Is ‘dual tracking’ (producing both private labels and A-brands) a good idea?

The strong growth of private label is tempting A-brand manufacturers to also produce private brands. On the other hand, private label manufacturers see opportunities in developing a national brand. What opportunities and risks does “dual tracking” bring?

Growth market

Private label has been on the rise for some time, but last year total private label sales grew by as much as 25 billion euros to 302 billion euros, according to figures from the association of private label manufacturers PLMA. That is a record: family budgets remain under pressure and high inflation is causing an increasing price gap between private labels and A-brands. No wonder brand manufacturers are looking at this growing market with great interest. Could it be interesting for them to develop private brands alongside their national brands? It is a question many manufacturers are grappling with.