Many businesses are growing their businesses by taking advantage of growth opportunities in private labeling.

It can be positive revenue-wise for the supplier as well as the retailer.

How it works:

Private-label products are manufactured in order to be offered under other businesses’ brand. This means companies of all sizes enjoy the prestige of selling products with their own logos.

Essentially, companies are able to reinforce their brands. Private labels enable small businesses to appear more professional.

In addition, big retailers, in particular, are able to satiate economy-minded consumers because they’re able to sell private label products at lower prices.

Conversely, manufacturers enjoy higher revenue by privately labeling products for companies. They do all the work so their customers receive finished products to sell.

The downside for manufacturers is their private-label profit margins are usually thin, so they have to make up the difference in higher volume.

And thanks to private labeling, corporate gift market is huge in Q4.

How can you get started in private labeling? Start with your existing customer base by offering to private label products for them. This will enable you to build a track record.

For information, Google the term, private label, and you’ll discover several million search results. There’s also a national organization – the Private Label Manufacturers Association.

Indeed, there are pitfalls to avoid.

Here are six basic tips:

1. Establish controls

If you make your own product, such as a wine, you don’t need to outsource.

Otherwise, outsourcing is very popular. But whether you manufacture your own products or outsource the work, be diligent about the process.

If you outsource, research the supplying company for ethics. You don’t want to risk the company leaking product designs to counterfeiters.

2. Insist on consistency

It’s imperative to use the same ingredients and processes to exact specifications.

3. Partner with your supplier

You should avoid manufacturers who also provide for your competitors. Get an agreement in writing.

Research your competitors with similar products to help you split profits and establish a wholesale price.

Consider choosing a manufacturer that can help you develop a marketing budget – from research and design to packaging, branding and timelines.

4. Select a nearby manufacturer

Location counts to save time in shipping.

5. Get a good private-label attorney

There many protections to seek not the least of which is trade-marking, patents or copyrighting.

Laws vary from state to state. Make sure you have the right information for the creation, launch and distribution of your products.

Get stellar counsel to prevent intellectual property infringement or counterfeiting of your products.

There are countless private-label sellers. With globalization, the number of private-label sellers will only continue to increase.

6. Be diligent if you sell on platforms such as Amazon, Etsy or eBay

Know the guidelines in the brand registry services as well as their terms of service.

If you encounter counterfeiting on the platforms, be empathetic with the platforms’ personnel. In making your case, don’t be emotional and petty. State your case using their terms of service rules with concise arguments and unambiguous evidence.

From the Coach’s Corner, recommended reading:

4 Tips to Protect Your Business with a Trademark — The last thing you want as a business is for your company logo and name to be stolen. The trick to avoid such a travesty is to be trademarked by the United States Patent and Trademark Office.

Risk Management – Lawyer Explains Basics in Protecting Intellectual Property — Entrepreneurs are well-advised to consider ways to avoid legal entanglements over their inventions and intellectual property.

Best Practices to Protect Yourself in a Business Partnership — Business partnerships often end in catastrophes because they’re not based on solid legal foundations. Here are five best practices in due diligence for your protection.

“Where there is a will, there is a lawsuit.”

-Addison Mizner


Author Terry Corbell has written innumerable online business-enhancement articles, and is also a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.