Market Effect of Private Brand

Private brand is a commodity brand created and operated by commercial retail enterprises themselves. In recent years, large international commercial enterprises generally adopt their own brand management strategies to enhance their reputation by building their own brands.

Finally, the efficiency of this enterprise is improved and the enterprise develops better. The successful implementation of private brand is the British Mars Department Store Group, in which all products use the company's own brand-"Saint Michael" brand, which is known as the world's largest "factory-free manufacturer". A survey in the European market shows that 17% of all retailers used their own brands in 1980. In 1988, the proportion has risen to 23%, and now it has exceeded 40%, and the development of retail own brands is accelerating.

High quality and low price is a great advantage of private brand goods. According to statistics, the prices of goods that commercial enterprises use their own brands are generally lower than those of similar goods by more than 30%. The reason why the goods using own brand have price advantages is mainly because: first, the goods produced and sold by ourselves save many intermediate links, saving transaction costs and circulation costs; Second, the use of private brand goods can reduce advertising fees, and the good reputation of retailers is the best advertisement for private brand goods; Third, large retail enterprises have many stores, and mass production and sales can achieve economies of scale and reduce the cost of commodity sales.