Why Private Label Brands Are Gaining Ground

Private labels at your supermarket —also called store brands—are no longer just a budget-friendly option on the shelf. These are products developed and sold by retailers under their own names, like your local supermarket’s in-house snacks or pantry staples.

Once seen as a lower-cost alternative to big-name brands, private labels are now getting serious recognition for their quality. In fact, more and more shoppers are discovering that store brands often match—and sometimes even beat—the national brands in both taste and value.

As consumer trust grows, private labels are quickly becoming a go-to choice in every aisle.

In a time when shoppers are more budget-conscious than ever, private labels offer unbeatable value without compromising on quality. It’s no surprise that more consumers are reaching for them first. Trusted, affordable, and increasingly premium—private label is no longer the alternative. It’s the new standard.

Private label brands have evolved from being seen as a cheaper alternative to becoming a significant force in the grocery industry, offering value, quality, and innovation that resonates with consumers, notes Grocery Dive ^(1). 

“Numerator, a data and tech company serving the market research space, has published its updated Private Label Trends Tracker, which provides an ongoing look at private label performance across product sectors, channels, and retailers, as well as consumer sentiment from verified buyers of store-brand products.” ⁽²⁾

“Nearly all U.S. households purchased private label products in grocery, health and beauty, household, and home and garden categories over the last 12 months, and private label products accounted for 24% of total units sold across ten major product sectors.” ⁽²⁾

“Club stores saw the largest private label share based on total units sold. Private label items accounted for 33.1% of the Club channel (e.g., Costco, Sam’s Club), followed by Office (30.3%), Mass (e.g. Target, Walmart, 28.0%), Home Improvement (26.8%), and Pet (25.5%)” ⁽²⁾

“Eight in 10 units sold at Aldi were private label products. Among 20 of the largest U.S. retailers, Aldi and Trader Joe’s rely most heavily on private label products, with their owned-brands accounting for 80% and 69%, respectively, of their overall sales volume. Costco (34%), Sam’s Club (33%), HEB (33%), Walmart (30%), Dollar Tree (29%), Lowe’s (28%), and Kroger (27%) also see more than a quarter of their overall sales volume come from private label products. Only 3% of Amazon’s sales volume is attributable to private label.⁽²⁾

“Grocery store brands have always offered a more affordable alternative to customers. Over recent years, private labels have drastically soared in popularity. Store branded products now hold approximately 19.5% of the market share in the United States.“ ⁽³⁾

“Cost-effectiveness is a primary benefit that increases profits due to overall lower costs. By outsourcing private label production, you save money on manufacturing. Your company does not have to incur additional labor, energy, or property expenses.” ⁽³⁾

“Fortunately, you have options where you can outsource private label production. Finding a company to manufacture your store’s products is a much better option.” ⁽³⁾ 

Key points of private label brands in supermarkets:

• Low Priced Options – Mediterranean Fine Foods (MFF) has stocked on-hand inventory for food service order fulfillment. Our products available in up to 5 Gallon HDPE pails

• Quality and Price Balanced Mix- MFF has reasonable prices for your needs and SQF certified for food safety. Food safety and quality systems in place to ensure high quality product and packaging.

• Tailored Products ex: organic, vegan etc.- MFF offers options such as gluten free, no nitrites, antibiotic free chicken - a reasonable cost for supermarkets to use their sausages and snack foods for private labelling purposes.

• Can control production companies can set the pricing and visual identity for their products. MFF has fully customizable labels with flexible retail packaging and food service sizes available. Standardized weights or catch weights of 1 lb. & 5 lb. packages.

o   Product size variations:

o   16 oz and 32 oz jars

o   5 Gallon HDPE pails

o   3 oz – 2 lb. clear plastic bags

o   Cryo-vacuumed packages

o   Roll stock including semi-rigid film applications

• Inflation trends - Private labels, are a good option during periods of high inflation, as consumers focus on value. MFF has added value in their markets by keeping their costs reasonable for vendors.

The explosive growth of private labels shows no signs of slowing down—now’s the time to buy for private labelling. Offering your customers high-quality sausages and snack foods builds brand loyalty and drives sales. Outsourcing production for private label goods is both a cost-effective and widely used strategy. There's never been a better moment to launch or revamp your store-brand offerings.

In conclusion, private label brands have evolved from being seen as a cheaper alternative to becoming a significant force in the grocery industry, offering value, quality, and innovation that resonates with consumers, notes Grocery Dive. ⁽¹⁾ 

Collaborate seamlessly with our products as a private label from Mediterranean Fine Foods to bring sausage and snack food products to market faster. You will enlarge market share, speed time to market and strengthen your pipeline.

Contact us today 508-217-7000 or sales@medfinefoods.com or learn more at www.medfinefoods.com.

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⁽¹⁾ Grocery Dive

⁽²⁾ Walmart owns the top 5 private label brands https://www.supermarketnews.com/private-label/walmart-owns-the-top-5-private-label-brands 

⁽³⁾ Why More Grocery Stores are Switching to Private Label https://www.originaldesserts.com/why-more-grocery-stores-are-switching-to-private-label/#:~:text=Deciding%20Between%20One%20or%20More,and%20a%20third%20for%20food.