[2023] What is White Label? Understand how it works

Do you know what white label is? This business model may be the one to get you started even if you don’t have any products yet!

Follow this article to the end and understand everything you need to know about white label.

What is White Label?

White label is a business model in which a company sells a customized version of a product or service which it didn’t manufacture (having bought from another company).

In this way, the operational structure, platform and logistics are the responsibility of the developer company. At the same time, the company that hires the service applies all aspects of branding and selling to the final consumer. 

White-labeling usually involves signing agreements with one or several suppliers, who will rebrand an offer or even sell the same offer for a different price, depending on the value of your brand or those suppliers. 

It is worth noting that the process is “closed”, that is, because it is customized, the service seems to be produced entirely by the brand that carries your name.

A very common example is in the technology area, where several SaaS (software as a service) companies and startups offer white label solutions so that other companies don’t have to worry about software development and infrastructure, but, at the same time, can sell their own product.

Few companies can afford to develop their own solutions from scratch. So with white labeling, it is possible for companies to launch their own brands on top of existing technology, taking into account all the high standards and new features of the industry.

Therefore, developing white label software can be an excellent option for organizations looking to outsource software development without sacrificing quality, saving time and costs, and focusing on branding and marketing. 

White label or private label?

An important question regarding the private label model is its exclusivity. 

Products are exclusive when they can only be obtained using the private label system. So even if the products are manufactured by an outsourcing company, their level of exclusivity does not change. 

Thus, products can be manufactured in a differentiated and authentic way even if they are not manufactured by the same company that resells them.

In this sense, while in the white label model a company supplies standardized and customizable products to several companies, in the private label it is produced exclusively for a brand that orders products and services from the proprietary company. 

In this way, there is no risk of finding a similar product in the competition.

In sum, white label solutions can help leverage your company’s unique brand to deliver a product or service, without investing in the infrastructure or building the technology around the solution. 

In that sense, building brand credibility is essential.

Using a white label platform to leverage a business can also help it appear more reliable and credible to customers, as your products/services can be easily accessible and perform well.