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The private label market in Poland continues to grow very dynamically. Retailers which have been selling products under their names for a long time now are expanding their private label range, while other players, such as Polish supermarket chains and small format stores, introduce the idea of private label to their offer.
Although private labels in the economy and medium price brackets are still dominant, retailers in Poland are launching private labels in the higher (premium) brackets as well. This shows that the market is becoming more mature and makes PMR expect that as the quality of private label products improves, so will the not-very-positive image of such products among Poles.
Discount stores offer the most
According to the PMR recent report “Private label in Poland 2008”, discount stores account for the largest chunk of private label sales in Poland. Up to 85% of their offer are products sold under private labels, which – according to our estimates – generate close to 66% of the total turnovers. These stores play important role in popularising private labels, especially at smaller towns. The popularity is also driven by the roll out of smaller format stores at less densely populated areas by hypermarket operators. In the coming years, supermarkets’ role in distribution of private labels should be increasing. In addition, as large groups such as Emperia Holding or Eurocash launch private labels at small stores, PMR expects that traditional stores will gradually be widening their footprint in the market of private labels
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Private labels in Poland are forecast to grow strongly, driven not only by the expected rising popularity of modern channels but also by the increasing consolidation of the traditional market. Furthermore, the improving quality of private label products in the lowest price brackets and expansion of more expensive lines should stimulate consumers’ interest in private labels. However, the growth may be thwarted by the negative image of private labels among Polish consumers and by the Polish buyers’ sentiments towards manufacturers’ brands, as well as the growing affluence of the Polish society.
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More and better
Over the last two years the market of private labels positioned in the medium price brackets grew significantly, while the lowest-price product range increased only insubstantially. The process was spearheaded by Tesco and Carrefour. The former expanded its offer of private label products in the medium price arena (Tesco line) from ca. 2,000 items in 2006 to 7,000 in early 2008. At the same time E.Leclerc more than doubled the number of products offered under the Wiodaca Marka label.
The private label market in Poland recorded growth not only in terms of number but also quality of the products. Today, besides entry level and medium price products, retailers in Poland offer also premium brands, which feature better quality, prices comparable to or higher than those of leading manufacturers’ brands, and packaging more attractive than the economy private label products.
As regards hypermarkets, private labels in the highest price brackets are offered by Tesco and Carrefour. Tesco premium products – Tesco Finest – were first marketed in 2007. In March 2008 the line covered some 170 items, mainly household products. Tesco Finest is available only in selected stores, mainly in big cities.
Carrefour’s premium private labels include Bio organic products imported from France, French food Reflets de France, and Carrefour Selection line.
Other premium private labels offered on the Polish market are Alma’s Krakowski Kredens and Plus Discount’s Specjaly Konesera.
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