You don’t need to produce products to be an online retailer. In fact, many popular ecommerce strategies don’t require manufacturing at all.
Private labeling is one such business model. Retailers work with private-label manufacturers to create unique products for their brands. Those private-label products are then shipped to a fulfillment partner, to the retailer for stocking, or directly to consumers.
Private-label products are great for brands that have an established audience and want to expand their product catalog. Developing and selling private-label products is also a lucrative way for entrepreneurs to make passive income.
This post covers the basics of private labeling, including some of the best private-label products to sell. It also contains examples of private-label manufacturers and how to kickstart your private-label brand.
What is a private-label product?
Private labeling is when a manufacturer creates products to be sold by a specific retailer under the retailer’s brand name.
It allows retailers to outsource production while collaborating on design, materials, and other manufacturing decisions.
Brands may choose to sell private-label products to increase sales volume, cut costs, or offer items requiring specialist manufacturing techniques.
Private labeling differs from white-label products, where retailers sell generic, mass-produced items.
How does a private-label business work?
Successful private labeling businesses have strong brands, efficient online checkouts, and good relationships with manufacturers.
After researching a target market, retailers establish a brand and create sales channels to reach customers. Then, they’ll work with private-label suppliers to develop a product they can purchase, market, and sell for profit.
Most private-label retailers serve a specific niche, where they can build an understanding of consumer needs and match products to those needs. Clothing and cosmetics stores often develop private-label product lines, as do grocery stores.
The private-label business model continues to grow in popularity among national brands and small businesses—with store-brand private labels making up a large proportion of many retailers’ total sales.
Advantages of selling private label products
Beyond outsourcing manufacturing, private labeling has several advantages. They include:
Control over production
As a retailer, you can work with third-party manufacturers to select materials and ingredients, as well as make decisions about product quality, production rate, and costs.
Control over pricing
Once you know how much your private-label products will cost to produce, you have the freedom to develop your own pricing strategy and leverage your brand power to achieve a profit margin.
Small retailers selling private-label products can move quickly in response to market demands. You could work with your supplier to add a new product feature or tweak a recipe.
Meanwhile, larger companies with in-house manufacturing may be unable to pivot, giving you a window to secure market share.
Control over marketing and branding
You have complete control over how private-label products are presented to audiences and positioned in your catalog.
Disadvantages of selling private label products
While private labeling has many benefits, it doesn’t come without its challenges. They include:
Difficulty building loyalty from zero
If you’re a new brand, developing a following and customer base can take time. This is especially true for private-label retailers who don’t have a product development story.
Without a narrative about how you designed and crafted your products, you’ll need to find other ways to build a positive brand reputation.
This is one reason why private-label product lines are often launched by trusted names with established audiences.
Because a third-party manufacturer handles production, you’re largely at their mercy. Supply chain issues, price increases, and problems with product quality are all potential issues that impact private-label retailers—with retailers having little recourse to find solutions.
That’s why choosing a reputable, reliable supplier is so important. Quality can differ significantly depending on which private-label manufacturer you work with.
40+ private-label product ideas and manufacturers
Working with a private-label manufacturer gives you access to millions of items to sell. You may also be able to develop a unique version of a product that’s exclusive to your brand.
But with so many potential items, sourcing products from a reliable supplier can be tricky.
Here are some of the most popular private-label product categories. Each category contains private-label product ideas based on monthly search volume (MSV), as well as examples of relevant private-label and white-label manufacturers:
- Private-label apparel and accessories
- Private-label cosmetics and hair care products
- Private-label foods and supplements
Sell private-label apparel and accessories
With easily customizable designs and the potential for multiple color and material options, apparel products lend themselves to private labeling. Here are some of the most searched for apparel and accessories terms:
- Backpack (1,220,000 MSV)
- Women’s jeans (368,000 MSV)
- Maternity dress (368,000 MSV)
- Men’s dress shoes (201,000 MSV)
- Women’s hiking boots (165,000 MSV)
- Women’s tank top (135,000 MSV)
- Women’s yoga pants (49,500 MSV)
- Workout shorts for men (9,900 MSV)
Private-label apparel and accessory manufacturers
If you run a Shopify store and are interested in selling private-label apparel products, consider these suppliers:
Available for retailers shipping to the EU, UK, and US, AOP+ is a platform for selling custom products on Shopify and Etsy.
