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Selling private label products is the most profitable ecommerce business model.
The most popular ecommerce brands (numbering 8 digits) are not generic waste. They use private label products as the backbone of the brand marketing machine.
With a little thought and resources, you can grow and sell your own brand, giving you total control and maximum profit.
The reason I created this guide is because too many people think there is an insurmountable learning curve to building a private label business.
Disclaimer: If you want to get rich quick, I’m sorry this is not for you. But if you want to put in the business, you can make real money by selling private products online.
This guide will help you understand what it takes to launch a private brand and give you ideas on products that are either privately or white worn.
You don’t have to be a big brand to succeed
The holy grail of ecommerce is when people start looking your brand. Make no mistake making cheap generic products available on Amazon or your website. Instead of building your own quality brand, you will forever be chasing your tail.
They search for “Jordan Shoes” 83,000 times a month. That’s more search traffic than the whole “Basketball Shoes” and “And1 Shoes” category, combined! But in reality – there is not much difference in materials or manufacturing process between Jordan and And1.
You don’t have to create the Jordan brand to be successful – see Peak Design. They have carved out a nice niche for themselves.
Every month, tens of thousands of people search for their branded products. And their products are NOT cheap.
I’m sure you can imagine how many markets are in that $ 260 backpack.
But guess what.
People buy it like crazy.
If your ecommerce site only sells other people’s stuff, you will only go so far. But if you are willing to invest the time and energy needed to build a brand, you can make some serious money.
But you’re probably wondering – How can I make a brand? It all starts with learning how to identify the right product / market and find the products they are looking for. You should find products for sale online that are relevant to the niche audience of the ecommerce site.
How to get started with a private label business (in ten steps)
Selling online is not as complicated as you might think. The proof of this is in the huge number of people who have had success.
There is always a risk when starting a business. But if you can master the basics, you can make a private sale for you.
Here are broad steps to sell branded products online:
- Niche Market Research.
- Identify the products you think they can sell.
- Go online for potential competitors.
- Assess your ability to cover previous production costs.
- Find a trusted private label manufacturer.
- Create your brand elements.
- Order your first batch of products.
- Start your own website and / or sell on Amazon.
- Invest time in marketing your products.
- Collaborate with your customers and find ways to improve the next product series.
These ten steps can take you from where you are to where you want to go. There is a learning curve You will need to pick up some new skills. But there is no doubt that you can learn the skills you need to succeed. It just takes a little research and perseverance.
See how to launch an Amazon FBA private label (from any country)
Snapshots of barriers to doing business with private labels
I don’t want to sound like selling online is easy. It’s not just difficult as some “gurus” like to do.
There are many important decisions you will need to make along the way. This guide will go a long way in highlighting the challenges your business will face.
Before you start selling products, you need to be aware of some obstacles. The strategies I will outline will help you overcome them.
You need the capital to start a private label business. You have to pay for the initial product series, branding, design, marketing, shipping and customer service. The more units you buy in advance, the better per unit price will be.
Resourceful entrepreneurs can purchase a private branded product for as little as $ 500. It all depends on your approach.
Remember to apply for income tax with the IRS. Keep a careful record of your financial accounts. Consider hiring a tax preparer.
Here are some additional tips for starting your own brand.
- You could end up pursuing the wrong market niches. This is a costly mistake.
- Your vendor may not be at work. Quality control is really important. If you do not get what you paid them, you will have an expensive problem.
- Wrong packaging can hurt the customer experience. Protection during shipping is as important as the brand.
- Setting up cost-effective product price points can be difficult. There are many variables that can hurt profitability.
- The market could shift to you. When you continue to drive, the train has left the station – and your products will remain on the platform.
White Label Vs. Private Label Vs. Wholesale
For starters, it’s important to understand the terms that ecommerce companies use to define their relationship with the company that provides their products and services. To make a profit, you will need to find the right suppliers and a true ecommerce business model.
- White mark is when you take someone else’s product and write your name. You directly sell a product developed, controlled, and serviced by someone else.
- Own mark is when you enter into a product manufacturing contract with your manufacturer according to your specifications. This results in the highest possible profit margin because you are only producing another product.
- wholesale is when you contract with a vendor to buy other branded goods. You simply resell the products you purchased in bulk. It is clear to everyone involved that you are simply a broker in the transaction.
