Private Label, White Label and Full Custom: Which One to Start With

The three terms are not used consistently, so ask what changes

There is no industry body that defines white label, private label and OEM, and factories use the words differently. Some treat private label and white label as the same thing. Others use OEM for everything. If you compare two quotations that both say "private label" you may be comparing two different products.

So stop asking which model a factory offers and ask two questions instead:

1. How much of the formula can I change?
2. How much of the packaging can I change?

Every arrangement in this industry is a point on those two axes. The labels are just shorthand.

White label: an existing formula, your brand on it

The factory already makes the product. It is developed, it is stable, it has been run on the line before, and the documentation exists. You choose it from a catalogue, put your label on it and sell it.

What you get from this is speed and a low floor. Nothing has to be developed, so there is no formulation stage to wait through. Nothing has to be trialled on the line, because it has run before. Across our own ready-to-label catalogue the starting quantity is 100 units on the great majority of items — of roughly 1,600 listings, over 95% start at 100 — and starting unit prices sit around $1.50 for gummies, $2.30 for capsules, $2.50 for tablets and $3.00 for powders, before packaging. You can see the actual figures on each product on our products page.

What you give up is exclusivity. The same formula is available to other buyers, including buyers in your market. If your competitive position rests on the product being unavailable anywhere else, white label is the wrong model — not because the quality is lower, but because the premise does not hold.

The honest use of white label is as a market test. You find out whether anyone wants to buy the thing before you spend money making it distinctive.

Private label: an existing formula, adjusted

In practice most orders that get called private label are a base formula with changes. A different dose of the active. A flavour swap. A sweetener change to get sugar down. A different capsule shell so the product can be sold as vegetarian. Your own bottle, your own carton, your own artwork.

This is where most brands actually operate, and it is a reasonable place to be. You are not paying for development from nothing, but the product is no longer identical to what a competitor can order from the same catalogue.

The thing to understand about this middle ground is that not all changes cost the same. Changing artwork costs nothing at the formula level. Changing a flavour is usually a matter of trial samples. Changing the active dose can mean re-checking stability and re-doing the label calculations. Changing the delivery format — the same active, but as a gummy instead of a capsule — is not an adjustment at all; it is a new product on a different line.

Ask about each change separately rather than describing your product and waiting for one number back.

Full custom: a formula that does not exist yet

You bring a specification or a brief, and the formulation team develops something to meet it. Thirty of our 120 staff work in R&D, and more than 5,000 formulations have come out of that team, so the work itself is routine. What is not routine is the schedule: development is the one stage nobody can promise a date for at the start, because it ends when the samples are right rather than when the calendar says so.

Full custom is the correct choice when the product is the differentiator — a ratio nobody else uses, a format that does not exist in your category, a claim structure that requires specific ingredient forms. It is the wrong choice when you mainly need something to sell while you build an audience.

Side by side

	White label	Private label	Full custom
Formula	Fixed, as catalogued	Base formula, adjusted	Developed to your brief
Development stage	None	Sample rounds only	Full formulation work
Exclusive to you	No	Partly	Yes
Starting quantity	Lowest	Similar to white label	Set by batch minimums
Time to first delivery	Shortest	Slightly longer	Longest, and least predictable
Where the risk sits	Undifferentiated product	Change scope creeping	Development schedule

The row that surprises people is the fourth one. Moving from white label to private label does not usually raise the minimum much, because both are running formulas that already exist. The jump comes with full custom, and it comes from physics rather than policy — see below.

Which one should a new brand start with

Start at the white label or private label end unless you have a specific reason not to. The reason is not that custom formulation is difficult. It is that a new brand does not yet know which of its assumptions are wrong.

Almost every brand we have worked with changed something after the first run that it had been certain about beforehand: the flavour, the count per bottle, the price point, sometimes the entire format. Discovering that on a catalogue product costs you one order. Discovering it after paying for development and committing to a custom batch costs considerably more.

There is a sequence that works: start with something close to a catalogue product, sell it, learn what your buyers actually complain about and ask for, then spend development money on exactly that. By then you are not guessing.

The exception is a brand entering a category where the shelf is already full of identical products. There, a catalogue product gives you nothing to say, and you are better off developing something from the start.

Why the minimum rises when the formula becomes yours

Three things set the floor on any order, and only one of them is negotiable.

Equipment batch size. A blender or a gummy depositor has a minimum working volume below which the mix is not uniform. Below that volume the equipment does not produce a worse batch; it produces a batch you cannot certify. This number differs by line and it is not a commercial decision.

Raw material purchase units. Some actives are only sold in sealed drums. If the smallest drum makes 40,000 capsules, that is the floor for that active regardless of what you and we would prefer.

Packaging print runs. Printers have their own minimums, usually higher than anything the production line imposes. On many orders the label is what sets the real floor, not the product.

A catalogue product spreads the first two across every buyer who orders it. Your own formula does not, which is why the number moves. We work out where that floor actually sits for your format and packaging rather than publishing one figure — the reasoning is spelled out further in our FAQ.

How to tell what a factory is really offering

Two questions separate a manufacturer from an intermediary reselling someone else's production.

"Whose line does this run on?" If the answer involves a partner facility, you are talking to a trading company. That is not automatically bad, but it changes what they can tell you when a batch has a problem — the answer has to come from somewhere else. Our own lines are in one 30,000 m² building, with 15,000 m² of Class 100,000 (ISO 8) cleanroom, under one quality system.

"What documentation comes with the batch?" COA and MSDS should be a given rather than an upgrade. Ask what identity and potency testing is run, and who runs it. Ask whether batch numbers trace back to raw material lots, because that is what determines whether a complaint can be investigated at all.

Also check what the certifications actually cover. cGMP describes how the plant runs. FDA facility registration is a registration for a food facility, not an approval of any product and not an endorsement — any factory implying otherwise is telling you something about itself. GACC registration is the Chinese customs filing that lets goods leave the country legally. ISO 22000 and HACCP cover the food safety system. None of them make your finished product compliant in your market: that depends on your formula, claims and label, and the obligation sits with whoever owns the brand.

What to send us

For any of the three models, four things get you a real number instead of a range: the dosage form, the formula or a label you want matched, the first-run quantity you have in mind, and the market you are selling into.

If you are not sure which model you want, say that. It is a reasonable place to start, and the answer usually falls out of the first two questions in this article once someone asks them in order. Send the brief through our contact page and we will tell you which end of the range your project sits at, including when that means starting simpler than you planned.