The Advantages and Challenges of Private Labels In Convenience Stores

Cranberry Juice labels
Costco's Kirkland Private Label Cranberry Juice labels

Convenience stores nationwide around America have been seeing huge success with private label products. Private label brands made $4.2 billion in convenience store sales in 2019, according to IRI data.

Read: Private Label Brands Are Driving More Store Foot Traffic.

In 2019, Target started a private labels brand called ‘Good & Gather’.

The rise in sales of private label products is obvious, consumers have become “much more willing to splurge on store brands than they would for name brands” according to Nielsen.

While the nation’s name brand products grew at $153.7 billion for the year, the gap for private label is beginning to close. Custom product labels are becoming more popular every day, as sitgma against big name popular brands has changed.

But what is the reason private label products are begging to become so popular?

“One of the main driers is loyalty, and the perception of value and often times true value” says Brad Cohen, an Orlando Florida based marketer with LMS Marketing.

Which products benefit from private label the most?

  “The products that benefit are the ones that are easily comparable. So, for instance, in snack foods, mixed nuts—you can look at a bag of pecans and see the size of it. You can see the percent of breakage, the quality of it vs. another brand of nuts.

You can look at a private label in CVS, look at their extra-strength [acetaminophen], compare it to Tylenol and look at the label, and you can see the ingredients are the exact same.” Cohen says.


Which products don’t benefit from private labels?

“In general, health and beauty. Shampoo and your hair is very important to you. With those types of things, it’s hard to break away. For some of these things, if you buy it you’re making a commitment before you even know if you’re going to really, truly want to substitute your loyalty for whatever perceived value or reason you would buy it.” Cohen Said.


How long do you think private labels growth will be?

“It’s going to be several years.” Cohen said.


Which are the most important things for a private label brand to be successful?

“Volume is important. So if you own a corner store and want a private label, you can [have one], but it’s going to cost you some money. If you have 50 stores and you want a private label, it’s going to be more beneficial, and it just scales up. So being able to go to a private-label manufacturer and buy five truckloads of product vs. one truckload of product, you’re going to be able to get a better deal.” Cohen says.