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When we started our work on MDM’s latest Special Report, Private Label in the Wholesale Distribution Industry, my question was: What’s a distributor’s brand worth?
The answer: Quite a bit – if that distributor is playing a bigger role than just passing product through the channel. And for a private label strategy to work, a distributor must already be positioned strongly in its market, providing value on several levels to its customers beyond just the product it is selling.
For distributors big and small that have capitalized successfully on the shifts we’ve seen in the channel – customers with more information and power, demand for more services, fewer distributor exclusives, ongoing consolidation and more – private label is another tactic to tie themselves more closely to the end-user. About 40 percent of distributors in a recent MDM survey said they offer a private label.
In our now-finished MDM Special Report on private label in distribution markets, we presented the pros and cons of pursuing a private label strategy.
If you haven’t already, I invite you to read the articles, which cover what’s driving distributors to offer a private label, why private label can cause conflict in the channel with manufacturers, best practices in pursuing a private label and why doing private label well can be difficult.
The series of articles is now available in one report, or you can read them individually below:
- The Drivers of Private Label in Distribution
- Strategies for Private Label Success
- Private Label & Channel Conflict
- Distributor Groups Offer Private Brands to Members
- Master Distributors & Private Label
Subscribers to MDM Premium can download the PDF of this MDM Special Report here.