The production of private distributor brands for resellers may allow a manufacturer to use excess capacity efficiently.

Question

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Private distributor brands, also known as store brands or private label brands, are produced by a manufacturer for a retailer. This arrangement allows the manufacturer to use its excess production capacity and sell the products to the retailer at a lower cost, which can then be sold under the retailer's own brand or label. This helps the manufacturer increase its sales and revenue while also helping the retailer offer a competitive product at a lower cost. Therefore, it is true that the production of private distributor brands for resellers can allow a manufacturer to use excess capacity efficiently.

The Production of Private Distributor Brands for Resellers May Allow