The Phoenix Business Journal features this article on a study from Arizona State University Private Brand and overall savings for shoppers. Not surprisingly the study found that Private Brands help shoppers save money
ASU study: Generics promote competition
A study conducted by a group of Arizona State University professors reveals that generic or private label supermarket brands can promote overall savings for shoppers.
Professor Timothy Richards is the Marvin and June Morrison Chair of Agribusiness and Resource Management at the W. P. Carey School of Business. Richards and several colleagues conducted the research, which is published in the Journal of Agriculture and Resource Economics. The research shows that even if a generic or private label brand isn’t a top seller, it serves as an incentive for lower prices overall in that category.
“Consumers benefit because the whole idea is for retailers to provide a value option to customers. Also, when grocery stores offer these competitive store-brand products, it forces the brand-name companies to lower the wholesale prices they charge the grocery stores. Part of the savings is then passed on to the customers who buy the brand names,” Richards said in a statement.
Sales of private label goods account for almost one quarter of all consumer spending on food, beverages and personal care items, the study further shows. And the more similar a generic product is to the brand name offering and the closer it is on the shelf to the product, the better sales are.
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