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Advantages and Disadvantages of Private Label Products

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I have a chain of grocery stores. In those stores I carry manufacturer's brands of paper goods, such as Bounty paper towels, Charmin bathroom tissue, Kleenex facial tissues, etc. I have been thinking of having my own private label brand of paper goods to sell in the store, such as Keith's paper towels and Keith's facial tissues, but I'm not sure what to do. I decide to hire you as a consultant to help me with my decision. Write a report outlining the advantages and disadvantages of carrying a separate line of private label products.

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Solution Summary

This very detailed solution discusses the benefits and drawbacks of adding private label to a grocery store chain. It includes examples.

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Private label can be a great way to increase profit and drive more customers to your store exclusively. Advantages of private label include the ability to specify quality and price for your product. This is important in that it helps customers associate your store brand with your store. In the 1980's Loblaws out of Canada was revolutionary in carrying top quality President Choice products that exceeded customer's expectations. Their chocolate chip cookies promised more chocolate chips than the competitors, and they did blind taste tests with their President's Choice soda ...

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Sally Baldwin, Ed.D
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  • BA, University of Southern California
  • MSS, United States Sports Academy
  • Ed.D, Boise State University
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