Private Label Products: How to Find the Best Product
Private Label Products: How to Find the Best Product
Depending on who you ask, starting a new business can be challenging. However, people often think that step one of that process is to develop a new product. However, you'll find that 20% of products on the market today are private label products. That number will continue to grow over the next several years as eCommerce goes with it. So if you want to start your own business, owning a private label is one way you can skip development. But how do you start?
Table of contents
- What is Private Labeling and How Does it Work?
- How To Find Private Label Products
- Where Can I Create My Private Label Brand Line?
- 10 of the Best Private label Products You Can Sell
- Tips for Starting a Small Business That Sells Private Label
What is Private Labeling and How Does it Work?
As a pure definition, private label products are when you are the sole reseller of a product manufactured by a third party.
Private labeling is another form of white label products. White label products are created by one company and sold by another. Private label selling involves a brand exclusively owned by one reseller.
For example, numerous medical companies sell Ibuprofen (i.e., Advil vs. generic brand medicine). This is the white label, but if one company sold Ibuprofen, it would be a private label.
PL products have different strengths and weaknesses:
There are many reasons to create Private Label Brands.
Production Control - Being the exclusive provider of a product line gives you greater control over production. To get control over white label products, you have to be a larger company.
More Pricing Control - Having more production control helps you understand potential profit margins and operating costs. Having this knowledge and production control enables you to know the best price.
Greater Market Control - When drop shipping or going wholesale, you aren't selling your product; you are selling someone else's. Having ownership over a product under your brand means that you can maintain brand loyalty.
You Can Be Fast - By outsourcing manufacturing efforts, you can focus on market research. By specializing your business in marketing and sales, you can be more efficient than other larger companies.
It Is Your Brand - Your brand, your rules. When you have complete control of marketing, design, and optimization, you are accountable to anyone. If you have the skills, you can truly grow a market segment for yourself.
Private Label Products are not always the best choice. Here are some reasons against PL use.
Reliance On A Third Party - Finding a poor private label manufacturer won't help you at all. When you experience shipping delays or suddenly see a price hike, it's hard to negotiate when you need the product.
It Takes Time - When wholesaling, you typically are selling a well-known product with pre-existing brand loyalty. Private brands don't have that loyalty, so you will need to work harder and wait longer to get that.
Less Innovation - While you can eventually build to create product ideas, third-party manufacturers typically won't support you in innovation. Private label brands commonly piggyback on the latest trends, so it's hard to hold the number one slot (sometimes).
Customers Have Low Expectations - People assume that product label products are automatically cheaper because you don't have an internal manufacturer. You will have to overcome that stigma by selecting a good manufacturer.
How To Find Private Label Products
When searching for private label product ideas, your selection of products should come from a few things. Finding ideas come from a combination of aspects:
What are you passionate about selling?
What niche markets do you want to expand to?
What types of products have you been interested in selling?
Having interest is one aspect you can consider. However, creating private label products enable you to target entire market segments.
You might not be enthused about selling water bottles, but it might give you a foothold for selling for your true passion: fitness.
It's vital to decide how you want to help people through your niche and select niches that work.
However, if your ultimate goal is to make money, starting with products that work is crucial. Here are ways you can find those products:
1. Look Through Marketplaces With Analytical Tools
Walmart, Amazon, BigCartel, and all online eCommerce marketplaces have analytical tools available. In many cases, the internal mechanisms are a stepping stone into the wide world of available analytical tools.
For example, Amazon is giant and has numerous third-party tools you can use to see what products work. AMZScout is one such example that includes a product research tool.
If your budget is limited, you might stick to looking at these free alternatives:
Amazon Trend Report - The Amazon Trend Report tells us of a critical area of growth. Because this data comes directly from Amazon, it is worth paying attention to.
The Walmart Sell Better Blog - The Walmart Sell Better Blog comes directly from one of the world's largest physical storefronts. However, Walmart Marketplace (Walmart's eCommerce platform) has seen intense growth, making this blog suitable for new sellers.
BigCartel Store Examples Page - Big Cartel is a design-focused selling company that is great for artists. If you sell clothing (or anything), this example page enables you to get some ideas for what a good site design looks like.
The Various "Top Sellers" Categories - eCommerce marketplaces like Amazon and Walmart have top seller pages. The Amazon Best Seller, Mover and Shakers Category, and Top Product Category sellers are all handy. By seeing what companies have the most growth, you can hit the correct targets.
Using a combination of top seller analysis and featured pages, you can understand what works among the best sites. Understanding this gives you a better idea of how to improve the customer experience.
2. Search Social Media for Trending Topics
When it comes to trending topics, social media is a powerful tool. Here is a list of social media pages and how you can leverage them:
Pinterest - Pinterest is a tool for finding the latest trending topics from a visual front. Those who work in the DIY niche are particularly benefited here, but you can find multiple trends worth following.
Twitter - The trending tab on Twitter includes a portion of what you should target. Twitter enables you to follow specific influencers and overall topics around your preferred niche. Exploring multiple niches provides you with excellent product ideas.
