How important for your company is the production for the sector Private Label both for Polish, as well as foreign recipients?

- Above all, such production is important due to the fact, that recipients are dealers with huge selling potential. Production of this type gives the possibility of cautious utilization of a raw material, and its massiveness most of all allows to separate production costs equally and use the machine park effectively. The sales volume causes that even in small margins such production is profitable.
 

What was the main motive of entering into Private Label?

- As I already said earlier, the main motives were: sales volume, using the machine park and utilizing the raw mineral.

Does production for Private Label constitute a significant percent in your activity?

- We never regarded such production to be the main type. We have brands: “Ostrołęka” and “Milandia”. We mainly place emphasis of our activities on their development. From our point of view, it is more important to have a strong brand than Private Label production for chain recipients. The Dairy Co-operative “OSTROŁĘKA” is well-known and valued for the production of high quality products. Therefore, we decided only for the production of Private Labels, which are set on high quality. Otherwise, such production would not be profitable for us.

What changes in previous years have you observed on the Private Label marker in Poland and abroad?

- Most of all their promotion is at a higher and higher level. Clients are more and more aware of its existence. A novelty is also the fact that they are often not the cheapest brands anymore, especially in chains. Until now, own brands were treated as products that were to attract clients to the store by the price, which often did not entail the highest quality. In the last period, the change of attitude towards these brands by chains is noticeable. They strongly promote these brands and do not want clients to associate them with poor quality.

Is the Private Label market a developing market?

- I think that this market will continue to develop. Chains also understand the changes in clients’ tastes and try to adapt to them. Market research indicates that the client does not necessarily look for the cheapest products, also in large supermarkets. The most frequent reason for choosing to buy a given product is the good quality/price relation. Due to this, clients of chains are building their own brands, placing great emphasis on their promotion. They are also paying more and more attention to the quality of these products.

Why is it that Private Label products are perceived as worse than brand name ones?

- I think that not all Private Labels can be treated equally, just like not all recipients are exactly the same. Each has his own policy concerning their brand and each builds his own strategy. The quality of given Private Labels mainly depends on this. There are clients, who mainly search for the lowest price and those, who are definitely interested in the quality of the products. This diversity – as I have already mentioned – results from the various strategies of given clients. A negative opinion of Private Label products results from the fact, that until just recently, own brands were treated by chains as a magnet attracting clients with its low price. This often entailed the low quality of products. Clients have grown used to this and such an opinion has been formed. The truth is that some Private Label products at the moment are directed at a different segment of clients than those, who in purchasing are guided only by price. This causes a large diversity in quality between certain brands. In maintaining constant quality, the fact that one product is manufactured by a few producers from raw materials of different quality, often using varying technologies, doesn’t help. This diversity also influences opinion about Private Label.

Thank you for interview.
Maja Święcka