White label products are often confused with private labeled ones. While they do share some characteristics, that does not qualify them to be used interchangeably. How different are White Label Products from Private Label Products? Read full review.
Before we point out the stark contrast between the two, let’s discuss the similarities between white label and private label products:
– Both the products are manufactured by a third party using its own production equipment and machinery.
– The control over the marketing strategies for both types of products rests in the hand of the company that sells the products.
Both types of labels have significant fundamental differences that set them apart.
The term white label is derived from the fact that any company can put their tag on a blank white label of an already existing product. On the other hand, private label products can be customized to suit the buyer’s demands.
Here are a few key differences between the two
The biggest differences between private label companies and white label companies and products are exclusivity. Under private labelling, the seller gets to customize the product as per their convenience for a unique concoction, whereas white label buyers get a pre-built solution which they then label as their own.
This also means that the exact same white label products by different companies can essentially be sold under different brandings with different names.
In general, privately labelled products tend to be more customizable than white labelled products as they private labelling as a model allows the seller to send a specification of their liking to the manufacturer.
The costs associated with private labelling tend to be higher than white labelled products since there is more research involved for the product to be developed. Customizations and uniqueness are the main reasons for this extra cost. White label companies tend to save money in this department as they do not spend on the development process.
– Reaching the Market | White Label Products
When it comes to entering the market, a white labelproducts takes less time to do so as the products are already manufactured and ready to go. In the case of private labelling, a product needs to be designed and manufactured after the seller gives their nod.
Both private labelling and white labelling are effective methods of market penetration for small businesses. It all boils down to the requirement and interests of the seller.