- Baby Non-Food Products
- Baking/Cooking Staples
- Household Products
- Kitchen Products
- Paper Products
- Personal Care
- Pet Products
- RESEARCH & AWARDS
With this attentiveness to hard work in mind, PL Buyer invited manufacturers in the private label industry to nominate the retail executives who they believe are deserving of this year’s annual PL Buyer Retail Executive of the Year Award. Folks were nominated based on how well they exhibit the essence of leadership, partnership and sensibility in private label retailing - in short, the MVPs of private label.
The number (and caliber) of nominations we received this year was phenomenal, proving that the bond between manufacturer and retailer is strong and growing within the private label industry.
Representing retail chains from all sides of the country, as well as from our neighbor to the north, this year’s PL Buyer Retail Executive of the Year Award recipients are especially talented in their respected positions.
The 2008 winners include Alan Fawell, division merchandise manager for Wal-Mart Canada; Jim Godwin, vice president of private label for Ahold USA; David Houlden, senior category director at Loblaws Inc.; Jeff Kruckman, category manager, health and wellness for Walgreen Co.; Grant Pill, vice president of store brands for CVS/Pharmacy; Jason Reiser, category manager at Sam’s Club; Mark Schliff, category manager, HBC at Wegmans Food Markets Inc.; Raymond Swain, vice president of corporate procurement for Smart & Final Stores LLC; James D. White, senior vice president of consumer brands at Safeway Inc.; and Rosemary Winicki, who has grocery merchandising responsibilities for Meijer Inc.
Because going the extra mile is a standard operating procedure for these folks, a handful of this year’s winners agreed to take part in a roundtable discussion regarding the private label industry and what it means to be a leader in a market of uncertainty.
Thank you to all who took part in the nomination process. And thank you to all who contributed to this year’s roundtable discussion.
Congratulations to all of this year’s PL Buyer Retail Executives of the Year!
PL Buyer: What is the state of the private label industry? And where is the industry heading?
Jim Godwin: I am going to address the health and beauty care and general merchandise portion of the private label industry when I say that the industry is not in a very strong condition at the present time. With the constant pressures of raw material increases, as well as transportation costs, our manufacturer partners have to work much harder for less profit than ever before. We are seeing unprecedented price increases across the board in all categories. We have seen some substantial contraction of the manufacturing community, with several major manufacturers going out of business. Unfortunately, the industry is headed in the direction of fewer domestic manufacturers, which is parallel with consolidation seen on the retailer side of the equation.
Raymond Swain: First of all, I do not look at the private label industry as being monolithic. For a significant number of retailers, offering private label products that are equivalent to national brands is still the mantra. This part of our business requires that both retailers and manufacturers focus on the basics: quality, costs and supply chain. However, I am excited to see some retailers taking a more progressive approach, with private label playing a much bigger role in their overall strategy to achieve superior profitability and increase customer loyalty. Some of the more progressive private label initiatives include the introduction of natural, organic and lifestyle products; the development of “corporate/signature brands” that define a category; and the development of unique and exclusive products. This is where progressive retailers will differentiate themselves and where the real growth opportunities exist.
James D. White: Consumers are looking for high-quality, value-oriented products and brands. There are also more value-added brands that solve key consumer needs, like O Organics, Eating Right and Signature Café meal solutions.
PLB: How important are retailer/manufacturer partnerships in today's market?
Godwin: Retailer/manufacturer partnerships have increased substantially in importance in today’s marketplace. The industry can no longer function in an adversarial mode in which retailers control all of the sales real estate and the manufacturers control all of the products. Retailers and manufacturers must work together to ensure profitability in both camps. We must work together to drive out any and all unnecessary costs to the supply chain in order to remain competitive in today’s retail environment.
Swain: Good retailer/manufacturer relationships are an important tactic for success. Good relationships ensure that both sides understand each other’s objectives. This allows manufacturers to develop products and programs designed with the individual retailer in mind. It is much more efficient and productive to work towards defined goals rather than using cookie-cutter solutions.
White: [It is] very important that supply partners/co-packers bring a level of category expertise, consumer insights and product development capabilities to the relationship. More integrated and strategic relationships allow for stronger brand building and innovation, driven by true consumer and household insights.
PLB: In what areas of the marketplace does private label excel? In what areas could the industry use some improvement?
Godwin: Private label excels in commodity-based categories. There are several categories in which private label is the only player.
Swain: The private label industry excels at providing national-brand-equivalent products at a very good value for the consumer. Although that is not the most glamorous part of any program, it is the cornerstone of generating trust. National brand quality is declining in many categories, and this provides private label the opportunity to further push its quality message. Many retailers are being increasingly creative in product and brand development. Also, private label is now becoming more than just a center-store program by offering more compelling perishable offerings.
Although much better than 10 years ago, package design is an area where retailers can invest to improve the perception of innovation and quality.
White: Raise the bar for the retail food sector. Set our goals to excel beyond the quality and innovation of national brands. We are working to develop unique branded consumer solutions that address key lifestyle needs.
PLB: What are the keys to a successful private label program?
Godwin: First and foremost it is consumer trust. The consumer must believe in the quality of ALL of the products under a chain’s control label. Any weakness or poor quality in any one item translates to distrust in all other categories. A ranking of keys to success would be 1.) Quality, 2.) Reliability, 3.) Price.
Swain: Quality and consistency are paramount. This means that if I am marketing a quality or unique brand, my customers had better agree that I have met the expectations of the brand.
Customer trust and acceptance of a private label brand [are] required before a retailer can grow that brand to provide the main objectives of any private label program: enhanced profits, differentiation and customer loyalty.
On a more strategic level, a successful private label program will be fully imbedded in the culture of an organization. This means having a plan for private label that includes a penetration goal and that markets the brand to both consumers and the retailer’s associates.
White: Successful collaboration and consumer insights. You need strong insights of your specific consumers and shoppers as [they relate] to specific categories. Not only should you know how consumers respond to products within a category, but it is also important to know how consumers react within the store itself.
PLB: What trends are impacting the private label industry the most?
Sustainability and impact on the environment are going to be more important in all categories of consumer goods in the future. As an industry, we need to continue to look for ways to lessen our impact on the environment in every stage of the supply chain.
White: Customers are looking for value and are not willing to sacrifice quality to get it. This leads to the creation of more health and wellness products and more lifestyle brands like O Organics and Eating Right.
PLB: What keeps you dedicated to the private label industry and working with suppliers?
Godwin: The true partnerships that we have grown with our supplier partners make it much easier to develop exciting, cutting-edge products that offer our customers a great value on a daily basis. We wouldn’t be able to accomplish this without the great group of manufacturers we currently work with.
Swain: Twenty-eight of my 38 years in this industry have been focused on the private label segment. I enjoy the entrepreneurial spirit of private label suppliers. The ability to be creative and develop unique, quality products is unlimited. This industry is blessed with some really good people, and I have been fortunate to deal with many of them.
White: There are endless opportunities for growth and innovation in private label. I still believe that we have just scratched the surface of how we can meet the needs and desires of consumers.
PLB: What do you like best about your job?
Godwin: The satisfaction that comes from developing quality products for our many customers.
Swain: I like many aspects of my job. Developing creative solutions that support my company’s strategic positioning is both challenging and fun. I also am surrounded by an extremely talented staff that makes an impact every day.
White: I have the pleasure of working with the most talented, creative and enthusiastic people in the business.