This supplier specializes in organic print-on-demand (POD) products, where retailers add custom designs to clothing, home products, and accessories.
Because AOP+ handles manufacturing itself (unlike some other POD companies), you can work with it to create private-label apparel, furnishings, and accessories, including t-shirts, flip-flops, totes, and wall plaques.
When you’ve designed your products, AOP+ syncs with your Shopify store to automate order processing and fulfillment.
Los Angeles–based Apliiq is another private-label supplier and print-on-demand company specializing in apparel items. It focuses on trending products like woven labels, pocket tees, liner hoodies, and patch beanies.
Apliiq automates order processing and fulfillment, committing to shipping every order within a week. The Apliiq Shopify app also sends tracking information directly to your customers so they can see when orders will arrive.
Modalyst is a dropshipping supplier that works with US-based providers.
For private-labeling, Modalyst specializes in athleticwear. Subscribing to the platforms Pro Plan gets you unlimited products, custom packaging and branding, and fast shipping—typically three to eight days for US orders and under 15 business days for international shipping.
Like other manufacturer apps for private labels, Modalyst automates order processing and fulfillment and offers live chat support for retailers.
Create private-label brands in cosmetics and hair care
Some of the most successful ecommerce stores in recent years use private-label business models to sell cosmetics products. Here are the most searched-for keywords in the cosmetics and hair care niche:
- Shampoo (673,000 MSV)
- Hyaluronic acid (550,000 MSV)
- Sunscreen (550,000 MSV)
- Moisturizer (450,000 MSV)
- Hairspray (368,000 MSV)
- Conditioner (246,000 MSV)
- Dry shampoo (165,000 MSV)
- Hair oils and serums (110,000 MSV)
- Eye cream (110,000 MSV)
- Hair wax (74,000 MSV)
- Mousse (74,000 MSV)
- Hair gel (60,500 MSV)
- Exfoliating toner (18,100 MSV)
- Natural facial cleanser (6,600 MSV)
- Curl enhancing cream (1,000 MSV)
- CBD face oil (920 MSV)
- Polypeptide cream (590 MSV)
Private-label cosmetics and hair care manufacturers
Try this manufacturer for developing your own private-label cosmetics product line:
Thomasnet is a supplier directory for North America with more than 500,000 suppliers and six million products.
To use Thomasnet to find reliable private label manufacturers, type “private label manufacturing” or “contract manufacturing” into the search bar.
You’ll land on a results page with many product options, including beauty items, skin care products, dietary supplements, and CBD products.
You’ll find information about each manufacturer, including its capabilities, certifications, and contact info—as well as an option to request a quote.
Sell private-label products in food and supplement niches
Join national grocery stores who invest heavily in private-label brands by targeting these popular food and supplement categories:
- Cakes and pies (2,700,000 MSV)
- Pasta (1,500,000 MSV)
- Candy and chocolate (1,200,000 MSV)
- Probiotics (673,000 MSV)
- Soup (550,000 MSV)
- Niacinamide (550,000 MSV)
- B vitamins (368,000 MSV)
- Condiments (165,000 MSV)
- Gluten-free (135,000 MSV)
- Breakfast foods (110,000 MSV)
- Omega-3 fatty acids (90,500 MSV)
- Organic foods (60,500 MSV)
- Tri-Mag (22,200 MSV)
- Fair trade (12,100 MSV)
- Vitamin D3 liquid (3,600 MSV)
- Zinc with elderberry (1,600 MSV)
- CBD (1,600 MSV)
- Non-dairy products (1,000 MSV)
- ADK (480 MSV)
- Liposomal melatonin spray (390 MSV)
Private-label food and supplement manufacturers
Using Dripshipper, you can create and customize your own branded coffee packaging, logo, pricing, and labels.
Dripshipper is based in the US but ships worldwide. All shipments are sent within five days of an order—whole beans ship the same day they’re roasted, while ground beans are dispatched the next day.
