Things to Know Before You Start Calling Private Label Manufacturers

Posted by Concept Labs on July 31st, 2019

Sometimes we get so captivated with our new projects we jump straight to the production. Start looking for label manufacturers, sampling products and pushing to get the product to market. In over excitement, we often skip some critical steps.

The products do not get the position in the market as you thought of.  Or the cost per unit is so high that you barely get the margin you should. These might make you decide to give up your project.

So before you embark on your dream project, and in order to make a successful start, there are a few things most crucial to know.

#1 Spend time on researching your market place

Get to know your market place where you will be selling your product. Whether you want to sell online such as on Amazon, or want to have your own salon, wholesale accounts, or on your own website and social media channels, be clear on where you would be selling your products.  This helps you understand your competition, pricing and master your marketplace.

#2 Understand competitors pricing

Once you know your marketplace is, now you need to evaluate if your product will be profitable.

Ask crucial questions like: ‘what are looking for’?  How much are the products you want to offer selling for?

This is important.  You understand if your COGS will allow you to be competitive.

For example, let us say your COGS (cost of goods) is .00 for body care product.

If you want to sell on Amazon, a quick search can reveal that your closest competitors are selling the same product for a cost somewhere between .99 and 13.99.

You see that there is no margin you will get for this product. And you had better look for private label body care manufacturers that can supply you a shampoo or other products you want to sell for COGs so you can compete in the market. Understanding your competitors’ retail pricing will help you choose the best private label body care manufacturer for your project.

#3 Choose the right packaging

Packing is not just meant to provide a kind of protection but it also gives you a way to influence your customer decision. The design of packets is crucial from marketing point of view. So if you have decided on particular packaging you need to make sure your private label manufacturer is able to fill this type of packaging. This is crucial because not all manufacturers have the equipment to label tubes or fill less than 1o oz. fills.

Also, sometimes, the equipment needs special tooling, and this may take an additional 4-6 weeks time. Also add to the cost to customize the machinery. So it is really crucial to check with your private label manufacturer before selecting packaging.