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Explaining National Brands and Private Labels Price Differentials: A Theoretical Model

  • Pedro Verga MatosEmail author
  • Rita Coelho do Vale
Conference paper
Part of the Springer Proceedings in Business and Economics book series (SPBE)

Abstract

In the rapidly changing business environment of today, retailers’ private labels, and its associated power, can be a critical element to help retailers distinguish from competitors and to compete with national brands manufacturers. The present research suggests that the price differentials between NBs and PLs can be explained simultaneously by two distinctive factors: (1) retailers power and, (2) specific product categories characteristics. To study this phenomenon, the authors propose a theoretical modeling approach to estimate across multiple categories and retailing chains these two effects. This model allows its application in markets with different concentrations levels, testing for the importance of the market structure in determining retailers’ power.

Keywords

Private labels Retailers’ power Retailing competition Product categories’ effect 

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Copyright information

© Springer International Publishing Switzerland 2016

Authors and Affiliations

  1. 1.ISEG—Lisbon School of Economics & Management, Universidade de LisboaLisbonPortugal
  2. 2.UCP—Católica Lisbon School of Business & Economics, Universidade Católica PortuguesaLisbonPortugal

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