Facebook - Facebook discusses general topics and enables you as a seller to find communities of fellow sellers. While some might be your competition, you'll find that getting connections is one way you can better understand what works with your private label business.
Instagram - Instagram is full of influencers that have product photos you can look at. Instagram is a reminder to target micro-influencers who have small and devoted audiences. Those small-scale influencers tell you of the latest trends and provide you with a way to promote your products.
3. Use Keyword Research to Find High Volume Topics
Keyword research is a before-and-after process for optimizing your product listings. Search Engine Optimization is a great way to push your marketing efforts. The keyword research part of SEO is a great way to find trending topics.
Here are some areas you can target:
Google Trends - Google Trends talks about the latest breakout topics in the world. It is an excellent source of finding consistent search topics and the latest changes.
Google Keyword Planner - Google Keyword Planner is a critical aspect of the Google Search Console. It enables you to see historical data and essential changes on topics. Using historical data is vital to determine long-term success.
Marketplace-specific Keyword Tools - Built-in keyword-finding tools are typically found through the advertising platform of each marketplace. However, using third-party tools will provide you with enhanced information. For example, AMZScout enables you to see the long-term viability of product purchases on Amazon.
When doing product research, it is vital to use tools within your chosen marketplace. If you want to be a Walmart seller, it doesn't make as much sense to use search data from Amazon. However, you might find that inspiration from one online marketplace might provide information on what the other group is missing.
Where Can I Create My Private Label Brand Line?
When choosing the best private label manufacturer, it is essential to know you can trust them. One way you can confirm trust is by going through big-name providers. Below is a list of providers you can choose from.
Alibaba (Sometimes called Alibaba Group) is an international company best known for its private-label potential. The ability to easily purchase pre-made items in bulk enables you to choose from various products that are already there.
Alibaba has a vast market of various sellers wanting your attention. Because the company operates out of China, it's incredibly inexpensive.
Alibaba is one of the most common ways Amazon sellers get started. Alibaba resellers are less common elsewhere, but the potential is still great.
ThomasNet is another major provider known for supporting major American companies like Boeing, 3M, Kraft, and NASA. The company helps over six million products you can search with relative ease.
Much like Alibaba, ThomasNet is a company that specializes in providing a base for other manufacturers. Unlike Alibaba, these Manufacturers are exclusively in North America.
ThomasNet is also great at providing professional service companies with protective wear.
SupplyMeDirect is another well-known manufacturer of various resold products. The marketplace is similar to Alibaba's in the way that they structure the site.
SupplyMeDirect also provides further support for supply chains. However, you will want to ensure quality control for your first few shipments, so be sure it reaches you before it goes anywhere else.
You might prefer them as a private label supplier, as that gives you more control over product quality.
Modalyst is another major company that works in the private label industry. The company integrates with some of the major online marketplace providers (Shopify, BigCommerce, Alibaba, etc.)
Wix has recently purchased the company in an attempt to make its eCommerce offering more competitive. While you will see dropshipping as its primary offering, it does offer a strong private label business.
Integration with multiple applications enables eCommerce specialists to try on various marketplaces through Modalyst.
Quality clothing manufacturers like Hawthorn are hard to come by. This company is one of the UK's number one providers of garments.
This company can be great for providing help with pattern development, prototypes, and sampling. You might find that they cost more than Alibaba or SupplyMeDirect. However, this is a quality private label provider.
If your target market involves selling clothing as a fashion expert, Hawthorn can help you find that space with quality. Don't expect the cheapest products out of them.
10 of the Best Private label Products You Can Sell
Now that we have a list of manufacturers, let's dig into the products worth talking about. There are numerous options for taking advantage of market trends and developing your customer base.
Below are some of the top ten areas you can get into with relative ease:
When it comes to beauty products, Mary Kay provides us with a good base for potential. While you might not desire the same business structure as them, the point is that their business model operates on how inexpensive beauty products are.
Beauty products are a heavily saturated market, but there are many narrow areas. Just on skin tone alone, you've got a million different options for assisting the underserved masses. Skin care is pretty critical as well!
The next time you explore a marketplace, dig through each of their product categories for makeup. If you find an area that you think is underserved (but still gets enough product reviews and sales), you can use this as a foothold to expand.
There is a wide range of pet products for dogs, cats, gerbils, hamsters, and birds. However, there are still microniches and underserved pet populations that don't get as much attention.
Pet toys also fall into the category of baby toys and are small and cheap to manufacture. If the toy breaks, it's easy to blame the animal in question.
Remember that the creation of a unique pet toy can be a foothold. For example, if you want to get into the competitive pet nutrition market, your foothold in that marketplace can start in less competitive areas.
Baby toys are another popular area to get into. Among popular products, baby toys have low product cost, are divided into numerous niches, and give you a good idea of eCommerce basics.
It's a matter of finding out what product category has the least competitiveness. Given the many sub-categories available, this can take quite a bit to find.
However, once you find the right niche product to create, you'll find this is a relatively easy source of income.
Kitchen products are a great area to keep an eye on because prospective buyers are always looking for the new thing. The number of niche fads in this area can get overwhelming, so it is undoubtedly helpful to stay up with the trends.
