Retailers: Collaborate for Private-Label Success

CAROL ANGRISANI

NEW YORK — Wegmans Food Markets recently had a disagreement with one of its private-label suppliers over slower-than-expected sales.

But it didn't go as one would expect. Rather than blaming each other, the supplier offered to assume responsibility — and so did Wegmans.

It's that kind of relationship that makes such partnerships successful, Wegmans' Chief Executive Officer Danny Wegman said in a roundtable discussion at the Food Marketing Institute's Private Brands Summit here last week.

“We have a trusting relationship with our private-label suppliers,” Wegman said.

Wegmans deals with its store-brand suppliers differently than its national-brand manufacturers. While some assume this means having more frequent business meetings, the opposite is true.

That's because, through its relationship with private-label broker Daymon Worldwide, the retailer and its vendors are in sync as to what both parties want.

For Hy-Vee, West Des Moines, Iowa, retailer-vendor collaboration means building sales of the entire category, not just the supplier's own products, said Ric Jurgens, Hy-Vee's chairman, CEO and president.

“We want to grow the total business, rather than shift sales from one supplier to another,” Jurgens said.

More than 300 retailers, manufacturers, brokers and others attended the inaugural Private Brands Summit.