Chain store management through private labels strategy

The purpose of this paper is to examine the market shares of private labels in the European Union and on the global market, and to compare the results of the analysis with the level of presence of private labels on the Croatian market. Moreover, through the application of macro and microeconomic tools, the author tried to estimate the future trends of private labels in Croatia. For the purpose of the paper secondary and primary data was used in the research. Relevant scientific and professional literature of local and foreign authors was analyzed. In addition, a few recent research studies were analyzed and their results compared. Field research has been conducted by the survey method, with 225 respondents included in the intentional sample.The main hypothesis of the paper based on research is that, in total sales, private labels are gaining a growing share in all markets, regardless of the development level of those markets. Alongside the main hypothesis of the work, three supporting hypotheses were tested to see which private labels are a good alternative to other brands on the world market. Private labels are generally developed on generic products. The third supporting hypothesis starts from the assumption that the investments in the promotion of private labels are negligible, resulting in lower prices of those products. The results of research and analyses in the work indicate that the position of private labels will strengthen internationally, as part of the process of liberalization and globalization of trade flows. In the process of purchase of private labels the positioning of the point of sale and price have an increasing contribution. With the concentration of commerce in chain stores, the share of private labels grows, approaching a half of the total sales in some countries. Considering the Croatian market, according to the international product life cycle theory, the share of private labels in the total sales will grow in the future with the expansion of the national chain stores.