a strategic process for creating awareness and interest in your product, ultimately driving new business.

Demand Generation Framework

Browser Compatibility

Learn about browser compatibility, including understanding the importance, common challenges, best practices, & tools for testing.

Browser Compatibility

Predictive Lead Generation

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Predictive Lead Generation

Closed Question

A closed question is a type of query that elicits a simple, often one-word answer like 'yes' or 'no,' or a specific, factual response.

Closed Question

Data Visualization

Data visualization is the practice of translating information into a visual context, like a map or graph, to make data easier to understand.

Data Visualization

CDP

A Customer Data Platform (CDP) is software that gathers and organizes customer data from various touchpoints into a single, unified profile.

CDP

Pipeline Coverage

Pipeline coverage is a key sales metric. It's the ratio of your total open pipeline value to your sales quota for a specific period.

Pipeline Coverage

Marketing Mix

The marketing mix is the set of marketing tools a company uses to sell products, defined by the 4Ps: Product, Price, Place, and Promotion.

Marketing Mix

Salesforce Administrator

A Salesforce Administrator is a certified professional who manages and customizes the Salesforce platform to meet a company's specific business needs.

Salesforce Administrator

MOFU

MOFU, or Middle of the Funnel, is the crucial evaluation stage in the buyer's journey where leads compare solutions to their known problem.

MOFU

Horizontal Market

A horizontal market is one where a product or service is designed to meet a common need for a wide array of customers, regardless of their industry.

Horizontal Market

Agile Methodology

Agile methodology is an iterative approach to project management and software development, focusing on delivering value in small, incremental steps.

Agile Methodology

Sales Engagement

Sales engagement is the sum of all interactions between a seller and a prospect, aimed at building a relationship and moving a deal forward.

Sales Engagement

B2B Contact Base

Learn about B2B contact base, including building an effective B2B contact base, & strategies for expanding your contact base.

B2B Contact Base

Firmographic Data

Firmographic data is information used to classify firms. It includes attributes like industry, employee count, location, and annual revenue.

Firmographic Data

Weighted Sales Pipeline

A weighted sales pipeline forecasts revenue by assigning a closing probability to each deal, giving a more accurate picture of potential income.

Weighted Sales Pipeline

Dynamic Pricing

Dynamic pricing is a strategy where businesses set flexible prices for products or services based on current market demands and other factors.

Dynamic Pricing

Point of Contact

A Point of Contact (POC) is the designated individual or department that serves as the main hub for information and communication on a matter.

Point of Contact

B2B Sales Process

Learn about B2B sales process, including key components of B2B sales processes, & crafting an effective B2B sales strategy.

B2B Sales Process

Sales Pipeline Management

Sales pipeline management is the process of organizing, tracking, and managing potential deals through every stage of your sales funnel.

Sales Pipeline Management

Site Retargeting

Site retargeting is a marketing strategy that shows ads to people who have previously visited your website but left without converting.

Site Retargeting

Return on Marketing Investment

Return on Marketing Investment (ROMI) measures the revenue generated by a marketing campaign relative to the cost of that campaign.

Return on Marketing Investment

Call Disposition

Call disposition is the process of labeling the outcome of a call. It helps sales teams track interactions and plan their next steps effectively.

Call Disposition

Digital Advertising

Digital advertising is the practice of delivering promotional content to users through various online and digital channels like social media or search engines.

Digital Advertising