Private Label: Who wins?
Posted by admin on December 10, 2011
The NBN has done numerous studies on the impact of private label products that mirror branded products.
There are three parties who split the “pie”:
- Customer (account, not consumer)
- Canada Bread
So, when a Private Label product is launched, who wins?
Canada Bread is the big winner. Their profit margin increases substantially, while Franchisees lose almost 50% of their revenue compared to the branded product counterparts.
When it is on feature that disparity exponentially increases and Franchisees lose significantly more money. Each week this costs Franchisees thousands of dollars.