7th June 2011 – Following intense interest in its report ‘Private label vs. Brands: an inseparable combination’ Rabobank has developed a model to answer the question from private label suppliers: to consolidate or not?

Private label is expected to double its market share to 50% by 2025. Not only will this growth change the appearance of retailers’ shelves, but it will also cause gradual changes in the competitive landscape for suppliers. The smaller B brand suppliers in particular will face increased competitive pressure. Rabobank analyst Sebastiaan Schreijen has developed a model to help private label suppliers answer the question ‘How important is this consolidation trend for the product category we’re active in?’

According to Schreijen there’s no single answer to that question but it is possible to draw some general conclusions, “Each product category is different and has to be assessed on its own merits. Our research maps different product categories along a maturity scale to reach some general conclusions regarding the pace of consolidation. The pace appears to depend on catalysts such as the interest of private equity or A brand presence, and typical hurdles to consolidation such as physical distance, consumer perception, ownership structures and barriers to entry.”