Yizhou Chen’s Post

Expanding into new product categories can be a real headache for grocery brands! From managing supply chains to understanding consumer preferences, the challenges are aplenty. This insight serves as a valuable reminder for industry players to approach expansion strategies with caution and thorough planning. Ready to tackle the challenge? Dive into the full article for expert insights and tips! #retail #storebrands #peergroups

A recent study by #FMI reinforces the power and potential of private label. 53% of consumers say that private label is important in determining where they shop, something consistent a cross different studies. BUT, that sentiment has 𝒈𝒓𝒐𝒘𝒏 𝒎𝒐𝒓𝒆 𝒕𝒉𝒂𝒏 50% 𝒔𝒊𝒏𝒄𝒆 2016 - up 18 percentage points. Put in context, more than 𝟓𝟎 𝐦𝐢𝐥𝐥𝐢𝐨𝐧 𝐦𝐨𝐫𝐞 𝐀𝐦𝐞𝐫𝐢𝐜𝐚𝐧 𝐜𝐨𝐧𝐬𝐮𝐦𝐞𝐫𝐬 look at a retailers' private label offer when determining where to shop. What is your retail strategy for private label? Reach out! We at PDG Insights are here to help. #privatelabel #storebrands #grocery #groceryretail #retail #productinnovation Great work to the FMI- The Food Industry Association team! Steve Markenson Allison Febrey

Learn how private label beverage can help you win in this cut-throat industry 👇 👇

𝗠𝗮𝗷𝗼𝗿 𝗿𝗲𝘁𝗮𝗶𝗹 𝗰𝗵𝗮𝗶𝗻𝘀 𝗮𝗿𝗲 𝘄𝗶𝗻𝗻𝗶𝗻𝗴 𝘄𝗶𝘁𝗵 𝗣𝗿𝗶𝘃𝗮𝘁𝗲 𝗹𝗮𝗯𝗲𝗹 𝗕𝗿𝗮𝗻𝗱𝘀 - 𝘄𝗵𝗮𝘁 𝗰𝗮𝗻 𝘆𝗼𝘂 𝗹𝗲𝗮𝗿𝗻 𝗳𝗿𝗼𝗺 𝘁𝗵𝗲𝘀𝗲 𝗯𝗶𝗹𝗹𝗶𝗼𝗻 𝗱𝗼𝗹𝗹𝗮𝗿 𝘀𝘂𝗰𝗰𝗲𝘀𝘀 𝘀𝘁𝗼𝗿𝗶𝗲𝘀? It's almost comical how all major retail chains have created their own private label brand, or incorporated private label into their core principles. But, we must look at the massive success of these brands to see the gigantic potential: - The PLMA reports a 10% CAGR growth in sales of private label products in 2023 - Target's Good and Gather brand reached $3 billion sales in 2022 - Walmart's Great Value brand earned a whopping $27 billion revenue in 2020 These brands have successfully leveraged the core benefits of private labeling, to create a distinct competitive edge. - 𝗖𝗼𝘀𝘁 𝗼𝗽𝘁𝗶𝗺𝗶𝘇𝗮𝘁𝗶𝗼𝗻: Using private label means no production facility and no initial investment. This, in turns, lead to lower prices for consumers (like Walmart's Great Value) - 𝗣𝗿𝗼𝗱𝘂𝗰𝘁 𝗱𝗶𝘃𝗲𝗿𝘀𝗶𝘁𝘆: By working with private label suppliers from around the world, brands can offer unique products that can't be found anywhere else (like Trade Joe's) - 𝗖𝘂𝗿𝗮𝘁𝗶𝗻𝗴 𝗮 𝗱𝗶𝘀𝘁𝗶𝗻𝗰𝘁𝗶𝘃𝗲 𝗯𝗿𝗮𝗻𝗱 𝗶𝗺𝗮𝗴𝗲: Organic grocer Erewhon filled their stores with Erewhon store brand products, to create a life-style elevating shopping experience - 𝗦𝗵𝗼𝗿𝘁 𝘀𝘁𝗮𝗿𝘁-𝘂𝗽 𝘁𝗶𝗺𝗲: We all know PRIME, an energy drink launched via an influencer and private label collaboration. In just a year, PRIME exploded to become one of the most popular energy drinks in the US There are even more success stories from private labeling. These companies are successfully navigating current economic downturns, and overtaking traditional brands in customer mindsets. But the window of opportunity is closing. Good ideas are running out!! Right now, the secrets of private labeling are slowly being revealed to the world. Many start-up beverage brands are now leveraging the power of private label beverages to win new markets. We can help build your success story in the beverage industry, with our state-of-the-art private label beverage service. So contact us now to start your success story today!! Read more: https://lnkd.in/gja9myet #privatelabel #oem #beveragemanufacturer #beverage #storebrand #tandobeverage

👍 Target's adaptation and development. An example of resilience in uncertain times. Just read this part here: "Private label, in particular, has become a key growth driver for Target.. Good & Gather, which launched in 2019, now rakes in nearly $4 billion in annual sales." according to Catherine Douglas in the article below.

