- Know how to lock in a good manufacturer.
- Find a list of solid questions to give your potential partners.
- Know the white label definition and how to use it to your advantage.
- Know how to pick out the best white label services in the industry
- Consider how your business operates and find a manufacturer that compliments that goal.
What is White Labeling?
White Label products are products or services produced by one company that other buyers rebrand to make their own.
It comes from the idea that when the finished product comes out of manufacturing, the label is white and ready for another company to purchase and brand. This way sellers don’t have to worry about warehousing, storage, manufacturing, inventory, or raw goods.
How Does White Labeling Work?
The manufacturer harvests raw goods, does quality assessment and testing, and then manufactures and stores the product. They don’t add any branding or styling and leave the product “unbranded”–which is becoming a buying trend in and of itself.
Since the manufacturer doesn’t own a brand, they typically charge less than finished products so they’re only making profits off of raw goods and labor. Often white label exchanges are done in bulk to lower cost.
Once a seller has bought the product and rebranded it, they sell it at a higher cost and make profit from providing the convenience and demand of the product.
In simple terms–manufacturers make products in bulk, someone buys that product, puts their label on it, and sells the products individually to make a profit. You’re selling the product exclusively as your own–and simply your labeling (you can change ingredients, flavors, or packaging if you’d like) makes it proprietary. People pay for brands.
Many companies you know and love are white label brands. Amazon alone has over 100 private label brands that operate in dozens of markets on its site. Despite making up less than 1% of its total third-party sellers, it accounts for 9% of sales (in their clothing department at least).
Benefits of White Labeling
Typically it’s a faster solution all around. Sellers get product quicker–which means end users receive their purchases faster–and ultimately makes everyone happy.
Sellers don’t have to worry about quality control or the overhead of manufacturing, and manufacturers don’t have to worry about the expenses of storefronts, web properties, or overhead of marketing and sales.
Plus sellers don’t have to worry about contracts, leases, royalties, or market share. Once the product is purchased, all revenue goes back to the seller–that’s it.
It saves the seller money and time, it allows the manufacturer to focus solely on the product, meaning that the end user gets a higher quality product at a budget friendly price.
How Do I Decide Which Company To Choose?
Consider The Following:
High Quality Products Come From High Quality Materials
The market belongs to the buyers (now more than ever)–and if they’re not happy with the quality–they quickly move on.
Check to make sure your manufacturer has certificates of analysis, proof of quality assurance, hemp sourcing, and raw goods testing. Hold your partners to the highest standard possible–it saves you money and headache with your end users in the long run.
Turn Around/Delivery Time
Once a manufacturer locks a seller into a contract, often they can underdeliver–they’re locked in. While a white labeler is often more reliable, you still need a company that can get you products quickly.
For example, 5 Day Private Label can get you finished products in only 5 days. That kind of turn around gives you the liberty to hold virtually no inventory, and get product to your end user faster!
Variety and Customization
Some private white label companies can only provide a limited range of options. So while it’s cheap and fast, it’s limited.
Make sure you have the freedom to customize and change concentrations. Scout out your competition and find where the gaps are and then find a company that can adapt.
For example, 5 Day Private label offers a variety of hemp concentrations, flavors, products, sizes, etc. Make sure your manufacturer can keep up with your customers’ demands!
Don’t go with a white label company that locks you into a large MOQ (minimum order quantity). You need the versatility to adapt to audience tests and responsive purchasing. Nothing is worse as a business owner than to be left with hundreds (if not thousands) of units that you can’t sell and just collect dust.
Most white label companies don’t have upfront prices–it depends on what you order, how much you order, and how often you order. If they have upfront prices, don’t work with them! You need the personalization of a consultant that can meet your individual needs.
Hemp is a booming industry, but it comes with a lot of red tape and rules. Is your manufacturer compliant? Are they FDA and USDA certified? Are they safe, fair, clean, and quality? Are they aware of all the rules and regulations surrounding hemp (both federally and at your local level)?
Ask every question you possibly can when choosing a partner and don’t feel guilty about grilling. This is your company and ultimately your money–you have the right to know how it’s being spent, and where your dollars are going!
Are They Successful?
Hemp is a competitive industry and you need someone that knows what they’re doing. They need to know the industry in and out so that they can give your creations the time and attention they need without losing time on miscommunications, misrepresentation, foibles, and fumbles.
Experience speaks in profits. Make sure they can back up theirs before you start investing yours!
Trickle Down Customer Service
You want a manufacturer that treats their products (and you) the way you treat your end users.
How do they respond to change? Are they adaptable or aggressive? Do they talk to you during the process, or have you been left in the dark unsure of what product will arrive when.
Customer Service is a big part of your business, so it needs to be a crucial part of theirs!
- Choose your partners carefully.
- Don’t be afraid to ask a lot of questions.
- Require the same standard of quality from your manufacturer that you do from yourself.
- Know your margins so you can demand fair prices from your manufacturer.
- ASK QUESTIONS!
- Be adaptable, have variety, and make sure your manufacturer does the same.
- Be hungry–stay successful!
Choose the right manufacturer. Call 5 Day Private Label Today!