Depending on your monthly plan, Dripshipper also offers added support, coaching, and training. The Elite plan provides access to Dripshipper’s in-house design team.
How to start a private-label brand
Selling private-label products takes much of the effort out of product development. It lets retailers focus on the tasks they often excel at: branding, marketing, and selling to customers.
Here are the basic steps for retailers who want to open an ecommerce store using the private-label model:
- Find a niche market in which to sell products
- Contact a reliable private label manufacturer
- Order samples
- Set up an online store
- Add private-label products to your store
- Launch and market your store
1. Find a niche market in which to sell products
You can sell many private- and white-label products, spanning most consumer niches on the internet. Some of the most popular private-label products include:
To figure out the best private-label products for your own brand, explore smaller, specialized markets within broader categories. When you sell to a niche market, you can use highly targeted advertising strategies to find motivated shoppers.
2. Contact a reliable private label manufacturer
Once you know what to sell, look for manufacturers and suppliers who produce those items. Some manufacturers, like Dripshippers, may specialize in a specific product category.
Get your shortlist of manufacturers and contact them to see if they offer private labeling. You may find that a manufacturer already produces products for your competitor brands.
When talking to manufacturers, ask about the level of customization and design collaboration they can accommodate. Also, inquire about minimum order values, as you’ll need this figure to calculate your inventory management requirements and profit margins.
3. Order samples
If possible, always test products thoroughly before making them available to your customers.
While an item may look great online or in a manufacturer’s showroom, the reality may be completely different. Just as it may take a few orders to find the perfect fit for clothing, the same goes for working with private-label manufacturers.
You’ll want to do your due diligence to ensure the quality of products is up to your standards and expectations.
4. Set up an online store
Once you’ve set up your website and sales channels, browse the Shopify App Store to find the apps you need to manage your private-label business. Many supplier apps will sync with your orders and inventory to automate shipping and fulfillment.
5. Add private-label products to your store
When adding products to your store, you’ll want to try these content marketing best practices:
- Write compelling product descriptions. Product descriptions should be about the benefits customers will experience when they buy an item, not just the features and details of the product (although those are important, too).
- Get high-quality product images. Product photos are often the only way online shoppers can see what an item looks like. Try to step into your customers’ shoes and consider what images you’d need to make a purchasing decision if you’d never seen your product in the flesh. Sometimes, manufacturers can provide pictures for you.
- Determine your pricing strategy. It’s crucial to price your private-label products high enough to make a profit, but not so high that you outprice your target market.
6. Launch and market your store
When you’re ready to reveal your store and private-label products to the public, it’s time to start marketing. You have to build awareness and drive traffic to your site to make your first sale.
For new stores, paid advertising on channels like Google, Facebook, and Instagram are a good way to promote your brand (and canvas competitors for future marketing and product ideas).
Launch your private-label brand
Starting a private-label brand takes the hassle out of product development—a big challenge for many entrepreneurs. You can create an online store, build a following, and then work with manufacturing experts to design unique private-label products your customers will love.
Private label products FAQ
How much does private labeling cost?
At a minimum, starting a private labeling business costs around $1,000. Your most significant expenses will be associated with ordering samples and setting up the logistics of your business, including your website, payment processing, and order fulfillment.
How do I price private-label products?
To price private-labeling products, consider manufacturer costs, shipping fees, and the expenses associated with selling your products (including website fees, marketing, and payment processing fees). Once you have a number, compare it to your competitors to see how you stack up. You can run tests to determine how much your customers are willing to pay while you still net a profit.
Can you make money from private labeling?
Yes, you can make money online by private labeling. Follow the steps in this article to find out how to make money by selling private-label products.
How do I start with private labeling?
- Choose the niche you want to sell products in.
- Contact a reputable private-label manufacturer that meets your quality, volume, and customer service standards.
- Collaborate on your product designs and order samples to ensure the products meet quality standards.
- Organize shipping and fulfillment with your manufacturer or a third-party solution.
- Create a website using a tool such as Shopify to market and sell your products online.