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FLEXO Magazine : July 2010
Store Identity Meets Brand Identity B&W Packages Give Way to Polished, High-Gloss Images By Robert Moran Big business, easily recognizable and sought after names, solid growth potential... Store Brands, once dismissed as generic items carrying black-and-white labels, are generating what many now project to be $100 bil- lion or more in annual business. As a result, today ’s retailers have taken to leveraging brand equity and expending mar- keting muscle in promoting their very own custom designed products and packaging. Nielsen is talking about the phenomenon. Consumer Re- ports is too. Wall Street is watching. Statistics are supporting what’s being said. And in the world of flexography, a number of printers have purchased new, state-of-the-art presses and dedicated them entirely to private label runs. A good deal of the recent buzz on this subject comes from major retailers themselves. For example: John Rishkin, CEO of the International supermarket con- glomerate Ahold, which operates the Stop & Shop, PeaPod and Giant Foods chains in the United States, publicly states that the retailer launched more than 1,000 private label prod- ucts in its U.S . stores in 2009. He adds, “Ahold will continue to improve and expand our private label offerings in the U.S .” Steven Burd, chairman/CEO, Safeway Stores, America’s second largest supermarket chain, predicts that its store brand growth will continue to be better than that of national brands. “In all likelihood, our private label sales will outpace the growth of national brands even post-recovery... Volume suggests that people are still looking for value.” Tom Ryan, chairman/CEO, CVS drug stores, reports, “Private label as a percent of front-store sales increased 130 basis points to 16.9 percent. We introduced 457 new private label items in the first quarter and plan to add 1,100 items throughout 2010. In the Longs mainland stores, we increased private label to nearly 15 percent of front-store sales, up almost 900 basis points in the quarter. ” Meanwhile, Dane Twining, spokesman for the 3,000 member, New York City-based Private Label Manufacturers Association, observes that, “Store brands continue to grow in sales and volume in the U.S . market. Nearly one out of every IndustRy IndIcatoRs • Nearly one out of every four products purchased in U.S . supermarkets in 2009 was a store brand. • Private label food and non-food grocery sales in the U.S . are actually well north of $86.4 billion. • In many instances, shoppers no longer can distin- guish between national and private label brands. Photos courtesy Walmart. 16 FLEXO july 2010 www.flexography.org FLXO_July10_v2.indd 16 7/16/10 9:36 AM
Sustainable Summer 2010