In the Prime of Their Lives
Distributors reap profits in this growing label niche
By Erik Cagle
Coca-Cola, Nike, Nintendo, IBM--all are megacompanies that consumers can readily identify by name. Their products and reputations are world renowned.
But what about companies that aren't as established, that sell their products or services on a smaller, perhaps regionalized scale? What distinguishes the product of Small Company A from the product of Small Company B?
Judging a book by its cover
Most consumers won't scratch the surface beyond the prime label adorning a product. And that's just fine with John Shanley, president of Labels West, Woodinville, Wash., whose company's specialty is prime labels.
"A penny more spent on the label to dress it up can mean a dime more on the cost of the product," Shanley said.
"Other than name-brand pro-ducts, consumers are going to go with the product that has the fancier label. It's easy to justify the expense of a high-quality prime label," he added.
A prime label is the main focus of the product it will be applied to, according to Shanley. Typically, he said, the label is identifying a retail item, such as a jar of jam on a supermarket shelf.
While these labels do contain useful information such as nutritional value, their main goal is to work the product's way into your shopping cart.
As common as prime labels are in the retail environment, there are relatively few distributors challenging the market.
Shanley believes some distributors may feel a bit intimidated about dealing with prime labels.
"Typically, it involves color and more intricate work on the design end," Shanley said. "There are a lot less companies out there that can do high quality. With a smaller amount of players, you can get high margins.
"The typical distributor is trained by a major manufacturer to sell business forms," he added. "As soon as you make the jump to a label that's going to be a piece of art, not just information, there's a lot more room for error. It's perceived to be more difficult, but its ink on paper, not rocket science."