The development of private labels is experiencing a movement of legitimacy and recognition in the Brazilian retail market by consumers. According to Nielsen data from 2022, products in this category are already present in 40% of households in the country. This approval represents a significant expansion of the sector in recent years, revealing new business opportunities, the possibility of increased revenue, and customer loyalty through the creation of an exclusive product line.
The food sector is responsible for concentrating most of the private label brands in sales in Brazil, which has a robust manufacturing infrastructure for food production. However, the exploration of the concept ofprivate labelcan be extended to other segments, such as pharmacy and personal hygiene.
Recently, private label items created bypharmacy chainsthey outpaced the growth of supply of this type of product in the food sector.Pet shop, beauty and construction materials make up the other strategic areas that have shown solid and sustainable growth in the marketprivate labelBrazilian.
The evolution of this business model will be one of the main themes of PL Connection, the largest event inprivate labelof Latin America, which will take place between September 17th and 19th, 2024, at Expo Center Norte, in São Paulo.
Private label in expansion
Private labels are gaining more relevance in Brazil and attracting the retail sector, which sees an opportunity to increase product offerings and revenue. This is because the segment still accounts for only 2% of the retail sector in the country, leaving room for numerous expansion possibilities.
In Latin America, the presence of private label brands in businesses is around 10%, while globally this rate is 23%. In some countries of theEurope, the commercialization of private label productsIt accounts for more than 50% of the shelf space, which supports the growth expectations in Brazil. These items are capable of creating a communication link that brings the brand closer to the consumer, and where the business's reputation serves to legitimize the origin of the product.
However, the supply of items classified as private label lacks some precautions, such as thoroughly knowing the suppliers through their market track record. Monitoring the quality level with technical and laboratory tests represents another step in the product designprivate labelbefore its commercialization.
