What is White Labeling?

Ever dreamed of launching your own product line or expanding on what you already offer but felt overwhelmed by the logistics? White label products might be the answer you’re looking for. As a solo entrepreneur or small business owner, you can tap into white labeling to grow your offerings without the headaches of manufacturing. 

From skincare to software, white label products allow you to place your brand on pre-made items and sell them as your own. It's like having a secret business partner who handles all the production, leaving you free to focus on marketing, sales, and customer experience. 

What are white label products?

These are goods or services produced by one company but sold under another company's brand name. It's similar to buying a store-brand cereal that's actually made by a major manufacturer: You get basically the same product, but with different packaging and branding.

The practice of white labeling allows businesses to broaden their product lines quickly without investing in research, development, or manufacturing facilities. There are big pluses for both sides: The manufacturer gets to produce in bulk, while the brand can offer a wider range of products under their own umbrella.

You might be surprised how often you encounter white label products. That bottle of store-brand pain reliever? Likely white label. The same goes for many electronics, personal care, clothing items, and even food products. In the digital world, white label solutions are common, too. Think of website builders or marketing tools that companies rebrand as their own.

With an understanding of white label products, you can explore new opportunities to grow your offerings and stand out in the market. Below are some examples of types of white label products that solopreneurs and small businesses, specifically, can use to diversify.

Examples of small business white label products

Let’s say you’re a solopreneur, a maker of small-batch skincare items like facial and body creams and cleansers. You spend a lot of time making your products from scratch with all-natural ingredients. You’ve put considerable effort into branding and packaging, garnering a significant following in your community and selling items from your website as well as from a couple local health food stores. But as a one-person team, your ability to manufacture in bulk, or expand your product line, is significantly limited. 

White labeling provides you with an avenue to reach a larger audience and hopefully, larger sales. With a bigger business producing additional items for you—like shampoos and conditioners, shave creams, or makeup, all with your marketing, labeling, and packaging—you can create your own branded lines without the overhead and time investment of product development and manufacturing.

The same goes for innumerable products and the types of extensions solo operators and small businesses can add to their lines. Here are a few examples: 

• Hot sauce (“New flavor!”)

• Pet food (“Now selling leashes, collars, and accessories”)

• Coffee (“We’ve got mugs!”)

• Jewelry (“New hair clamps in store”)

• Essential oils (“Check out our diffusers and scented candles”)

• All-natural cleaning supplies (“Just added: sponges from recycled materials”)

The possibilities are practically infinite. If you can imagine it, you can probably white label it.  

Learn how to create custom merch without inventory

The white label process explained

White labeling is a straightforward yet powerful business approach. Here's how it typically works, in three short steps.

1. Manufacturer creates the product

The process begins with a manufacturer developing a quality generic (rebrandable, resellable) product that has demand from the market. This could be anything from phone accessories to craft beer. The key is that the product is designed to be easily customizable for different brands.

2. Branding and customization

Next, the manufacturer sells the white label product to various businesses. These businesses then add their own branding, packaging, and sometimes minor modifications to make the product uniquely theirs. This step transforms the generic item into a branded product that aligns with these brands’ images and target markets.

3. Distribution and marketing

Finally, the rebranded product is distributed and marketed as if it were the business’ own creation. The end consumer often has no idea that the product wasn't originally manufactured by the brand they're purchasing from. This allows a business owner to expand their product lines quickly and efficiently, without the need for researching, developing, and making the item themselves.

Leveraging white label products allows you to focus on your core competencies while still offering a diverse range of goods or services. It's a win-win situation that's reshaping how entrepreneurs develop products and open up new markets in today's fast-paced economy.

When does white labeling make sense?

There are several reasons why the decision to white label is a smart move for small businesses. From a basic standpoint, if a small brand is experiencing demand for a product that they don’t have the capacity to manufacture themselves, or if they don’t have the expertise to do it, that’s probably the spark they need to look at white labeling as a solution. Let’s look at some advantages white labeling presents for small businesses—and their customers.

