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Private Labels: A Mechanism For Fulfilling Consumer Demand For Healthy Food?

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  • Weaver, Robert D.
  • Moon, Yongma

Abstract

As consumer preferences rapidly evolve with respect to health-related attributes of food, many have questioned the performance of the conventional food industry to fulfill new demand. As the structure of the industry has shifted toward conditions where retailers have access to and incentive to respond to rapidly changing information concerning consumer preferences, it is relevant to consider the conditions under which retailers will offer private labeled healthy food products not available from national brand manufacturers. This paper presents a theory of the dynamic, stochastic decision of retailers to offer private label products that are close substitutes to national brands. Within the context of salient features of healthy foods, we examine the role of uncertainty with respect to consumer demand, the relative unit cost of private label vs. national brand products, and the optimal pricing of the private label products.

Suggested Citation

  • Weaver, Robert D. & Moon, Yongma, 2010. "Private Labels: A Mechanism For Fulfilling Consumer Demand For Healthy Food?," 115th Joint EAAE/AAEA Seminar, September 15-17, 2010, Freising-Weihenstephan, Germany 116397, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaa115:116397
    DOI: 10.22004/ag.econ.116397
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    References listed on IDEAS

    as
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