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As the trend of private label among distributors continues to grow, it's important to recognize the legal risks associated with this strategy. According to the National Association of Wholesaler-Distributors, if products are sourced from overseas, as many are, distributors may end up carrying the ultimate blame or responsibility in a number of situations, including product liability claims, intellectual property infringement, and product recalls. Read more about these risks.
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Have no plans to get into private label? This article looks at why private label is not going away, and why distributors and manufacturers should devise strategies to respond. After all, if a customer can substitute a private label for a manufacturer brand, he probably will unless there is a compelling value proposition offered by the manufacturer brand and the distributor that sells it.
Ways you can effectively fight or promote a private label: change your mindset; partner effectively with others in the channel; innovate; fight selectively; price competitively where you can; improve quality; and market creatively.
Read this related article to learn more: Private Label – A Balancing Act
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