The Key Differences Between White Labeling, Private Labeling and Custom Manufacturing

The Key Differences Between White Labeling, Private Labeling and Custom Manufacturing

When it comes to sourcing your own products to sell online, you’ve undoubtedly come across the terms white label, private label and custom manufacturing. While each of these product types can have value for your business, understanding how they differ is crucial for selecting your manufacturing partners.

Different manufacturers have varying capabilities, especially in terms of their ability to help you make your products truly unique. By understanding the differences between white-label products, private-label products and custom manufactured items, you can select the appropriate partnership for your business’s needs.

What Are White-Label Products?

White-label products offer the least amount of customization. These are what consumers commonly refer to as “generic” products, in part because other than the different logos on the packaging, the products themselves aren’t going to vary much at all from retailer to retailer.

For these products, all manufacturing details — including the materials or ingredients used, the appearance, features and characteristics — are determined by the manufacturer. There are no variations to the product itself, even when being sold by different retailers.

While the product itself is generic, the retailer does maintain full control over the product’s branding and packaging. Some manufacturers may provide packaging services, while others will require this to be completed by the retailer. 

The same white-label products can be sold to a wide range of retailers. For example, if you wanted to sell a package of plain blue v-neck t-shirts on your website, you could enter a white-label agreement with a manufacturer.

However, the manufacturer could supply the exact same t-shirts to another retailer. The only difference will be that one t-shirt has your logo, while the other has the competitor’s. White labelling is commonly used for everyday products like flip flops and stainless steel water bottles.

Many online stores use white-label products for relatively inexpensive items that help expand their product lineup. By using a generic product, retailers can get new items to market relatively quickly and at an affordable cost.

What Is Private Labeling?

Private-label products have seen a dramatic rise in popularity in recent years, even influencing retailer choice, particularly among younger generations. A strong retailer brand can make customers quite loyal to these product lines.

While private-label products for Shopify and other online selling platforms certainly offer greater customization options than white-label products, they are still no where near being fully custom. However, they are still distinct enough that the finished product tends to be unique from those offered by the competition.

In manufacturing agreements for private-label products, the retailer will typically communicate specific alterations that it wishes to make to the manufacturer’s generic product. This could include characteristics such as some product dimensions, ingredients or even the number of items contained in a single package. Of course, the retailer’s branding will go on the finished product and its packaging.

While identical white-label products can be sold to several different retailers, this isn’t the case with private-label products. The customization work that is done on the product will be exclusive to the retailer that requested it. The manufacturer cannot sell that exact same product to other retailers. However, the manufacturer can enter other agreements to produce private-label products based on the original generic item.

Similar to white-label products, the manufacturer doesn’t have any of their own branding on the private-label products. For all intents and purposes, this is the retailer’s product. This is common with private-label grocery store brands, as well as products such as private label clothing, candles, pens and personal care products.

Going Big On a Custom Manufacturing Investment

Finally, some retailers want to go all-in on custom manufacturing. While private-label products already involve a level of customization, they are still generally based on a generic item. In custom manufacturing, it is more common for a retailer to work closely with a manufacturer to design and produce an item that is more fully unique.

Custom manufacturing tends to be less widely available than white-label or private-label manufacturing. Custom manufacturing plants in the US, China, India and around the world are able to offer full custom capabilities thanks to increased technology access and easier communications that will be required for such a project. 

While the manufacturer typically maintains control over their manufacturing processes, the retailer has much more input than they would with a white-label or private-label product. Items may go through several rounds of prototyping, including smaller test runs, prior to the design being finalized for full production.

These items are packaged, branded and trademarked by the retailer. The manufacturer cannot distribute the custom manufactured products to other retailers, or use the designs for the production of generic items.

While custom manufacturing can further establish a distinct identity for a retailer’s products, it is important to remember that this process naturally entails a much slower speed to market and a much higher investment to get the product into physical and/or digital stores.

The uniqueness of the finished product can make it easier to develop unique selling propositions for marketing purposes, but the retailer may need to sell more products or make them more expensive to recoup the initial investment. Some examples include custom wallets, jewelry manufacturers and cosmetic manufacturers.

Which Partners Are Right for Your Brand?

Whether you plan to produce private-label products for Amazon or white-label products for your own retail store, understanding the capabilities of your manufacturing partners is key to ensuring you get the results you want at a price you can afford.

Many retailers will even use a mix of white-label, private-label and custom manufacturing, depending on the type of products they are trying to add to their store’s lineup.

Of course, finding the right vendors to partner with can be a significant challenge. This is where Manufactured comes in. With over 500 trusted global partners, we can help you produce your goods in as little as six to eight weeks.

Whether you’re prioritizing USA manufacturing for your private-label products or need to quickly get a white-label product ready for your store, our network will help you partner with the right vendor for the job.

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