How Are Store Brands Different From Name Brands?

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MINNEAPOLIS (WCCO) — As prices for everything rise, more shoppers are turning to store brands. They’re called “private labels,” and they’ve grown year over year.

So how are store brands different from name brands? And how much do you really save? WCCO’s Heather Brown visited a test kitchen in Hopkins to find out.

You might know them as tater tots, but let’s call them their real name: “Essential Everyday Potato Rounds.” They’re in the freezer aisle at Cub Foods.

UNFI Brands has 18 different brands. They don’t actually make the stuff, but develop it for stores to use as their brands. Bekah Swan is president of UNFI.

“Our mission for store brand product is high-quality product at a value for the customer,” Swan said.

How much can shoppers save by buying private label products? It depends on the category, according to Swan. Here are three examples:

* Paper towels: Between 25% – 40% less expensive
* Pasta: 15% – 20%
* Laundry detergent: 15% – 20%

So how are stores able to see these products at a lower price?

“Marketing,” Swan said. “We don’t have national TV budgets.”

(credit: CBS)

Many brands don’t have fancy packaging.

“We also have a very small team,” Swan said.

There was once the perception that store brands just weren’t as good. So what has changed? Brand expert Todd Maute says that years ago, store brands were just cheaper, and not so great.

“And then retailers really realized that if they invest in private brands, you know, research shows that consumers will become more loyal to a store,” Maute said.

He points to the success of Trader Joe’s, where 95% of what they sell is private label.

“Over time, private brands have kind of evolved into going into specialty spaces,” Maute said. “Imported foods, premium products, even natural and organic.”

Source: CBS Minnesota