Price-Conscious Shoppers Spur Private-Labels

Kiplinger:

Retailers are enticing price-conscious shoppers with private-label goods. As consumers tighten their purse strings, store chains are luring them to spend more dollars in one place with appealing branded products not found in other stores.

As other retailers have discovered, private-label goods can lure customers back into store aisles. Twenty years ago, shoppers bought 95% of their groceries in traditional markets, compared with only about 65% today, says Brian Sharoff, president of the Private Label Manufacturers Association. The rest of the purchases have migrated to nontraditional sources of groceries, such as Wal-Mart Supercenters, smaller organic grocery store chains, even 7-Elevens.

The trend spells opportunities for big and small suppliers. The private-label partnerships make it easier — and cheaper — for manufacturers to get their products prominently displayed on store shelves. “In terms of true growth, it will be driven by innovation and private-brand launches that are truly unique,” says Stern. “They can’t be just copying programs.”

Photo by racked.com.

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