In today’s world of ecommerce, traditional retailers need to find a way to thrive. Customers are continuing to shop online more and for a retailer, finding ways to innovate or increase margins can be a life saver.
That’s why there has been an increased trend towards private labeling in the retail industry. Private labeling for retailers enables them to cut out brands and create their own lines of product. Instead of buying products at wholesale prices, they can buy at factory direct prices (through platforms like Sourcify).
Retails who traditionally buy wholesale, see an increased margin of almost 36% going direct to a factory. Everyone in the industry knows that brands need their own margin to survive. What most retailers don’t know is that going factory direct isn’t as hard as it once was.
For Island Surf, a retailer that sells surf products based in Florida, creating their own brand was a godsend. From their data, they knew which products would sell, like the Rainbow flip-flops, Billabong boardshorts, and Nixon watches they carried.
With this in mind, then went out to create their own brands to increase their margins. The problem for them, manufacturing. Going factory direct has always been a challenge for retailers as dealing with overseas production can be a challenge.