Retailers cannot control the price of aluminum, cocoa, freight or imported merchandise. They have considerably more control over what happens next when the product carries their own name, and that is becoming one of the less discussed advantages behind the continued growth of private label. Store-brand sales reached a record $282.8 billion in 2025, according to the Private Label Manufacturers Association, while store brands captured 23.5% of unit sales and 21.3% of dollar sales. The momentum has continued this year, with private label reaching a record 23.8% unit share during the first half of 2026.

But the more interesting number may be price. Store-brand dollar sales were essentially flat during the first half while unit sales continued to increase; national-brand dollar sales rose 2.2% even as unit volume declined. Those numbers do not tell us exactly how much cost retailers or their suppliers are absorbing, but they do show something important. Private label continues to gain volume without depending on the same degree of dollar-price growth. For procurement and finance teams trying to manage inflation without losing increasingly price-conscious consumers, that flexibility has value.

Owning the Brand Creates More Levers

When a national-brand manufacturer raises its wholesale price, the retailer can negotiate, change promotions, adjust assortment or alter the shelf price, but much of the product itself remains outside the retailer's control. Private label changes that relationship: the retailer can work directly with manufacturing partners on sourcing, packaging, formulation, specifications, volume and production arrangements. Not every product can be changed easily, and regulated categories introduce additional constraints, but collectively, those options create more ways to respond to higher costs than simply accepting or rejecting a manufacturer's price increase, turning private-label procurement into a form of cost management that looks a lot like the uneven pass-through already showing up across supplier relationships more broadly, where some costs get absorbed and others get passed straight through depending on who has the leverage to decide.

If packaging becomes substantially more expensive, the retailer can examine packaging. If an imported ingredient becomes exposed to tariffs, procurement can evaluate alternative sourcing, the same underlying question of whether a supplier can keep delivering at the price it quoted that buyers everywhere are now having to ask. If freight changes the economics of a supplier relationship, production can potentially move closer to the market. And when none of those options makes sense, the retailer can decide how much of the increase it is willing to absorb to preserve the value proposition.

The Price Gap Is an Asset Worth Protecting

That value proposition matters. PLMA estimates consumers saved approximately $35 billion in 2025 by purchasing store brands instead of comparable national brands, and that savings is one reason private label has continued taking market share. For retailers, maintaining the gap between national brands and their own products therefore becomes more than a pricing exercise. It is part of customer acquisition and retention, and the growth figures suggest consumers are responding. Through August 9 of 2026, shoppers purchased roughly 43 billion store-brand units worth $174 billion, with private-label units up 0.3% while national-brand units declined 0.7% over the same period. The challenge for procurement is protecting those economics as supplier costs change, but private label also gives retailers tools to do it.

Supplier Relationships Become More Strategic

There is another positive consequence. As private label becomes a larger business, the relationship between retailers and contract manufacturers becomes more important, and the conversation can move beyond negotiating the lowest unit price toward identifying where costs can actually be removed. Longer commitments can give manufacturers more production certainty. Larger volumes can improve purchasing economics. Product redesign can reduce material requirements, packaging changes can lower freight costs, and greater visibility into demand can improve production planning. That does not mean retailer and supplier interests always align, but a private-label relationship gives both sides an incentive to find an answer before simply passing every increase downstream, a dynamic that echoes how supplier contracts more broadly are being renegotiated to share risk rather than simply transfer it. That becomes particularly valuable when consumers remain price sensitive.

Private Label Can Turn Procurement Into Product Strategy

Retailers are already treating private label as more than a cheaper substitute. Target has been steadily adding hundreds of new private-label food and beverage items to its assortment, Walmart continues expanding its Bettergoods line and recently overhauled thousands of Great Value products for the first time in seven years, and Kroger, Albertsons and other major retailers are investing in proprietary brands as consumers become increasingly willing to switch away from national labels. As those businesses grow, procurement's role changes with them and the sourcing team is no longer simply purchasing somebody else's finished product. Its decisions can influence what the product contains, where it is made, how it is packaged, what it costs and ultimately how it competes on the shelf, which makes supplier-cost management part of product strategy.

Cost Volatility Makes Control More Valuable

Private label cannot insulate retailers from inflation. Manufacturers still face higher labor, ingredient, energy, packaging and transportation costs. Tariffs can still change sourcing economics, and suppliers still need adequate returns to continue investing and producing reliably.

But, retailers owning their brands have more choices about how they respond:

  • Absorb costs
  • Redesign products
  • Source differently
  • Negotiate directly with manufacturers
  • Adjust packaging or assortment
  • Pass some of the increase to consumers, when necessary.

That flexibility may become increasingly important as retailers try to balance affordability with margin protection.

For years, the primary argument for store brands was straightforward: they cost less. The more important advantage in a volatile supply environment may be that retailers have more control over why they cost what they do.