Retailers have the opportunity to expand their private-label products into more categories, delivering superior quality, convenient pre- and after-sales services and personalised experiences throughout the consumer shopping journey.
Laurel Gu, Director, China Insights
Market Definitions
Private label: refers to products sold under a retailer’s own brand name or a brand created by the retailer, developed in-house or produced by a contracted manufacturer, eg Sam’s Club’s (山姆会员店) Member’s Mark, Aldi’s Value range, FamilyMart’s Yummy Selection, Yonghui’s (永辉) YH Selection and Pangdonglai’s (胖东来) DL range. By selling private-label products, retailers can eliminate intermediaries such as distributors and agents, work directly with manufacturers, reduce procurement costs and generate higher profit margins.
Manufacturer brand: refers to brands created by professional manufacturers and widely sold through multiple channels, with ownership clearly belonging to the manufacturer.
This Report focuses on retailer types including traditional supermarkets and hypermarkets, convenience stores, membership stores, discount stores, speciality retailers and ecommerce platforms selling fresh food and daily necessities. Product types include, but are not limited to, fresh and prepared food, packaged food and drinks, beauty and personal care (BPC), health supplements and household cleaning products within the fast-moving consumer goods category.
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Executive summary
- Key issues in this Report
- Definitions
- What you need to know
- Opportunity: growth potential extends beyond food and drink
- Graph 1: private-label purchasing behaviour and satisfaction levels, by category, 2025
- Opportunity: deliver value for money while meeting demand for quality upgrades
- Opportunity: dive into lower-tier cities’ blue ocean market with locally inspired, word-of-mouth products
- Winning strategy: build a good reputation based on value for money, pre-sales experience, after-sales service
- Trend outlook
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The market
- Market trends
- Private labels enter golden growth phase in China as retailers’ investment in product innovation grows
- Graph 2: private labels’ share of new launches*, 2000-25
- Graph 3: average number of new private-label products developed per retailer per year, 2022-24
- Changes in retail landscape drive private label development, innovation
- Graph 4: retailers’ share of new product launches*, by type of retailer, 2016-25
- China: huge growth potential compared with Europe, United States
- Strategic development directions for retailers’ private labels from a global perspective
- Market factors
- Macroeconomic overview
- Consumer confidence rebounds after fluctuations
- Graph 5: confidence index* for an improving financial situation in the next three months, 2020-25
- Graph 6: confidence in an improving financial situation in the next three months, 2020-25
- Supermarkets undergo structural shifts to meet demand for affordability, engaging experiences
- Under economic pressure, private labels offering the same quality at lower prices become the smart choice…
- Graph 7: attitudes towards value (index*), 2024-25
- Graph 8: distribution of new product unit prices in food and drink categories, by brand type, 2024-25
- …which may affect retailers’ positioning and product selection strategies
- Beyond low prices: retailers’ reputation, word of mouth help win over quality-focused consumer groups
- ‘Carefully selected’ and ‘premium services’ are emerging as differentiated selling points, helping retailers build trust
- Retailer-owned data, AI tools accelerate innovation, iteration of private-label products
- Graph 9: attitudes to the use of AI in food and drink product development – % agree, by region, 2024
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The consumer
- Summary
- Private-label product purchasing behaviour
- Private labels are a hit among shoppers in membership supermarkets, nationwide retail chains
- Graph 10: private-label purchasing behaviour, by type of retailer, 2025
- Graph 11: private-label consumer share, by type of retailer, 2025
- In nationwide supermarket chains, membership stores, private labels appeal to high-income households, residents of Tier 1 cities, women aged 25–39
- Graph 12: consumers of private-label products – nationwide supermarket chains/hypermarkets, by demographic profile, 2025
- Graph 13: consumers of private-label products – membership-based supermarkets, by demographic profile, 2025
- Fresh food e-commerce platforms attract Post-1980s consumers, while neighbourhood fresh produce stores can target Post-2000s shoppers
- Graph 14: consumers of private-label products – fresh food e-commerce platforms and neighbourhood fresh produce stores, by generation, 2025
- Retailers’ private labels poised to branch into more categories
- Graph 15: satisfaction with retailers’ private-label products, by category, 2025
- Graph 16: private-label purchasing intent – repeat vs one-time purchase, by category, 2025
- Current hotspots in private-label innovation: food and drink
- Graph 17: private-label products’ share of new launches, by category (top 10), 2019-25
- Graph 18: private-label products’ share of new launches, by super-category, 2019-25
- Convenience is key opportunity for private-label food and drink innovation
- Graph 19: share of new private-label food and drink launches* – ease of use, 2019-25
- Reasons not to repurchase: food and drink products need guaranteed freshness, lower prices, stronger quality control and after-sales service
- Reasons not to repurchase: personal care, household cleaning products should avoid exaggerated claims, clearly define functional positioning, strengthen efficacy verification to enhance product experience
- Purchase consideration factors
- Value for money is core strength; build private-label credibility with joined-up system of product trials, after-sales support
- Graph 20: key private-label purchase factors, 2025
- High-income consumers value product information transparency, exclusivity
- Graph 21: key private-label purchase factors – monthly household income over RMB24,000, 2025
- Attract consumers in Tier 2, lower-tier cities with products incorporating local cultural characteristics
- Graph 22: private-label purchase factors – culturally localised products, by city tier, 2025
- Draw on local colour to create differentiated products with cultural depth, emotional value
- Food, drink product development can take cues from localisation trends in street drinks
- Product features worth paying a premium for
- Retailers can upgrade private label quality in a variety of ways
- Graph 23: private-label products – premium features, 2025
- Attract high-income consumers with organic certification, unique varieties
- Graph 24: private label products – premium features, by monthly household income, 2025
- Consumers in Tier 2, lower-tier cities willing to pay for premium packaging
- Graph 25: private-label premium features – high-end packaging, by city tier, 2025
- Trust in different retailers’ private-label brands
- Yonghui, JD.com and RT-Mart most trusted by the general public, while high-income consumers prefer Sam’s Club, Freshippo
- Graph 26: trusted retail brand names, by monthly household income, 2025
- Sam’s Club, Freshippo build consumer trust, boost reputation through high quality, value-for-money private-label products, comprehensive pre-and after-sales service experiences
- Graph 27: private-label purchase factors – Sam’s Club vs Freshippo vs all shoppers, 2025
- New retail formats such as paid membership stores, fresh food ecommerce platforms, convenience stores need to expand to lower-tier cities
- Graph 28: trust in bricks-and-mortar retailers’ private-label brands, by city tier, 2025
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COMPANIES AND BRANDS
- Overview of private-label development by leading retailers
- Competitive Strategies
- Sam’s Club: extends, deepens supply chain integration to deliver ultimate value for money
- Sam’s Club: social media helps private-label products break through
- Freshippo: slashes prices of key hero products; develops high-quality, differentiated products led by trends
- Freshippo: positions win-win cooperation an important direction for future development
- Dingdong Maicai: refines its brand matrix to ensure every type of consumer need is clearly met
- Mingming is Busy*: leverages private labels to tackle homogenised competition, while accelerating category expansion, store upgrades
- Aldi: offers full coverage of everyday life occasions
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Appendix – methodology and abbreviations
- Methodology
- Methodology: TURF analysis
- Research methodology: confidence index calculation
- Abbreviations
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