[Marketing Terms]White Labelling

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If a product produced by a company is re-branded and marketed by another company, then such a product can be called as a white label product.

There exists a variety of reasons for firms to go with white labelling. Sometimes they find it more economical to pay someone else to produce things, rather than going for self production. This may be due to lack of specialist knowledge, skills, local sourcing or adequate equipment  Also certain companies don’t have government licence or registration for carrying out production processes. Small banks asking for large banks to handle their credit card operations is an example for white labelling in finance industry. The advantage is that small banks find it cost saving than dealing the same with themselves. Another advantage for white labelling is that producers can have access to wider markets and also distributors can keep away from research and development costs for producing new products.

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