White Label

After being created, white label products are not given a specific name, but are sold by several corporations under various brand names and in various market groups. White Label manufacturers bear solely the costs of product manufacturing: this is a big advantage of this business strategy, as it eliminates the need for infrastructure investment. The White Label business focuses on process optimization and so has a better possibility of producing economies of scale. Due to the fact that the finished products are unbranded, suppliers can promote them anyway they like. White labels can also be used to brand a subset of a company's products. This is widespread in the food industry, where products are created in a same location, packaged differently, and sold under several brand names by merchants. Revenues from the sale of generic goods can supplement those from the sale of branded products. This enables the business to reach out to lower-income clients and diversify its distribution channels. Additionally, production will be more efficient if it is possible to reach clients with varying demands for product quality. Frequently, very little additional effort will be required to provide these additional clients, given all things are based on the same core product. To make the White Label business model work, clients must be unaware that purportedly distinct goods are actually identical; otherwise, sales of the more expensive brand are likely to be degraded or cannibalized by the cheaper substitute product.

When and how to apply White Label:

If your customers are extremely price sensitive and you already have a well-established brand, you may choose to pursue a White Label strategy. Historically, this business strategy has been extremely successful in both the food and apparel industries. To begin, you'll probably want to launch a small number of White Label products.
Well-known companies that use this pattern are Google and AWS.

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This Pattern is used by:


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