Whether supplying food and beverages in bottles, boxes, bottles or bins, suppliers have the choice to brand their products, sell them as bulk commodity, or both.
What is a brand?
The word “brand” can be confusing. Besides being valuable intellectual property comprised of a unique tradename, logo, color palate, fonts, and other graphic design imagery, a brand is a marketing tool that helps your customers, employees and other stakeholders identify and remember your products or business.
The logo and other graphics are also the visual representation, or brand identity, of the qualities for which your company and products are known. A brand provides a memorable way for your stakeholders to differentiate your products from your competitors.
Should you create a brand?
Branded products can command higher prices at retail, especially when consumers have good experiences with your products. Even companies selling fruit as commodities can increase sales when they are recognized (aka branded) for providing consistent quality, service, and value. Whether for product or company, creating a brand that can command premium prices and margins requires investment.
A few branding considerations …
- Business Goals
Will having a strong, unique brand help achieve better competitive positioning, margins, and growth? Would developing a brand increase the value of your business to future generations or potential investors/buyers? How do these considerations factor into your short- and long-term goals?
- Sales Channels
Do your customers and potential customers demonstrate a preference for branded products, private label, or commodity fruits and vegetables? Are you selling through to foodservice buyers, wholesalers, distributors, retailers, or direct-to-consumers? Would having a brand aid in telling your story and differentiating your company from competitors? Does it make sense from an ROI perspective to invest in developing, marketing, and protecting your brand?
- Competitive Environment
How do your operation and products compare to your competitors? Is it typical for your competitors to sell branded products, or is a majority bulk commodity? Are existing brands well designed with solid reputations and customer relationships, or is the bar set low? Is there a gap or opportunity in the marketplace for another branded product that could solve a problem or add value for your customers?
- Upfront and Ongoing Costs
You don’t need a Wonderful Company-sized budget to develop a brand for your products. While you can find a freelance or offshore resource to design a logo for just a few hundred dollars, we don’t recommend it. There are too many risks around infringing on existing trademarks, and wasting money on resources who don’t understand your sales channels or don’t know how to design for reproduction on bags, stickers and cartons.
You should plan for an initial budget of $6,000 – $12,000 depending on if you need a name, logo, tagline, and other assets developed. Plus, you should have your lawyer assess the risk and give an opinion on the viability of the new brand, then submit it to the US Patent & Trademark Office to be protected, all of which add costs. Packaging design, sales and merchandising materials, and other marketing expenses will also be needed to successfully take your brand to market.
The investment to maintain and grow a brand can take companies by surprise. Consumer-facing brands require nurturing and support. If you want your company to be known as a premium brand, you might have to increase customer service and quality control. You’ll also need to promote the brand you have created to maximize its value and potential.