An article on Target's Groceries Approach. ✍️Summary: Target's grocery business has grown significantly, reaching $24 billion in sales, with food and beverages now in over 55% of shopper baskets. This growth is driven by a strategic focus on private labels like Good & Gather, which alone generates nearly $4 billion annually. Target's shift from merely selling to celebrating food, alongside digital sales innovations, has revitalized its grocery segment. The retailer's efforts to offer competitive pricing and exclusive partnerships further enhance its market position. 🌟 ⁉️Why This Matters: Target's success underscores the importance of private labels and digital transformation in retail. As global retailers face rising costs, Target's model offers a blueprint for balancing quality, affordability, and consumer engagement. However, challenges such as supply chain disruptions and maintaining brand differentiation remain. Solutions include from aligning global partners, investing in resilient logistics and continuous consumer insights to adapting offerings, which means flexibility. 🔗 Follow and connect with Adad Chaul, MFin for more insights and visit www.o-ibf.com for global retail sourcing partnerships and provate label developments. How can other retailers emulate Target's success in grocery sales? #RetailInnovation #PrivateLabelSuccess #DigitalTransformation #GlobalRetailStrategies

"Today’s customers expect more from the private brands they purchase – they want affordable, quality products to elevate their overall food experience." Smart move by Walmart. TBH, I'm surprised it took this long to learn the lessons from Target's Good & Gather, Kroger's #SimpleTruth, Whole Foods Market 365, and all of Trader Joe's. The US has long been a laggard in premium private food brands. Private label market share (units) was 21% in 2023 (vs. 35-40% in Europe), and with food prices up by ~35% since 2019, consumers are looking to save wherever possible. Most retailers need more than a "private brand strategy." They need to: (1) Treat their private brands as real brands. (A good rule-of-thumb is if you can sell them to another retailer.) (2) Re-work their business operating model (especially the E2E product and merchandising processes) to support both owned and third-party products. And to do this, many will have to take back store merchandising, much of which has been ceded to category captains. https://lnkd.in/esXFFWMh

Will Walmart's New Better Goods Premium Grocery Brand Succeed? The WSJ reported today that Walmart will introduce a new private label premium food line called Bettergoods this year. The line will include gluten-free muffin mix, oat milk ice cream, curry chicken empanadas and cardamom rose raspberry jam. Most if the items will retail around $5. The natural question to ask is why is Walmart doing this now and will it succeed? A few observations: 1. Its the Core Stupid! Grocery is important to Walmart, constituting 60% of sales and it really wants to maintain relevance in the category. 2. It is a Catchup game: Walmart is playing catch up. Target pioneered selling Private label goods in soft goods category and then in Groceries. Today Target has over 45 brands of Private label goods in groceries, a feat that only target can pull off. Cost's Kirkland accounts of sales. 3. Sams Choice is Being Rebooted: Walmart has always had a so called premium line of private label products called Sam's Choice. However, this line really did not have a raison d'etre. 4. Does Adventurous Eating provides the raison d'etre? According to Walmart executives, adventurous eating has become mainstream and perhaps this provides the raison d'etre that Sam's Choice lacked. 5. Will Curry Chicken Empanadas Sell Everywhere? Scale is important to a mass market retailer like Walmart. The hope is that curry chicken empanadas will sell everywhere. 6. Sample, Sample Sample: Walmart executives note that products in transparent jars will sell better. Maybe what they are alluding to is the customer need for sampling for a product that does not have the power of a national brand advertising campaign. But note that Trader Joes and Costco regulalry sample products. Will Walmart be considering sampling in its product introduction plans? 7. Earn Credibility one Jar at a Time: Private label credibility is earned slowly one jar at time. Without the power of national brand advertising to reinforce the brand, the retailer has to rely on in store merchandising and marketing to promote the product and position the product. These tools are powerful but are only one part of the equation. In store merchandising has great power but with it comes great responsibility. https://lnkd.in/gZ3DYU4V Walmart launched

The current focus on supermarket pricing largely ignores the systemic nature of the supply chain from the farm to the consumer. There are many steps, all of which have an impact on the costs and margins of the enterprises involved. The oligopolist nature of the retail market does have an impact, but it is more on the power that can be exercised through their supply chains than on gouging price from consumers. The supply base to supermarkets is an odd shape. In shelf stable products there is a small number of major suppliers, mostly controlled from overseas, who dominate volumes. They are met by a number of SME’s fighting for the scraps. In perishable markets, the situation is not quite so pronounced, but the pattern remains. The number of retailers has significantly reduced over the years, as has the number of suppliers, particularly those that are domestically owned. Similarly, the number of proprietary brands has been reduced to a handful from many. They have been replaced by housebrands, and category rationalisation to reduce transaction costs, and transfer proprietary margin to the retailers. The consumer puts a dollar into the system when they make a purchase. The rest of the game is a fight to the death for a share of that dollar. A few press releases and enquiries will never address these systemic challenges that have evolved over 50 years. #supermarkets #supermarketpricing #fmcgindustry

Great insights from BCG on the importance of supermarkets adopting the "Strength Finders" playbook. The article also emphasizes the growing success of discounters with today's value-focused and enlightened consumers. #Supermarkets #Discounters #ValueFocused #Consumers Schmidt Market Research