Running your own cosmetics line is exciting, but it also comes with various new responsibilities and tasks you’ll need to conquer. For example, you’ll need to find your target market and depth understanding of customer needs —and that’s just the beginning!
One of the most important things you’ll do when launching a new cosmetics product line is decide how you’ll source your products. Are you manufacturing your products yourself? If you’d prefer to work with a manufacturer, you need to determine if you’ll use white labeling or a private label. This post will explore the difference between white label and private label, plus the advantages of buying white label cosmetics.
White Labeling vs. Private Labeling
New entrepreneurs may use the terms “white labeling” and “private labeling” interchangeably, assuming they refer to the same thing. This is a common misconception; the two are different, and understanding these two label types will help you develop your business model.
What Is White Labeling?
In white labeling, a manufacturer will create a product with no logo . A business will then purchase this product from a third party and brand it as their own. After buying the product, all you must do is add your logo to the front. Often, this is ideal for someone new to the industry who doesn’t yet understand the many complex steps to product development.
What is Private Labeling?
We now know white labeling refers to when a manufacturer creates a product for another company to sell under that company’s name. But what is private labeling? During private labeling, you’ll work with a manufacturer to make a product and discuss your ideas for unique formula and design.
For some entrepreneurs, this is likely the next step up. You might turn to private labeling when you better understand your products, ingredients, and target market. You can work with a manufacturer to customize things as you shift from white label to private label.
The Benefits of White Labeling
Let’s get into the top advantages of white label cosmetics! Various self-employed business owners use this tactic. In the cosmetics industry specifically, many salon and spa owners use white labeling for their products, as do beauticians and makeup artists.
Low MOQ
White label products usually have a lower minimum order quantity. This is because the supplier has already developed and produced these products, and typically also has sufficient production capacity and inventory to provide smaller order quantities to customers. In contrast, custom products typically require higher minimum order quantities as a whole batch of products needs to be produced and customized, increasing costs and risks. Therefore, for customers who need a small quantity of products, white label products are a more economical and practical choice
It’s Budget Friendly
One of the top reasons people gravitate towards white label cosmetics is because they’re more affordable: all you have to do is purchase your product and label it. In addition, the manufacturer already made the product, so you don’t have to worry about testing, certifications, and the other fees that come with making a product.
Shortened time to market
Skip the hassle and use a company you can trust to manufacture your products. You won’t have to wait on experts to create the formula, Since white label products are already developed, customers can bring their products to market faster without having to develop their own products. When you buy white label cosmetics, you only have to worry about adding your branding to the packaging, which helps you restock in no time.
There’s Less Risk
When it comes to cosmetic products, there are specific guidelines you need to follow to ensure what you sell is safe to use on skin. When you work with a manufacturer to formulate your products, you’ll have to keep those guidelines in mind and then go through the necessary procedures before putting them on the market.
Is White Labeling Better Than Private Labeling?
Whether white labeling or private labeling is better depends on your customers and market since the preference depends on your business. Some self-starters prefer the simplicity of white labeling and knowing they can always get the product they need without worrying about higher prices or testing.
On the other hand, plenty of entrepreneurs prefer private labeling because they can get more creative and hands-on with what they sell. In addition, private labeling allows you to customize your formula, which gives you an advantage and helps your brand stand out. However, private labeling comes at a higher price, so it’s not always affordable.