Advantages for businesses

White labeling offers several advantages for solo entrepreneurs and small businesses:

• Reduced development costs and time-to-market

• Access to high-quality products without extensive R&D

• Ability to expand and test product lines quickly

• Capacity to rapidly scale the brand

• More focus on marketing and customer relationships rather than production

In short, white label products give you a way to build an even stronger brand presence while offering a diverse range of items to your customers.

Drawbacks to consider

White labeling isn't without its challenges. One major impediment is the lack of control over product quality and features. Since the manufacturing is outsourced, you may have limited input on product specifications. It’s important to find a manufacturer with products you’d use yourself, so you can continue to make a good impression on your customers. 

There's also the risk of reduced brand differentiation, as competitors may offer similar white label products. This can lead to increased price competition and potentially lower profit margins. 

One alternative to consider is private labeling, which follows a similar process to white labeling. Instead, a manufacturer creates and produces a product just for you and your brand. This ensures uniqueness, but can be more costly.

Impact on consumers

For customers, white label products often mean access to a wider range of options at competitive prices. However, they may also face inconsistencies in quality across different brands selling the same type of white label product. If uniqueness or the handmade quality of a product is important to a customer, white label products also make it harder for them to discover truly unique items. 

It's crucial to carefully vet your white label suppliers to ensure they're sourcing reliable, high-quality products that align with your brand values and customer expectations. Depending on the type of customers you’re targeting, consider how much you want white labeling to be a part of your business and whether it aligns with your mission and the value you provide to customers.

How to start your own white label business

Launching a white label business can be an exciting, profitable venture. However, it requires a high degree of due diligence and preparation. Here's how to get going.

1. Research your market

Begin by identifying a niche with high demand and relatively low competition. Analyze potential customers and their needs, as well as existing solutions, and other brands out there selling similar products. This research will help you choose items that will sell well under your brand. It’ll also help you understand how to differentiate from other brands in the same space (more on that below).

If you already have an existing business and customer base, you can also tap into their feedback. Consider common requests or items that would be complementary to your popular products.

2. Find reliable suppliers

Look for reputable manufacturers who produce high-quality white label products. Attend trade shows, search online directories, and network with industry professionals to find the right partners. 

Remember to thoroughly check out potential suppliers before committing. You should try out a product yourself before committing to making it part of your own offerings.

3. Develop your brand

It’s important to create a unique brand identity that resonates with your target audience. This includes a visual identity. 

• Designing a logo

• Choosing brand colors

• Selecting consistent design elements

• Art direction that coalesces these attributes

It also means crafting a compelling story. 

• What does your brand stand for?

• What’s its personality? 

• Do you have a mission statement? 

• What are your brand’s core values? 

• Who do you serve?

Give your customers something inspiring to feel about your brand, something to align themselves with that wins their loyalty. 

Perhaps most important: Your visuals and branding should differentiate your white label products from competitors, so you have a better chance to stand out and get noticed.

4. Set up your business structure

The legal aspect of starting a white label business is crucial so you don’t run into snags later. Decide on a business structure (e.g., LLC, corporation) and register your company. Obtain any necessary licenses and permits, and set up a business bank account. Consider consulting with a lawyer and accountant to ensure you're compliant with all regulations to do business where you live.

5. Launch and market your products

Once you've sourced your products and established your brand, it's time to put it all out there. You should develop a marketing strategy, one that possibly includes:

• A website (especially if you sell items online)

• Social media (Instagram, Facebook, TikTok)

• Content marketing (blog posts, videos, podcasts) 

• Paid advertising (Google ads, pay-per-click, display ads, and more) 

Use these platforms to build your brand’s personality and presence and communicate how you provide value to your target customers. It’s OK to start small if you’re just getting going—paid advertising usually comes later in the process for a business, for example. This will help you reach your target customers and start selling your white label offerings.

The white label strategy can be a big step up for your business. Whether you're a solopreneur or running a small company, it offers a unique opportunity to expand your product line and boost your brand without the hefty investment in product development. There’s a reason the practice is prevalent across so many industries: it’s efficient, scalable, and adaptable. Just make sure you’ve researched it exhaustively before you jump in with both feet.