Private Label Selling – What It Is And How It Works

Private label selling is a great way to start and run your own business. If you have ever wanted to be an entrepreneur, but felt limited by ideas, finances, or the responsibilities of your day job, this may be opportunity you have been looking for.

Private label products are those that are manufactured by one company and labeled to sell by another. Anytime you pick up a “store brand” product at the grocery store, you are buying a private label product. How does that translate to starting your own business?

Grocery stores and big box stores aren’t the only ones that can sell their own branded merchandise. You, or anyone, can purchase items, create your own label to sell them under, and start selling.

So, what’s the catch?

There is none. Select the right item, and you can be making money in days.

GET THE COMPLETE BLUEPRINT TO PRIVATE LABEL SELLING HERE

Creating a Brand

Before we get into what you can and cannot sell with private label selling, how to get that first sell, and how to run your business, you need to understand what your actual job will be.

You won’t be manufacturing your own product. You probably won’t have any input at all in the design or development of your product (there are exceptions, we will talk about below). Your job is to get the product from the manufacturer to the end user.

How do you do this?

You create your private label brand. No one expects you to compete with the big names, such as Nike or General Mills. You may not even do anything to personalize your product or packaging. Regardless, your brand will be your livelihood.

People need to be able to find your product, and they need to trust your product. What does that mean for you?

Pick a Quality Product

There is a pretty good chance that your product will come from overseas. That’s fine. Many of the most dependable products we use on a daily basis come from overseas.

Do Your Homework

Check the quality. Read reviews before you purchase.

Order Samples

Be sure to always order samples from your supplier before you ever place on order.

Place Your Order

Once you do place an order, when your order comes in, look at the stock. Is it what you expected? If you have concerns about the quality, don’t brush them aside. You may get a few sales, but you’ll be giving up your online reputation if the item isn’t as described.

Once you have a quality product, you’ll need to build your online reputation. A few reviews will do wonders to help your product stand out. A platform like Amazon does not allow for paid reviews. You can, however, encourage purchasers to leave reviews. You will be surprised at how many people are happy to help out.

What Happens if Someone Isn’t Happy?

Returns are something nobody wants to think about, but they are part of the retail experience. Minimize the number of returns by describing the product thoroughly.

As far as accepting returns, generally you will need to. In today’s huge internet marketplace, not accepting returns is a red flag many consumers will avoid.

What Can You Sell With Private Label Selling?

The better question would be what can’t you sell when private label selling? If you can think about it, chances are there is a company making it available for you to sell.

Cosmetics, Shampoo and Skincare

Have you considered getting involved in a mlm because the products interest you, but you don’t care for the business structure? Selling your own line of private label cosmetics, shampoo or private label skincare can allow you to invest in your own business, selling products that interest you.

Coffee, Wine and Other Beverages

Are you a connoisseur of wine, coffee or tea? There is a market for that in the world of private label selling.

Clothing

Whether it is workout wear or the latest fashion, it is available to sell under your own brand.

Supplements

There are always people interested in living a healthier life. If you find yourself keeping up with the latest health news, selling private label supplements under your own brand may be something that interests you.

One of the things that makes this type of selling such a good choice for business is the wide range of available products.

You want to select an item that is popular enough that there is a demand, yet not so over saturated that your product cannot gain traction, the field is really wide open for you to choose something related to your own interests.

What Type of Investment is Required?

Starting a private label selling business is not without some costs,. They are generally low when you take into consideration the cost of starting many new businesses.

You will need to purchase some initial inventory and have it labeled. You can keep these costs low by negotiating with suppliers for smaller minimum orders, which many are happy to do.

What Steps Are Involved in Private Label Selling?

The first step in starting your private label business is to select your product. You may want to choose only one thing, or you may decide to pick a few related items. One way to maximize your sales is to search the item you are considering selling on Amazon. Scroll down and look at the “often purchased together” item listed alongside. Offering both options is a great way to make a bonus sale with no effort.

Finding a supplier is the next step in the process. A google search for your item + private label will give you many options. For many products, the lowest price option often ships from China. These products are generally good quality, and the companies reputable.

If you are interested in private labeling cosmetics, food, supplements, or other products that have specific regulations in the United States, ordering from a US-based company is often the better choice.

Once you have selected an item comes the fun part. It is time to personalize your product. There are a variety of ways to do this, you can have your own labels designed, personalize the packaging, or just sell it as-is. Some products, such as kitchen gadgets or electronic accessories, do not lend themselves to branding.

Your First Sale

Once your stock is ready to go, it’s time to sell your product. There are a variety of ways to drive sales. What works best for you is determined by your product, personal experience, and fulfillment method.

If you have an existing blog or strong social media presence, you can use that to leverage sales. It is not, however, necessary.

Fulfillment by Amazon is a popular choice for many people interested in this type of business. There’s a good reason for that. It is hard to argue that Amazon knows how to sell online. Using Fulfillment by Amazon allows you to use Amazon’s audience to sell your product.

As a bonus, items that ship through the Amazon fulfillment platform allow the buyer to take advantage of Prime Shipping. Being able to utilize Prime Shipping is a deciding factor for many Amazon purchases.

Is Amazon My Only Choice With Private Label Selling?

While many people strictly use Fulfillment by Amazon to market their products, it is not the only way to sell these goods.

You can use an ecommerce site, such as Shopify.

You can build an online store to attach to an existing blog, using a program such as WordPress and Woocommerce.

You can use a social media plugin that allows you to sell through Instagram or Twitter.

