Private label becoming premium

Wang Yanlin
Forum at the 2019 Shanghai Private Label Fair told of great potential for the sector in China as its sheds the stereotype of being cheap and offers higher quality at lower prices.
Wang Yanlin
Private label becoming premium

Visitors are seen at the 2019 Shanghai Private Label Fair which runs until Thursday. 

Private label products are becoming more premium in Europe and the US, providing a clue for the growth of the sector in China, according to participants at the China Private Brand Summit Forum in Shanghai on Tuesday.

The forum was part of the 2019 Shanghai Private Label Fair, which runs at the Shanghai New International Expo Center until Thursday.

Private label products are brands that carry the name of retailers, especially supermarkets and hypermarkets. Because middlemen are eliminated, private label prices are very competitive — an effective way to offer consumer products of higher quality but at lower prices.

“In Europe and the US, private label has shed the stereotype of being cheap,” said Leonique White, director of International Trade at Private Label Manufacturers Association.

“Instead, they moved into the ranks of premium and even super premium products in terms of quality and packaging to meet the demands of adventurous consumers,” White said.

She said the reliability of retailers gives consumers confidence in buying high-priced private-label products, which are still of great value.

In Europe, private-label products account for about 35 percent of all goods sold. But in China, they are less than 5 percent of sales. In big cities like Shanghai, the proportion is higher and people have a growing awareness of private label, according to the Shanghai Licensing Association's private label specialty committee.

Alex Reuts, private label chief inspector at Daymon Worldwide, said China has huge potential for the growth of private-label products because only 3 percent of consumers in China had never bought such products and were unwilling to do so due to concerns of quality and low awareness. In contrast, 94 percent said they wanted to give it a try.

The annual fair has exhibitors from 42 countries and regions displaying their products in over 2,000 booths, an increase of 59 percent from a year earlier.

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