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Sainsbury CEO: PL Keeps Brands Honest

July 25, 2012
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In an interview this month with a BBC radio broadcast called The Bottom Line, Sainsbury CEO Justin King said private label grocery products help keep national brands honest by offering consumers a true choice on the shelves.

“Own-label keeps brands honest in terms of the pricing they try to achieve and the quality they trade at,” King told the radio program, according to a report in Food Manufacture.

King said that London-based Sainsbury’s sales today were split almost evenly between private label products and name brand products, and that the grocer had a 130-year history of selling private label products.

“The Sainsbury brand on an own-label product reassures customers about certain things [such as product quality] because of our history and our approach,” he told the radio show. “So for us, the competition is like a branded competition at the shelf edge label.”

He told the radio show that the tension between retailers and name-brand manufacturers “makes everyone up their game and try to do better.”

King added that shoppers were more likely to buy branded products in packaged dry grocery items, and private label in fresh produce. But he does not believe that private label products are solely entry level options.

“It’s absolutely not the case that brands are one quality and own-label another,” he told the show.

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