Food & Beverage industry review Q3-2007; RSM EquiCo Capital Markets

Private Label Goods Gaining on Brands in Supermarkets

As retailers' private labels increase in numbers, quality and sophistication, consumers are increasingly choosing store-branded products over other consumer brands. An article in the on August 29 quoted Neilson data that indicated private label food and non-alcoholic beverage sales rose 4.3%year-over-year in mass-market outlets for the 52 weeks ended July 14, while sales of branded products in the same categories rose only 2.2%. Retailers are continuing to show strong sales of traditional “knock-off” products, though much of the gain in sales is coming from retailer-exclusive brands (products only available at a specific retailer's stores, with names and logos completely separated from the retailer). Major brand companies are expected to strongly defend their market positions with improved product quality and packaging, as well as greater convenience. Read More.