storebrands

Some Store Brands and National Brands Are The Same

Today I’m going to confirm a long running rumor about the products in your grocery store.  Many of you have already suspected that the store brands and the national brands held little difference.  Some of you actually continue to fall for national marketing practices and believe that because you pay a premium for certain foods produced by national brands, they must be better.  Well, I can unequivocally confirm that in many cases, the store brands have been produced by a national brand manufacturer and they are exactly the same product.

Most of you remember that I changed jobs a few months ago.  The company that I now work for is a manufacturer of a few food products.  You would never know the company name, but believe me, you know a few of their brands and chances are that you’ve eaten their products.

I had the opportunity to tour a couple of the company’s manufacturing facilities and then walk through the football field sized storage rooms.  What I saw left my mouth agape.  There were pallets full of boxes ready to be shipped around the entire country…and most of the boxes were labeled with store names, discount brand labels or were labeled for restaurants.

After a lengthy tour in one of the company’s facilities with the plant manager, he explained to me that there were thousands of SKU’s (those little bar code thingies) for thousands of variations of the same product.  I’ll give you an example: let’s say that my company makes potato chips (not true, but it’s just an example).  One company might like their chips to be a certain color, so the potatoes might cook a little longer.  Another company might like ridges on their potatoes, so they’d be cut with ridges.  Still another company might like their chips a little saltier, or perhaps they want their chips to use kosher salt instead of regular table salt.  With all of the changes and variations that you can mix and match, each product for each customer might appear to be completely different, when the base product is exactly the same.  This happens with millions of item every single day.

Haven’t you ever wondered, how is my local [insert your own grocery store name here] able to produce so many different items?  Or why is it that only Costco or BJ’s able to carry certain products in huge sizes? It’s because they contract with the manufacturers to produce certain products in the larger bulk sizes.

Like Len Penzo’s fantastic series, some of you have done your own little taste tests and confirmed that sometimes the store brands are just as tasty, if not better than the national brands.  That’s just because of the formulation that the store chooses.

Before you go thinking that all national brands produce store brands, I’ll tell you now that that is not true.  Many national brands have not and will never produce packages for others.  Some companies have even taken to labeling their products to state that they do not produce store brands.  It’s their way of keeping their brand equity and their ability to command a higher price.

Well, there you have it folks.  The next time you find yourself automatically reaching for the national brand, move your hand a little to the right and pick up the store brand, just once.  The lack of a difference in taste might just surprise you, and your wallet will thank you for the savings.

Just don’t tell them that I told you.

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22 Comments

  1. I heard this rumor years ago, and I always wondered if it was true. Now that it’s been confirmed by someone in the biz, I’ll always buy storebrand from now on…unless the name brand is cheaper through a sale!

  2. I recently wrote a popular post for ketchup fans on No Name vs Name Brand Products where the same topic came up. It’s funny for most products its more about the packaging then the product itself. It’s all a mind game!

    I used to love Heinz Ketchup(still do) until I filled the bottles with no-name and you guessed it no one knew. The product was used no questions asked and cost a fraction of the price.

    You might even find manufactures package seconds(not perfect) of their products in no name packaging.

    Great Post! What I learned don’t always jump to the name brand, read the packaging you never know what you will learn.

  3. Wow…so you’re telling me that it’s possible that the only difference between a generic bag of chips and a name brand one could be a few seconds of extra crisping? Unbelievable!

    The one item where I do notice a difference and I’m not sure I can compromise on it: Toilet Paper.

  4. Totally off topic, but as a chemical engineer, a bunch of my classmates went to work in the food industry. One guy’s sole job (and he had a master’s degree), was to figure out how to incorporate more recycle (broken chips) into pringles.

    You did a very good job of explaining sku’s in layman’s terms. I think the national brands that I like the most like P+G don’t have equivalent generics. I’ve tried and I’ve always been disappointed. I’m generally not big on generic brands as I’ve been burned so many times with super crappy alternatives. Ugh..I can still vividly remember the gross mush that someone passed off as a can of tuna. It was uneatable..and I eat most everything. Throwing food away is much more painful to me than paying a small premium on something I know I like. I think the west coast supermarket have better quality generics than the stores I frequent back east. I always covet the stores len always seems to feature in his taste tests.

  5. I’ve always wondered this but I could see how true it was when I was in a large dollar store. Products such as shower body wash sold for a dollar in the same size bottle as Dove sold at the drug store for $9 a bottle. The funny thing is that they changed the name on the bottle but use the same colour scheme. Same for the bags of potato chips.

  6. I saw a Dateline or 20/10 where people were given samples of store brands and premium brands – like Kraft, Minute Maid, etc. – and asked which one they preferred. The majority of people couldn’t tell the difference, and most liked the generic stuff better! EVer since, we’ve been shopping generic for just about everything EXCEPT cereal. It’s the one thing I really can taste the difference between brand name and generic.

  7. I’ve known this for years – my ex MIL worked at a national chain of grocery stores, and told me which of their house brands were made by major label manufacturers. Made grocery shopping for quality food much cheaper!

    There are still a few taste differences with certain products, but then again, there are taste differences between brands too – I’m almost always willing to try a store brand at least once!

  8. The same thing happens in factories in China that manufacture electronics or things like high-end handbags or shoes. The reason why some fake branded electronics and fashions sold across Asia are of such good quality is that they are often made in the same factories as the originals.

    The factory workers make no distinction between officially licensed products destined for foreign markets and “fake” products destined for local markets. It’s usually the same product from the same factory using the same supply chains. The biggest difference is that the fake products don’t have any real quality control.

  9. My mother-in-law worked at a place that made several brands of potato chips……all the same product….different bags. A friend worked at a place that made yogurts……same product…different brand containers.

  10. Interesting; what are some of the types of foods where this either IS or ISN’T true? I heard from a classmate once (not sure if this is true or not) that generic cereal has a higher % of rat droppings since the cereal comes off the bottom of the vat compared to the store brand.

    • Ewww. That isn’t the case where I work. They run specific products for each company on different days or shifts because the packages including sizes are all different. We actually sell waste merchandise (things that fell off the line) to farmers for feed. The goal is to have zero waste.

  11. I kinda figured that out a while ago. It’s all about the labelling and the target market and perception etc. Good ol’ Marketing 101. I’ve been buying store brands for years and they work for me.

  12. I remember learning about this when I worked at the Vitamin Shoppe in College…Co-Workers would say that SOMEONE had to produce the supplements b/c it wasn’t like VS had its own MFGing plant.

  13. Just part of the outsourcing and specialization trend. There’s many a CEO that dreams of taking out all risks inherent with production and just having to sew the metaphorical button on the pair of Levi’s.

  14. I can usually tell the difference in certain brand name cookies of all places. Store oreos and brand oreos will never taste the same to me. Oh and my husband can taste the difference in American cheese singles (I don’t eat them much so whose to say) so he makes me by brand for that. But for everything else, I can’t. I’m rarely brand loyal – I go for what’s cheapest, whether that’s the store brand, or something else with a coupon. But I’m not at all surprised by this.

  15. So true! My Hubby works for a sugar manufacturer, and they put the same sugar in over 100 different brands of packaging. Also pharmaceuticals. My Sis was a vet tech for a while, and they toured a plant that made the same drugs, not only for different retailers, but also for animals! They all came off the same line, just different packaging.

  16. I buy generic whenever I can for savings. I can almost never taste the difference and if I have the generic for long enough I usually start to prefer the generic. Now that I know that they may in fact be the exact same product, it gives me little incentive to switch back to name brands.

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