National brands vs private labels

National Brands are products that are produced under a brand name owned by the producer or distributor, as opposed to private label brands that carry the name of retailer. Private label producers can offer lower prices because they avoid the cost of marketing and advertising that would be needed to create and protect a national brand. The retailer benefits from being able to control quality and reliable supply. In addition a major spinoff of having a private label is the chance for retailers to create their 'own' customer loyalty. If a customer buys a private label product and loves it, they will keep returning to that retailer for that product because they cannot get it anywhere else. This could also prompt them to try other products in that private label range, sustaining loyalty even further.

Private Label brands account on average for about 18% of total sales in South African retail and looking at the rest of the world as a benchmark will continue to grow. Private label brands account for as much as 50% of sales in Europe. The quality of private label brands is up there with national brands with many retail groups enforcing world food safety standards on their private label manufacturing partners and making statements such as “same quality for less money” or “same as the best for less”.