With kitchen products, it is good to be a bit pickier when product quality. After all, most of these other niches aren't exposed to as much heat.
5. Fitness and Health Products
The Amazon Trend Report tells us of the return of social fitness. Fitness equipment sales are up 55% between March and June of 2020. With the global pandemic slowing down in some areas, people are eager to return to exercise routines.
For many people, this means returning to the gym. Such objects like waist trainers and water bottles are both popular product sub-categories to target.
By paying attention to the latest trends in exercise, you might find yourself surprised at how you can meet high-demand products rapidly. Weight loss is a powerful motivator when getting to that best body.
6. Men's Grooming
A 2019 report from CNBC tells us that the men's personal care market is expected to hit $166 billion next year. With men being more interested in looking good, grooming products are a unique niche. For men, it can be like bringing the spa home.
Relatively newer companies like Dollar Shave Club and Harry's Razors show us how it is done. However, this isn't just left to shaving hair, as men's skincare products are also seeing significant growth. You might even find a market for men's bath balms.
The age of inclusivity is another reminder of how men are exploring sides of themselves previously discouraged. Otherwise, it's another way to avoid going to barbers or salons.
7. Organic Products
Sales of organic products have quickly risen by $30 billion into a $56 billion industry in 2020. Despite how challenging it can be to sell food products, the popularity of organic natural products provides a lot of potential.
Pay attention to the latest organic products at your local grocery chain. By doing so, you can expand that to see how it survives in the eCommerce market.
Dry goods typically do better in this case, as these are the least expensive to ship.
8. Phone Accessories
Companies like Alibaba have a plethora of different designs for phone cases. The iPhone, one of America's most popular mobile devices, is always looking for new designs.
You'll want to be incredibly picky with your target market, as this area can be pretty competitive if you hit the wrong spot. You might find yourself exploring lesser-known accessory targets outside of phone cases when starting.
9. Reusable Shopping Bags
Going back to our organic example, one way of cleaning and keeping the earth is through less plastic waste. By selling reusable shopping bags, you can do your part to appeal to those who prefer organic products.
You might find that reusable shopping bags are missing a feature you can meet. This is where detailed research is essential. This is a big deal in environmentally-conscious countries (I.e., the USA, UK, etc.).
You could be a seller of the next generation of shopping bags.
Clothing might seem like an incredibly oversaturated area, but you'll find that narrow niches in clothing are often underserved. Many of these are from forgotten trends, but small numbers of clothing shoppers still cling to them.
An upfront investment to a private label company to become the product provider is one way to gain significant attention.
Tips for Starting a Small Business That Sells Private Label
Before we end this blog post, here are some quick tips you need to consider before becoming a private label seller
1. Always Check Out Your Supplier
Where there are suitable private label suppliers, there are also bad ones. While all the ones on this list will typically enable you to dispute issues, going with other providers can be dangerous.
Given that many of these private label manufacturers are in China, you'll find yourself struggling to seek any compensation with a poor supplier.
If you are working with a Chinese manufacturer, check these resources out first:
All three will tell you of court information of potential manufacturers. After looking up your chosen company, ask them to send a sample.
If the company is unwilling, move on. It isn't worth the potential of bulk ordering a terrible product.
2. Work With Local Suppliers
If your niche fits local needs, you can ask for local suppliers. The best way to avoid international issues is by avoiding those issues altogether.
For example, if you want to sell on Amazon, you can use the AMZScout Pro Extension to find local suppliers by clicking the "find the best supplier" button.
Local suppliers might have higher upfront costs, but you don't have to pay for shipping. Also, you can resolve issues with more incredible speed.
3. Optimize Your Product Pages
From our previous step on keyword research, you can also use those keywords to optimize your product listings. Optimization involves placing those keywords in the product title and description.
Doing so will enable people who search for your product to find you. You can also optimize for secondary keywords by placing them throughout the description.
Outside of keywords, be sure that your descriptions are detailed, your images are high quality, and your copy is engaging. Nobody wants to buy a product that looks like it comes from someone unprofessional.
Consider it like detailing your car for a sale. Nobody wants to buy a dirty car.
4. Promote Your Products
Last (but not least), you need to remember to set an advertising budget. Even if your product listings hit all the right points, nobody will find you if you don't pay for advertising.
This situation is especially true if you have a young marketplace listing. Almost all online marketplace won't give you a top-ranking position in your first month unless the competition is low. In that case, you probably won't make enough sales anyway.
Always be sure to come in with a competitive budget. Advertising is a necessary part of your product costs.
Conclusion - Why Should I Become a Private Label Seller?
The battle of old-school brands versus private label brands is apparent. Huge companies are being dethroned left and right on online marketplaces because being small and quick has meaning.
Specializing in an area makes you more efficient. Not every company is going to be the best at everything. Trying to be the best at everything is insanity.
Instead, small companies are best at getting good at small things. Private label selling involves people who specialize in marketing, sales, or meeting customer needs.
It is that recognition that enables small companies to be stronger performers than large companies in many ways.