KerryDigest Full Scoop:
Private label has become increasingly more relevant in recent years. According to PLMA’s 2024 Private Label Report, store brand sales reached US$236.3 billion in 2023, an all-time high. Cost-conscious consumers looking for less expensive alternatives to national brands, retailer control and branding, and a growing trend in the premiumisation of products has led to significant growth in the private branding market.
In this article, we’ll highlight current trends in private label, what the top growing categories are, the role premium private label plays in the market, and the future/continuous innovation of private label. Overall, private label is a growing sector of the food and beverage industry, offering benefits to both retailers and consumers alike.
Categories
| $ Sales (in billions)
| Private Brand (PB) Share
| PB $ Growth
| National Brand (NB) $ Growth
|
Fresh Meat
| $16.53
| 26.9%
| +3.7%
| -0.2%
|
Paper & Plastics
| $12.87
| 42%
| +7.5%
| +3.1%
|
Cheese
| $9.42
| 44.4%
| +4.7%
| +2.2%
|
Vegetables
| $9.17
| 23.9%
| +3.7%
| +1.1%
|
Beverages
| $8.92
| 11.5%
| +9.4%
| +6.9%
|
Current Private Label Trends
Private Label is Creating Value
Value focus: Economic challenges are driving consumers to seek budget-friendly options, making private label more attractive – especially for those consumers concerned about food and gas prices. There are several reasons consumers find value in private label products: 57% of consumers think private labels offer good value for the price, 43% buy them to save money, and 29% think they are just as good as name brands, according to recent data from Numerator.
The top 20% of American earners control more wealth than the nation’s entire middle and low-income classes combined, federal data shows. As income disparity continues to increase, private branding low-cost alternatives have and will continue to appeal to those hoping to save money at their local grocery store.
Retailer innovation: Retailers like ALDI are leading the way in growth due to lower prices, which are directly related to its small store footprints, large private-label selection, and fewer employees. For example, they’re able to keep products in the boxes they were delivered in, carrying an average of only 1,650 items compared to the 31,530 carried by traditional supermarkets. ALDI states that they can take all its buying power and put it into the most popular items which a customer might buy, allowing the company to deal directly with manufacturers, and receive the best cost prices.
