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The Effect of Private Brands on Business Performance in Retail

Author(s): Radojko LUKIĆ

Journal: Economia : Seria Management
ISSN 1454-0320

Volume: 14;
Issue: 1;
Start page: 25;
Date: 2011;
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Keywords: brands | market share | customer perception | price | gross margin | marketing costs | profit.

In the length of time many new retail features were developed, as a part of the total value chain (from manufacturer to customer). One such feature is: the development of private brands (private-label merchandise, private-label brands, store brands, house brands, own brands). Because of economic importance, both in theory and in practice, more complex stress was put on its research from various perspectives: the individual countries and regions - geographic, retail companies and formats (types of stores), product categories, as well as from the perspective of the perception of customers / consumers. In the context of it, special empirical emphasis was placed on the effects of private brands on business performance in retail, in particular, on cost, gross margin, profit, in other words, on profit indicators, such as: rate of profits from sales, profit rate of assets and the rate of profit of the share capital. Having such starting point, this paper attempts to, as thoroughly as it can, primarily empirically, investigate the impact of the development of private brands in the retail business performance. Using the latest available relevant data gathered from various scientific and professional sources, including well-known agencies that primarily conduct empirical analysis of private brands in some countries, companies and retail formats and product categories. The results should serve as a reliable basis for creating the most efficient strategy for managing the development of private brands in order to improve business performance in retail. This is especially true of the so-called "emerging market" private brands, as it is the case with Serbia.

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