Is Producing a Private Label Counterproductive for a Branded Manufacturer?

Bergès, Fabian and Bouamra-Mechemache, Zohra (2009) Is Producing a Private Label Counterproductive for a Branded Manufacturer? TSE Working Paper, n. 09-130

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Official URL: http://tse-fr.eu/pub/22262

Abstract

Branded food manufacturers vindicate the use of excess production capacities (idle otherwise) to justify their production of retailers' brands. We study the distributor and food manufacturer's private label strategy for production within a framework featuring endogenous store brand quality, bargaining power, possible differences in production technology and potential capacity constraint for the branded manufacturer. According to the structure of capacity constraint (applying to both products or private label only), the retailer may prefer to choose an independent firm whereas he selected the branded manufacturer when unconstrained. The conclusions of our article thus partially confirm branded manufacturers' thinking: they may produce store brands when they are not capacity constrained

Item Type: Monograph (Working Paper)
Language: English
Date: December 2009
JEL codes: L11 - Production, Pricing, and Market Structure; Size Distribution of Firms
L13 - Oligopoly and Other Imperfect Markets
Q13 - Agricultural Markets and Marketing; Cooperatives; Agribusiness
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Site: UT1
Date Deposited: 18 Jan 2012 06:01
Last Modified: 07 Mar 2018 13:22
OAI ID: oai:tse-fr.eu:22262
URI: http://publications.ut-capitole.fr/id/eprint/3304

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