Blurring lines between retailer, manufacturer
The increased demand for private-label brands on the shelves of many grocery stores may see retailers taking on the role of manufacturer, posing some difficult challenges in the fast-evolving retail world.
Maryla Masojada, MD at Trade Intelligence, said there was some risk of retailers taking on the role of manufacturer in the face of innovation. "Grocery retailers know their consumer better than the manufacturer does, as they are much closer to what the shoppers' needs are, and they are going to change the face of products on the shelf," said Masojada. "Private label is becoming a high priority for retailers and they are pushing their own products on the shelves because it makes them more margin, it differentiates them from their competitors." Pick n Pay launched more than 250 new private-label ranges last year to mitigate against the risk of loss of major suppliers and product ranges, while 650 products were relaunched with newly designed packing. Masojada said retailers had started to combine two stages of production through vertical integration, for the convenience of consumers and the retailers themselves. Boxer Superstores, owned by Pick n Pay, owns a sausage factory, which, acc...
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