After losing some ground to branded products during the pandemic, private label is surging during inflationary times, as large food retailers move to take advantage.
In a survey by FMI – the Food Industry Association cited in the Wall Street Journal, more than 80% of respondents plan to increase their investment in private-label products. Kroger increased private-label sales in its most recent quarter by more than 10% year-over-year, during which it introduced 147-new store brand products. It plans to start a new value-conscious private label line. Walmart also expects private label sales to increase.
Branded products experienced something of a surge during the pandemic, as shoppers gravitated toward the familiar. But now that shoppers are pressed by inflation, major food retailers with established private label product lines see a greater opportunity.
They hope to bring sales more in line with European food retailing, where store brands account for a greater share of sales. Koninkijke Ahold Delhaize, based in Holland, owns the Food Lion and Stop & Shop supermarket banners in the U.S.; the share of private-label sales in its U.S. stores was 30%, compared with 50% in its Dutch stores.
