Why Wholesale Grocery Distributors Should Offer More Private Label Merchandise

August 05, 2016

According to Northwest Arkansas news site The City Wire, sales of private label goods have increased dramatically over the past few years. Private label products now account for more than half the sales when it comes to trash bags, paper plates and disposable cups. In addition, a high percentage of bottled water, toilet tissue and fresh bread sales are private label as well. Consumers are embracing private label products like never before, which is why wholesale grocery distributors should consider adding them to their inventory.

In 2013, private label sales made up nearly 15% of the total Consumer Gross Product spending. There has been slow but steady growth in private label sales since 2010; however, some economists predict they will explode over the next few years. The trend toward consumers moving away from highly recognized name brands and buying private label goods has even resulted in giants such as ConAgra purchasing competing manufacturers.

Private label sales increased to 17.6% for drug stores in 2013, but that figure was only 2.4% for convenience stores. As such, experts agree that convenience stores pose the next hurdle to cross in order to capitalize on this trend. Many feel that wholesale distributors have only begun to scratch the surface when it comes to offering new products that are in keeping with what customers currently demand.

Peter Tedeschi, President and CEO of Tedeschi Food Shops, a New England convenience store chain, commented on the importance of private label options at a conference back in 2012. At that time, he claimed that private label goods were becoming increasingly important in the areas of salty snacks and foodservice. He also remarked that “to the extent wholesalers can help with that gives us an advantage.”

As a distributor, one of the best ways you can increase sales is by offering more private label goods, as this is something consumers are demanding more and more of. To find out how you can use private label goods to enhance sales, contact us.