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Robert Drbul of Lehman Brothers, an investment bank, estimates that private-label brands are 10-15% more profitable.
ECONOMIST: Retailing
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If so, the future for private-label brands may well be outside their parent companies' doors.
ECONOMIST: Retailing
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Mr Cohen predicts that department stores will respond by creating stand-alone shops for their private-label brands and selling their wares in other stores.
ECONOMIST: Retailing
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The firm says it will continue to acquire luxury brands such as Kate Spade, which it bought last December, to focus on customers who find private-label brands unappealing.
ECONOMIST: Retailing
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Furthermore, private-label brands do not appeal to all buyers.
ECONOMIST: Retailing
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But Belling and cofounder Pat Turpin, an ex-investment banker who managed private-label brands for Costco, needed to get the snack out there fast before they could persuade chains like Safeway and Whole Foods to clear shelf space.
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This includes an extensive collection of company-owned private label brands, which offer value priced alternatives across numerous merchandise categories.
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The chain eliminated all private-label sunglasses and now focuses on only 20 brands--40% of them made by Luxottica (up from from 15% a year ago).
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The growing share of private label brands, international expansion and e-commerce strategy will further aid growth.
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According to the WSJ, stores have been increasing the prices on their private-label foods faster than the prices of the equivalent national brands.
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Private-label work carries other risks, such as losing margins on your brands when retailers see you're producing similar goods cheaper for someone else.
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The struggles of these companies and their brands are the fallout of the growth of private-label goods and the rise of hard discounters like Germany's Aldi and Lidl chains.
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