While branded products are the more traditional way to manufacture your products and introduce them to the market, there’s no ignoring the fact that private label manufacturing has been changing the game lately. There are now more private label products out there than ever before, with many experts declaring that this poses a huge threat to branded goods.
With all of this in mind, it’s important to thoroughly think about your options when it comes to deciding which route to take for your business. If you’re still on the fence line, read on as FLPL discusses the pros and cons of both private label and branded products so that you can make the right choice.
Private Label vs. Branded Products: What’s the Difference?
If you’re still coming to terms with the various manufacturing options out there, let’s start from the very beginning…
Branded products are products that are manufactured and sold by the same company. If you wanted to do things this way, you would need to either manufacture your products yourself or source a factory that could handle mass production, with the manufacturing process still being managed and overseen by you.
Private label products, on the other hand, are products that have been manufactured by a third-party company. We’re not just talking about another factory being involved – a private label manufacturer, like FLPL, will help with everything from product development to mass manufacturing to shipping and other logistics. You won’t need to oversee the process yourself as everything manufacturing-related will be taken care of for you.
Private Label vs. Branded Products: Cost-Efficiency
Let’s start with one of the most important factors to consider; costs. If one manufacturing option costs significantly more than the other, yet you’re on a very tight budget, there may not be much of a decision to make!
When it comes to initial investment, private label products tend to be the lower-cost option. This may seem unusual since you’ll have the extra expense of paying for your private label manufacturer’s services but, even then, private labeling tends to work out much cheaper because of all of the other cost reductions you’ll make. From research and development to the manufacturing process itself, you’ll be making big savings in a number of areas.
On the other hand, the initial investment into branded products is huge. This is often a big stumbling block for small businesses, which is one of the reasons why private label manufacturing has become so popular. Not needing to take out such big loans can be a huge help at the start!
In the long run too, private label products can often provide better profit margins. While these products used to be considered generic, there are now so many premium private label brands out there, and they’re really thriving!
Private Label vs. Branded Products: Exclusivity
Many businesses immediately dismiss private label products because they believe that this reduces exclusivity. They want a product that is owned solely by them…and rightly so!
While branded products definitely meet this criteria, private label products do too. Although you’ll be working with a third-party company to develop and manufacture your products, the rights to and ownership of those products are still 100% yours, just like they would be if you had manufactured them yourself.
Therefore, when it comes to exclusivity, there’s no significant difference between private label and branded products, so don’t allow any misconceptions to sway you!
Private Label vs. Branded Products: Risk Involvement
While risks are unavoidable to a certain extent when running a business, it’s imperative to keep these to a minimum. However, with branded products, the risk that you’ll be taking is much greater. Not only will your initial investment be higher, making it even more devastating should your products not sell, but you’ll also be taking more risks with the manufacturing process. Unless you already have plenty of experience in this area, there’s so much that can go wrong with every tiny decision that needs to be made.
With private label manufacturing, your risk involvement is immediately lower. So long as you pick the right private label company, you’ll be working alongside an experienced team who will have done all of this many times before. They’ll know what works and what doesn’t, saving you from making costly mistakes. This also helps to negate the risk of your product not doing well. Work with a company like FLPL and your business will be propelled to success!
Private Label vs. Branded Products: Brand Identity
There’s no denying that good branding is vital for any business. So, if you want to capitalize on this and go all out with your own branding, then this means that branded products are the way to go, right?
Not necessarily. Once again, this is an area where many think that there’s a big difference between private label and branded products, even though there isn’t. Both options put you in full control of your branding. You’ll be able to create your own unique brand and market it in any way you desire.
With that said, there is one big difference between the two…
With branded products, you have to either be a branding whizz yourself or you’ll need to hire someone to focus on your branding. However, with private labeling, some private label manufacturers, like FLPL, can help with branding and marketing. In fact, we’ll help with packaging too. With branded products, this is a whole additional area that you’ll need to worry about. From designing your packaging in a way that adheres to your branding to finding a company to manufacture said packaging without breaking the bank, life can definitely be a lot more complex when you’re selling branded products.
Private Label vs. Branded Products: Flexibility
It’s important for a business to be relatively flexible. You want to be able to adapt to changing consumer demands and market trends. This doesn’t mean that you should completely overhaul your business based on what could be a market whim. However, you also don’t want to miss out on a major trend because you weren’t able to produce competing products in time.
Unfortunately, this is often the case for businesses selling branded goods. Their manufacturing methods will be geared toward their existing products, making it difficult to quickly change this. Say, for example, your business sells hair care products but you want to expand into heated styling tools. This would be a whole different manufacturing ballgame. Not only would you need to work with new product developers but you’ll likely need new factories too.
With private label products, on the other hand, flexibility is much easier. If you wanted to incorporate hair tools into your hair product line, all you’d need to do is tell your private label manufacturer! They’ll already have the contacts and resources in place to make everything happen on the double. This is why private label products tend to have a much shorter lead time, which is hugely beneficial to any business. It also gives private label brands an edge over branded brands, as they’re able to get new products to market much sooner.
Private Label vs. Branded Products: Quality Control
Quality is everything in this day and age. While consumers still want value for money, they also place great importance on quality. This leads many businesses to assume that branded products are better. After all, this gives you full control over every aspect of the manufacturing process. This means that you can oversee quality control at every stage, right?
If you’re a large business with an experienced team dedicated to quality control, then yes. However, for everyone else, how much do you really know about manufacturing quality control? If your knowledge isn’t all that great, it would be best to leave quality control to people who know what they’re doing. This is where a private label manufacturer comes in. At FLPL, for example, we ensure that every step of the manufacturing process adheres to our high standards. Our quality control measures and procedures will encompass your products too, saving you from having to worry about this.
Private Label vs. Branded Products: Convenience and Ease
As we just mentioned, with private label manufacturing, you won’t have to deal with the stress that quality control comes with. Of course, this isn’t the only manufacturing aspect that’s stressful! When producing branded products, you’ll likely feel a burden every step of the way, from trying to source the right factories and negotiating a good deal to worrying about shipping delays and rising warehouse costs. Take the private label route and so much of that stress will immediately be taken away.
The fact that private label manufacturers make it so much easier for a new business to get started is another point in their favor. Even if all you have is a rough idea, a good private label manufacturer will be able to flesh that out and create some show-stopping products for you. Some, like FLPL, can even help you to market and sell your products too!
Private Label vs. Branded Products: Which is Best for Your Business?
So, when it comes down to it, which is best for your business? Should you find a private label manufacturer to work with or should you attempt to take everything on yourself?
Unless you already have contacts in all of the right places, as well as access to plenty of funds, private label manufacturing tends to be the fastest route to success for a business, especially a young one. It offers so many advantages when compared to producing branded products, making it hardly surprising that private label products are starting to take over the market.
Want to find out more about how FLPL’s private label manufacturing services could help to give your products the edge that they need? Click here to contact us today!
