How are Private Labels Benefitted by the Brand Aggregators?

It all started with a positive shift towards the sales of private labels and buying behavior of a consumer. According to Mckinsey, the sales of private labels have increased by 40%. Some North American label brands have also claimed an increase in the demand for their products. These brands have enjoyed a spike in sales, but they also have suffered equally.
The majority of the time, private labels face challenges in collaboration with any intermediary or retailer. Take retailers for instance. In many cases, retailers do not market labels’ products properly and prioritize the display of big international brands or in-house manufactured brands. As a result, the small and medium-sized private label firms suffer. Additionally, the challenge a private label faces is inventory clearance. Many times a private label ends up with low sales conversion mainly due to neck-to-neck competition. Zero or low sales stop the inflow and outflow of inventory, and hence the stock remains stagnant. Plus, the costs associated with it transform into liabilities. In this case, as a sole entity, a private label has to face all the losses.

In order to combat these issues, three out of five brands aim to invest in technology, product development, and comprehensive marketing tools but are strangled by their premium charges. Moreover, as an option to grow, these labels also prefer to scale up. This idea has turned stones for many, but the cost involved in research, development, implementation, and control demand a very deep pocket.

Between the risen and the fallen, we come across some obvious questions.
How are these brands that rose, saw their sales?
What different are they doing to get success?
Are these brands backed by financial giants that get enough dough to experiment and stay afloat?
In one word, the answer is yes! Some of the brands in profitable situations currently do different things than what other labels don’t. They noticed the need to scale up for the brand’s much-demanded growth. For this, the savviest private labels choose brand aggregators as the safest option to scale up.
Here are some of the factors that contribute to the acquisition leading to the development of a brand.

Technological Support

The brand aggregators work the best by enabling the private labels with multiple technological resources. They equip every function of a brand with tech tools to up their ante. Tools like cloud-based CRM streamline the sales process from managing potential prospects information to customer support service. It is a powerful tool that enables a brand to dive deep into its sales process and get a 360-degree approach.
Aggregators keep a track on every minutiae tech trend. They use successful tech systems like machine learning to bridge the communication gap between people and technology. One excellent example can be chatbots. Through machine learning, chatbots have transformed from following a given script to being interactive.
Talking about bridging the communication gaps, one cannot ignore the efficiency of smart project management tools. Over the years, project management technology has improved the collaboration between managers and their teams. The integrated technology centralizes the entire documentation, work schedules, and goals, keeping teams in sync with the organization’s goals. There is no complex technology involved, but rather a more straightforward approach. The transformation of the project management practice from a set of doc, spreadsheet, PPT and emails to a single all inclusive platform, keeps an entire better connected and updated with speed breakers, progresses, and deadlines.
Such tools help private labels get the much-needed detox from the dated technology.

Exclusive Branding Management

Brand aggregator refines the label’s system and infuses the firm with strategic and dedicated marketing efforts. The primary tools used are predictive marketing, PPC campaigns, mobile marketing, and content marketing. Here marketing is effectively backed by technology. Through AI-enabled applications, multiple marketplaces are managed. In predictive marketing, a single panel is created to manage the orders and determine customer behavior matrix. These functions allow an analyst to predict customer and market behavior. A real-time synchronization of applications with the marketplace makes the marketing flow easy and efficient.
Inside the label arena, individual products are also taken care of through a real-time dashboard that monitors user feedback. Then aggregators drill down to what’s working best for the  labels they acquired.

Distribution and Inventory Management

When taken over by an aggregator, the private labels are certainly relaxed because the inventory management issues get quick resolution. An aggregator manages the inventory in a much more effective way than any other. A large part of the aggregator’s responsibilities involves maintaining the stock, preventing over and understocking, obsolescence, and withstanding taxes. The use of order management and inventory control tools enable the tracking and monitoring of insights and visual analytics. Monitoring provides a way to keep track of orders, sales, prior records, and future goals, which increases the productivity of a firm.
A private label can control the distribution chains with its limited network and cost. But when merged with an aggregator, brands build networks all-around, and there are multiple ways to offer the product to a customer. Due to the network with distributors, suppliers, and 3rd party logistics, the distribution system works effortlessly. A brand aggregator not only lists the products on its website but makes sure that a private label shows up in almost all marketplaces. They even ensure the buy box is won through sufficient inventory criteria by Amazon or Walmart.

To Summarize

The potential of an aggregator is also something that attracts multiple investment opportunities. It helps a firm and brand to become financially stable. Essentially, it maximizes aggregator and label resources. We can now imagine how many labels in the industry might want to scale up. Therefore, the acquirees are many in the market, and every three out of five private labels aim to get acquired by a potential one. Thus, it is imperative to go with an expert with a widespread network, sharp minds, and deep pockets. At Ergode, we specialize in doing everything that you have read and more! We scale up private labels and put them on the road to success. So, do not think twice before contacting us!





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