There is a lot of confusion about the difference between white and private label products. When speaking with suppliers, always confirm that their definition matches your understanding. This will prevent a lot of confusion in your career as an ecommerce merchant. It is always best to invest time and energy in partners who clearly understand your needs.
How can I come up with private label product ideas?
This is where your creativity and your ability to research the market really shines. Almost anything can be privately flagged. Private label manufacturers offer you the best price when ordering bulk. So, it is important to choose the right products for development and production.
Warning: If you are not an engineer, it is best to stick to products that are simple and easy to design / develop. You don’t want to get stuck in solving unforeseen product problems. The more complex it is, the greater the chance of products being defective and returned.
There are various tools available to help you find opportunities in the market. Keyword research can help you identify the most popular trends on Google. If more and more people search for answers to a specific problem on Google, your product could meet the growing market.
Exploring the Amazon is another man who doesn’t think. Look for products that have a number of negative reviews. If you can develop a better solution at a similar price tag, you may be able to win over their customers.
Industry research is also important. If you dig below the surface, what trends do professionals see? What is the right market size? Are you growing or withdrawing?
Jungle Scout is a powerful database tool that lets you see what customers are looking for and buy on Amazon. If you have an idea, searching for this tool can help you confirm the size of the market. It will also help you identify the competition. Their dashboard can help you filter opportunities by market competitiveness, so you won’t waste time in a crowded market.
Expert Tip: You can filter products with lots of reviews and low overall ratings at Jungle Scout. This tells you that the product is in demand and has room for improvement. Lots of bad reviews are an opportunity for you.
What products are often sold under private label?
If you’re still trying to figure it out what to sell online, let me help you. I will single out the most popular niches where private label products are outstanding.
Private label products are more popular than ever. Some of the most popular products can be found in these segments:
Private labeled clothing and accessories
Clothing is a great market for private label brands. Customers love discovering new brands that help them stand out. The average wardrobe has more than 100 items of clothing and fashion. In addition, there are purpose-built clothing for exercising or enjoying a day at the beach.
Manufacturers stand by either a private or white label for any of the following:
- Yoga Pants For Women (63K Amazon Searches Per Month)
- Women’s Hiking Shoes (26K)
- Tactical Backpack (36K)
- Maternity Dresses (12K)
- Jean Shorts for Women (36K)
- Rain poncho (30K)
Private cosmetics and skin care is a big deal
The skin care industry is estimated to reach $ 180 billion by 2020.
Margins on cosmetics are crazy. People become more aware of what they insert into their bodies. Think vegan, natural, etc.
By pushing for healthier skincare products, the cosmetics industry is moving. This is a great opportunity for entrepreneurs to position their private brand as the perfect next step for customers looking to make a change.
Here are some examples of cosmetic products that you could privately tag:
- Cruelty Makeup (638 Amazon searches per month)
- Elf Makeup, a cruelty-free makeup brand (25 K)
- Organic Sun Cream (11 K)
- Natural Deodorant (28 K)
- Toothpaste with charcoal (35K)
- Coffee Scrub (5K)
- Tea Tree Oil (130 K)
- Anti-Aging Face Cream (11K)
It will be much easier to just label the white label – but if you want to – you could try to leave the manufacturer with parabens and sulfates.
Packaged foods are one of the easiest things to tag privately
Private food brand brands are moving online to find healthcare consumers at home. Think vegan, organic, gluten free, GMO free. In addition to healthy foods, customized sweets and other gifts are extremely popular with online shoppers. With the loosening of marijuana laws in North America, there has been an increase in demand for this type of food.
If you do not have coyons for selling weeds online (I’m sure not) – a safer bet is to launch a gluten free snack brand.
These are all super simple private labels, you just design the packaging.
- CBD tire (32K Amazon searches per month)
- Organic Baby Food (9K)
- Matcha Green Tea Powder (32 K)
- Gluten Free Snacks (20 K)
- keto snacks (89K)
Private Label Hair Care Ideas
Everyone has different hair needs. This is a huge market with an almost unlimited customer base. From bald men to natural curls – there are countless segments here.
Here are some private hair care ideas:
- Hair Growth Shampoo (12K Amazon Monthly Searches)
- Beard Oil (61 K)
- Hair Mask (26K)
- human hair bundles (21K)
- Vitamins for Hair Growth (11K)
Private label accessories are always in demand
People take supplements to combat all kinds of personal problems. JungleScout is, again, their friend. High retail prices have triggered large segments of the online marketplace. Dr. Axes is a perfect example of where to kill plugins with private labels.
