Question

Safeway has continuously introduced new products to its Safeway Select brand label of groceries, like Select Cola and Select Soups. Why has Safeway chosen to build and expand its own in-store brand label

Answer 1

Answer:

Safeway has chosen to build and expand its own in-store brand label for the following reasons:

1. Exclusivity and differentiation:  Safeway knows that the in-store brand label makes the product exclusive to Safeway stores only.  Therefore, these products are differentiated from other products and can only be found in Safeway stores.

2. Competitive pricing:  Safeway is facing increasing competition from rivals, especially in the area of pricing.  To ward off price competition, it may decide to build its own in-store brands.

3. Improved quality:  Safeway can detect the highest quality for its own in-store brands, which it could not do, assuming that it stores the manufacturers' brand labels.

Explanation:

In-store brand labels are private label products manufactured by one company but are branded for and sold in another company's brand labels.  Many retailers have found the use of in-store brand labels attractive in recent years, given the increasing competition of brand products.