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Private label is a partnership between retailers and manufacturers

Issue 1 / 2, January / February 2019

Date: 12/02/2019 Comments: 0
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Private label is a partnership between retailers and manufacturers

Interview with Mr. Brian Sharoff, President PLMA

PLMA - The Private Label Manufacturers Association is a non-profit organisation founded in 1979 to promote private label. It is the only organisation of its kind, representing more than 4,400 member companies around the globe. Membership ranges from multinational corporations to small family-owned companies. Their products include food, beverages, snacks, health and beauty, household and kitchen, DIY, and personal and leisure products. Some manufacturers only do private label. Others are well-known brand makers who also have private label operations.

PLMA presented its first trade show in the United States in 1980, its first trade show in Europe in 1986 and its first trade show in Asia in 1994. Today, it provides services to member manufacturers in more than 70 countries. In addition to two annual trade shows in Amsterdam and Chicago, PLMA also offers conferences, executive education programmes, market research, studies and publications.

Mr. Sharoff, Private labels have been heading upwards in the past few years worldwide. Can we say that branded products, as we know them, are at risk?

No, I don’t believe that the two are related. Private label has grown in popularity as retailers expand their product assortment, create exciting packaging and commit themselves to high standards of quality. The problems that A-brands face are unrelated. In many cases, A-brands have relied on out-of-date product concepts and have ignored important consumer trends like organics, natural and fresh. Retailers have been far more attentive to shopper interests and, accordingly, private label has succeeded.

How did PL change the consumer way of thinking?

Consumer attitudes toward private label have dramatically improved over the past 15 years as a result of better product concepts, higher standards of quality, more exciting packaging and more aggressive advertising and promotion.

What is PL – cheap products with low quality, diversity of products with different quality or marketing strategy for retailers to gain advantage over their suppliers?

Private label varies from retailer to retailer as their management evaluates their audience of consumers and offers products that cater to their shoppers. In the past, this has included low priced, low quality. However, it is now very clear that low price/low quality does not build loyal customers. Instead, shoppers want good quality and assortment at reasonable prices and recognizable savings.

What are the latest trends that you observe regarding PLs?

The latest trends cover many different product categories. In general, consumers want more emphasis on fresh and natural ingredients. They also want labels that are easy to understand. Perhaps most important is what they don’t want: they don’t want to spend long hours in the kitchen preparing meals. They want foods that are easy to prepare. In some cases, this means microwaveable or at the very least ready-to-heat and ready-to-serve.

You organise the biggest trade show for PLs - World of Private Label. Tell us why it is important for a producer or a retailer to attend the show at least once?

Private label is a partnership between retailers and manufacturers. It is necessary to see what are the latest product concepts, who are the best suppliers, what are the most trends. You cannot find out the answers sitting behind a desk at the company office. PLMA’s trade fair was organized to help both retailers and manufacturers understand their industry.

Аre there any Bulgarian companies that take part in the show and how many are they?

There are 30 companies from Bulgaria in the show and 377 from Central and Eastern Europe.

What is your forecast about PL`s market developing?

Based on reports and analysis of leading consulting companies, private label is expected to grow substantially over the next 3-5 years. This will vary from country-to-country but the growth is based on demographic, social and economic trends taking place across all of Europe.

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