Can Anyone Get Into Private Label Selling?

One of the most exciting things about private label selling is that anyone can do it. Do the research, find the product you want to sell, market it, and you’re in business.

Just because anyone can do it doesn’t make it easy however. The internet is a huge world, and it takes effort to stand out. If you don’t do your homework, you will find yourself with products that don’t sale.

What Makes a Product Sell?

There are a variety of things you can do to help you select a great product. The first step is to come up with some ideas for things to sell that interest you. Look around your house, common everyday staples are often a great choice.

Enjoy cooking? Think of some kitchen gadgets?

Do you workout? How about exercise gear?

Like to decorate? Consider decor items.

Always reading skincare labels? You may want to check out private labeling beauty products.

Popular keywords

Selecting a product that people search for is the easiest way to make a sale. In a world where you are counting on customers to come to you, it is important to select a product that people are looking for.

Competition, but not too much

If there is no one selling what you are selling, you may be tempted to jump in with both feet. Before you do this, take a few minutes to consider why that is. If there is no competition in your proposed niche, there is probably a reason.

Perhaps a quality private label product is not available.

Maybe it is something that is not economical to ship.

If there is no competition, find out the reason why before you move forward.

On the other hand, too much competition is not a good idea either.

Once you are established, you may want to compete with the big boys. Just starting out, however, you want to select a product that you can realistically hope to stand out with while selling.

Affordable, but with sufficient room for profit

It may be tempting to choose an expensive product to sell. It makes sense, you can sell fewer items and still make a profit. It doesn’t really work that way however. Particularly in the beginning, when you don’t have any reviews, people are going to be less inclines to buy a pricey product from an unknown seller.

Don’t worry about how many items you have to sell before you’re making real money. Instead, focus on a product that allows you to make a profit, while being inexpensive enough that people will not hesitate to buy from an unknown company. Once you get up and running, you will be surprised at how many sells you can make in a day.

Can You Create Your Own Product?

One of the most appealing things about this type of business is your ability to stay hands off in the design and manufacturing process. Some people, however, want a little more control or creativity in their products. There are private label products that allow more autonomy for individuals who find that appealing.

Cosmetics, skincare, and supplements are markets to explore if you have the desire to personalize your products. There are a variety of private label companies that will work with you to customize your own formulas.

Don’t let the process scare you. These companies have professional on hand to help you personalize your formula. You will work with them to come up with a product that is uniquely yours, while also safe.

Customized skincare or supplement formulas are great business opportunity for individuals who are already invested in that arena, either as a business or a hobby. For example, someone who blogs about skincare, makeup or fitness, would have a built-in customer base for their product.

If that is a little more customization than you want, there are still products that you can add your own branding to. Apparel, tote bags, mugs, and tumblers are all items that you can easily add a logo or saying to before putting it on the market.

The customization process does add a a step to the sales process. For individuals just starting out, or those on a tight budget, it may make sense to hold off on stocking this type of inventory until your business is more established.

What Are the Drawbacks With Private Label Selling?

If private label selling is such an easy way to make money, why isn’t everyone doing it? Well, it definitely isn’t easy. What it is, is doable. As long as you follow the steps and work on your business daily, you will meet with success.

Some people select a hot product at the right time and start making money the first day. Other people have a slower start, but day in and day out make consistent sales.

If you are the type that is easily discouraged, or that is hoping to quit their job by the end of the week, this probably isn’t the business for you. If you’re someone who understands the importance of consistency, and is thinking of the long-term, you can probably find success.

How Much Money to Start?

Starting your own private label business is not something you can do with no capital. You can, however, start it on a shoestring. You will need your products, and labeling. You can start small, there is no reason to order a huge amount of products to get started.

When looking for suppliers, don’t be surprised to hear that they expect a fairly large minimum order. If a particular seller has something your interested in, contact them in person. They are often more than willing to negotiate both price and minimum order size. You never know unless you ask.

Where Are My Customers?

If you have made it this far, this is probably the question that is still on your mind. The internet is huge. Even if you decide to go specifically with Fulfillment By Amazon and sell private label products on Amazon, and select a niche that isn’t over saturated, you are still facing stiff competition. How to stand out?

Create An Amazing Product Listing

This is where you truly make the business your own. Take the time to write a description that makes your product stand out among its competitors. Make sure the title descriptions leads with the most important information, as it may be truncated in search results.

When describing your product, try to think of any questions a potential buyer may have. Take a few minutes to brainstorm and jot down potential questions no matter how random.

Now answer those questions with direct statement. “Waterproof” “Dishwasher-Safe” “Machine Washable” “Spill-proof.” Always include any relevant measurements.

Don’t make the consumer go looking for the answer or put the responsibility on him to ask or post a question. If you do this, he is more likely to just scroll to the next listing.

When writing your description, remember it is actually an advertisement. Yes, it needs to include information about the product, but it also needs to sell the product.

Take your time when writing the description. This is just as important, if not more so, than selecting the product. Use keywords that the consumer is likely to use when searching for the item.

Read and re-read the description. It is helpful to set your writing aside for a few hours or overnight, then come back and read it with fresh eyes.

  • Does it describe the product?
  • Does it answer any questions the customer may have?
  • Does it explain how the item will solve a problem for the consumer?
  • Does the description lead with the most important information?

Make sure every word counts.

Conclusion

Private label selling can be a great business to get into. You can start with little capital, and your success is related to the effort you put into it.

Once your business is established, you will find it takes little effort to make sales.

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