Here are some of the strongest additions currently available:
- Vegan Protein Powder (58K Amazon Monthly Search)
- Detox Tea (27 K)
- Creatine (83K)
- Testosterone Booster For Men (20 K)
- Turmeric Turmeric (65)
These are just a few examples of the category. But something connects them. Each of the niches listed above can be marketed through influencer marketing and Facebook ads. And the relative cost of producing these items in large quantities is lower. In addition, profit margins can be phenomenal.
Have you ever thought about how much it costs to produce conventional cosmetics? Think of those tiny eyeliner bottles or a container of foundation. In-store margins are convenient!
And if you can find the right clothing makers, you can kill them there.
The markets where private brands thrive have small barriers to entry. The product life cycle is short. (Think about how often you buy these products.) And brand trust is important to the customer. This means that once you establish your brand, your customers will pay more.
How can I find a trusted private label manufacturer?
Your most important partner in the private label adventure is your private label maker. You may be able to make the products yourself, but it’s a difficult road. You will run into capacity issues and struggle with quality control as you chase the most efficient process for making customer-friendly products.
It’s hard to trust a new hard-earned money maker – especially if things are financially tight at first. This is why thorough vetting by private label manufacturers is so important.
It can all be scary. I promise, that’s pretty clear. I can show you the ropes. I offer in-depth training where I share my process of finding and securing the help of trusted private label manufacturers. Some of the areas I cover include:
- Product research and verification
- Overseas versus domestic producers
- Frequent scams and how to avoid them
- My manufacturer verification process
- Best communication strategies for engaging manufacturers
With the information from my courses, you will be able to find great manufacturers and get them to take you seriously.
Where should I sell private label products?
Depending on the type of market you want to sell, it may make sense to list private label products on a third-party platform. Amazon is the most popular e-commerce platform in the United States. But there are the advantages and disadvantages of selling private label products on Amazon.
In the photo above, I highlighted some Amazon products sold under Amazon’s private label. These are brands that Amazon has purchased or developed in their home. Amazon recognizes that they can make more money by selling their own products, instead of just taking a chunk of revenue from sellers on their platform.
A word of caution: Amazon has been aggressive in competing with sellers on its own platform. If you hit gold, Amazon probably isn’t too far behind. This is why it is so important to have more sales channels for your private products.
But don’t worry. There are a lot of niches. No company can cover all bases. The market is simply too diverse.
I usually recommend doing the heavy construction work and marketing your own ecommerce site. This way, you can maximize your long-term profits by selling private label products – avoiding commissions and listing fees on sites like Amazon.
You may be able to connect with your target audience faster by listing your product on a third-party platform. But, it will come at a price. You will have to decide if you want to
- Create your own ecommerce site and aggressively market your site to your target market.
- Place your products on Amazon’s established customer base.
- Or both. You could start selling on Amazon to generate some cash flow while you wait for your own ecommerce site to be established. Amazon affiliate is a great way to do it.
Check it out: How to launch an Amazon FBA private label (from any country)
Make sure you include shipping and storage in your product pricing strategy
Amazon FBA is a program where you can ship goods directly to Amazon’s warehouse. Once there, Amazon will display your item as stock on their site.
Better yet, your products are eligible for basic shipping, along with other Amazon benefits that matter to Amazon customers. Amazon will even provide customer service for your product orders. This can be a great advantage, especially if you do not want to reach customers over the phone.
If you worry about fees, it is very simple estimate Amazon FBA / MCF fees:
- Visit Amazon’s Profitability Calculator.
- Choose a product similar to yours
- Enter the estimated cost of the product
You have to decide if the benefits outweigh the costs.
Ready to sell private label products?
Once you have done your product / market research and established strong relationships with trusted suppliers, you will need to start a business and get a tax code.
Most suppliers only want to do serious business – not erasers.
Before you get to all the fun things like brand development, content marketing, Facebook ads, Instagram marketing – you’ll need to make a solid plan to ensure your financial progress.
It all starts with choosing the right niche product and validating your idea. If you want extra help, I would love to be of use to you – either through my 1: 1 coaching or online courses. I look forward to helping you succeed in your private label!
Questions? Leave a comment and I’ll answer you right now!
Thanks for visiting our site. As a way of saying "thanks" here's a FREE course on how to make $688 a day online using FREE methods: