February 5, 2008
How Far Will Grocers Go with Store Brands?
Limited assortment grocers including Trader Joe’s, Aldi and Save-A-Lot emphasize store brands in store merchandising. More traditional supermarkets, which still rely heavily on national and regional brands, are putting more of a focus on store brands as consumer acceptance grows and competitive pressures squeeze margins.
With the economy hitting a rough patch and consumer prices rising in a variety of areas, some expect to see store brands become more important among consumers looking to save money.
According to the Private Label Manufacturers Association (PLMA), 16 percent of supermarket sales are generated by store brands.
Sherri Carnes, who shops at the Morcroft Harris Teeter, is among the growing number of consumers comfortable buying store brands. She told The Charlotte Observer, “They’re a lot cheaper and a lot of times you can’t tell the difference with the taste.”
Harris Teeter has expanded its store brand offerings to address the growing opportunity. “We see it as a great opportunity for our shoppers to have an alternative to conventional items and save money,” Jennifer Panetta, a spokesperson for the chain, said.
Mike Mannion, director of sales planning and corporate brands for Bi-Lo, told the Observer, a store brand “only benefits you if customers acknowledge and accept the brand. A poor private label can chase a customer away as much as a strong label can build loyalty.”
Discussion Questions: Will retailers increase the pace of new store brand SKUs if the economic news continues to be troubling? Do you expect to see retailers begin to deemphasize super premium and premium store brands for more value-priced products? Will consumers return to national and regional brands once the economy picks up or will they stick with retailer-controlled labels?
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This reminds me of the Cott’s cola phenomenon of what 10-15 years ago? It’s now being extended by the grocers I shop, particularly Safeway and Giant (Landover).
I think calling TJ’s store brand program a “store brand” is kind of a misnomer. Virtually everything they sell is store brand. They don’t carry competing brands, for the most part, in any category.
That’s not true for the mainline supermarkets.
But I find many of the store brand products, i.e. Giant’s Nature’s Promise (which they also provide to Giant Carlisle and I presume to other Royal Ahold holdings) to be excellent.
What store brand providers now need to do is market them like independent brands.
Do tastings, have out-of-home ads, etc, big time. Make it clear that the products are great and that the particular stores in the chain are the only place where people can get these great products.
Tell the stories behind the products. Etc. That’s what TJ’s does. It’s really quite simple.
I don’t know why this just hit me, but it seems the world is becoming very confusing….
Retailers want to become manufacturers and manufacturers are using the Internet to become retailers. Men want to become house husbands and women want to become CEOs. For that matter men want to become women and women are becoming men.
I don’t want to get too deep with this whole thing, but private label seems to be a “no brainer” for the retailer. The biggest requirement they have is to beef up their QA department. This can’t be underestimated, but the advantage of negotiating cost, setting retail, and building a unique consumer image so overwhelms the cost of adding a new function that it simply makes sense.
There is a scale factor in all this and I don’t know where volume reaches the economic point necessary for staffing QA. Some of this can be addressed by consortiums, but the unaffiliated retailer (if there is such a thing) is probably too small to take advantage. Everyone else is likely to expand their private label offering as the economy slows.
I find it kind of ironic that the accompanying article today is about the expansion of brand advertising. It is just that kind of visibility that makes consumers think they’re wasting their money to pay for brand products supported by huge advertising expenses.
Make a list of the stores with the highest percentage of private label products in their stores. Then make a list of the highest sales per square foot stores. Then compare the overlap. That should answer the question on where private label is going.
Private label is such an enigma. On the one hand, margins are attractive but on the other, it takes double the marketing push to get product out the door. Consumers still equate private Label with value so, in terms of the economy, expanding house brands is the way to go. As prices rise (raw goods, fuel, etc), brand names have no choice but to go up but with private label, there is (at least there should be) room to keep prices the same. So there is a competitive advantage to the house brand. Conveying the image of high quality and value is where the challenge lies.
It’s all about the label and many lines have done a great job of meeting and even surpassing the name brand in terms of image.
To add to the challenge, now is the time where chains can capture customers and make them regular purchasers of their respective house brand. A great example is Loblaws. They are going through a major marketing push for their organic baby food line. At the end of the commercial, Galen Weston says that there is no price difference from regular baby food. That goes a long way for the consumer especially when the psychology of bad economic times is on the customer’s mind.
The quality of store brands varies widely from store to store. Some stores offer premium store brands, while others offer bargain priced store brands that don’t measure up to national brands. Trader Joe’s seems to be the master of store brands. For almost every category, they offer a store brand. They do it with panache and humor and at good prices.
Recession or not, retailers need to maximize the value of each shopper. One way to do this is through store brands. During recessions, consumers tend to look for ways to save money. The current economic slump should be no different. The quality of a store’s brands will determine whether or not a consumer sticks with them when the economy improves.
Traditional supermarkets have already ramped up the activity behind their store brands over the past several years. Many are into natural and organic products, most have simplified their offerings to Value, National Brand Equivalent and Premium/Super Premium.
Additionally, in many retailers who have focused on Store Brands the share has grown even as the economy was strong and the Branded companies have pushed their products. The margin and penny profit that retailers can build into many of their products make them a very good ROI supplement in their marketing plans.
Will they push even more as gas prices and housing issues squeeze consumers? You bet!
With each economic slow down we do see a slight increase in sales in certain private label categories. However, for the most part, national brands will sustain themselves and it will be a mistake if major mass retailers and grocers go too far with reallocation of shelf real estate. The national brands and niche brands are still the entities that provide the markets pace, leadership, and retail chain revenue. With the exception of specialty markets such as Trader Joe’s, Whole Foods, etc, most stores need to stick with the current balance between national, niche, and store brands.
There is an old saying that if a consumer purchases a Private Label item and it performs to their expectation they will try others. If the second one does as well, they will try others. If the third item disappoints them they will stop buying the first two items.
To rush poor Private Label items into the market is a mistake. All expectations are that this economic slow down will be short lived. Our Private Label Buyer survey indicated one area requiring improvement is the time line from presentation to delivery. It is unlikely a retailer can start today and have new Private Label items on the shelf by the time the economy turns up. Retailers should monitor Private Label sales to make sure they are not Out-Of-Stock due to an increase in sales. Don’t waste the time to speed up new item launches.
Store brands offer value to the consumer, higher profits to the retailer and better supply chain scenarios to the manufacturer.
As a manufacturer, I would prefer to do store branding of our branded products every day! These translate into longer lead times, more stable ordering cycles and lower concerns about packaging, merchandising and promotions (there are none).
Best yet, savvy retailers are demanding that their store brands carry the same panache and offer the same level of quality as their heavily promoted cousins.
Store brands are here to stay, and will continue to grow and establish themselves whenever the economy becomes more demanding.
The food industry is evolving into marketing companies and producing companies. Much of what used to be company owned production has become contract manufacturing. This has afforded retailers with access to the very best production methods and packaging capabilities. When these capabilities–especially packaging–were controlled by marketing/producing corporations and the latest production capabilities were denied to retailers, then the marketing/producing corporations controlled the grocery shelves and market share.
Now, retailers have access to pretty much all the technology available and have developed some pretty spectacular PL products. Retailers have a singular advantage in that they know exactly what is selling in their stores. It is very easy for them to run a fairly accurate P&L on any anticipated PL product and make a great business decision with regard to introducing a PL product.
I believe Harris Teeter has three levels of PL in their stores. An economy brand, a national brand equivalent and a premium product. As the base of PL grows, it will allow for the development of even more PL product. I can tell you this: producers don’t care who cans this year’s crop of green beans, broccoli or corn. If a grower can get more for his crop by selling to a retailer who can afford to pay more to get the very best because his marketing and production expense is 30% less than a national brand then the raw material supply will move to the retailer. They have the power to control every category in their stores except alcohol, HBA and soft drinks. This will become more evident as retailers make the transition from store advertising to product advertising.
It’ll be interesting to watch Whole Foods’ results as consumers tighten their belts in the coming days. Our guess is that they will continue to thrive and that the Whole Foods lesson (Whole Foods as the flagship brand with their stores selling only brands that align with the flagship brand) will continue to prevail.
We really see the “tightening” happening in more frivolous purchases, like consumer electronics, gas guzzling automobiles, higher end restaurants and movie theaters.
You will always have to eat, and eating better is more than a trend.
Best-practice private label as a marketing strategy has moved so far beyond price-driven generics as to make the question almost irrelevant. Look to how Whole Foods, Costco, Safeway, Kroger and others are conceptually handling private label, and this should be obvious.
Private label grocery is similar to private label apparel. In both merchandise categories, some retailers’ goal is 100% private label (J.Crew), some retailers mix private label and famous brands (J.C. Penney), and some use private label only rarely (many local independents). Some private labels feature less-expensive copies (Sears) and some are innovators (H&M).
The Great Grandma of private label store brands is A&P and its long history of quality products.
A&P gave the customer the finest quality food and household products by manufacturing a lot of what they sold under Ann Page, Jane Parker, Sunnyfield, Sunnybrook, Iona, Sultana, Marvel and dozens of other labels.
Customers shopped A&P for many years because their house brands were just that good. The customer knew that Sunnybrook eggs were the highest quality, Grade A large, that Wildmere were grade medium size eggs and that Crestview were small eggs.
Such selection, such quality, such value. So while shopping the typical Aldi one can find inventive names such as Happy Farms butter and Tundra Liquid Bleach, the playbook had already been invented by A&P.
In these inflationary times, those retailers who can offer great quality private brand lines and great savings, stand a much better chance of earning customer loyalty with exclusive house brands.
The emphasis is on “quality” and “value.” No-name generics will not work in this kind of market. The consumer’s palate has become more discriminating over the last decade and only the best quality products at major savings will do.
ALDI and Costco are the two florishing ends of the spectrum here…Costco’s Kirkland/Kirkland’s Best PL is by far the best PL I have experienced. Given its superior quality and value for money, I would actually be open to paying more for it than for a brand.
For the others, PLs are simply a cheaper option and best fit into categories where there is no element of choice or taste.
Growing proprietary brands for differentiation is a good strategy in any business cycle.
Pushing “cheap stuff” under a store brand would be to repeat the strategic debacle that torpedoed private label in the U.S. in the seventies. Selling cheap food and selling proprietary brands are two completely different things. It took our U.S. industry thirty years to figure that out the first time. Let’s not regress.
The growth of Private Label products is expanding–that is true. But as consumers start to take on more and more of these PL items, how will the grocers make up for the loss of promotional dollars that line their coffers right now? It’s a double edged sword.
Is a new era emerging where the quality levels of private label products and national brands have become indistinguishable?
Retailers are more savvy today about the necessary quality levels needed to sustain private label sales growth both at lower and higher price levels. Successful new retail entries such as Trader Joe’s and Whole Foods now feature premium level private label products and have conditioned the environment for even greater of acceptance of private label. While the slowing economy favors lower priced products there is still a heavy demand for premium products particularly when favorable priced.
Both would seem to be opportunity areas.
People will buy what they find likable, pay what they think a likable product is worth, and many retailers have now become astute marketers. That trend places a burden on national brands to come up with new innovative offerings to try to catch consumers’ fancy in sectors where private labels do not exist. If national brands don’t or can’t, is a new marketing game forthcoming–or are retailers just trying to stay in the game by having their private labels dominate their shelves?
Not all Private Labels are equal…. The Trader Joe’s strategy is quite unique, permitting TJ to offer a full array of grocery items in a small, compact and simple to shop store format. Price-Value is exceptional and usually wins in any head-to-head comparisons. Once a product has the TJ label, it makes returns simple, no need for a receipt, a feature many of us prize–making them similar to other service leaders like REI and Costco.
The TJ Private Label approach cannot be imitated by most full-service grocers, at least not fully–cereal aisle will likely remain ‘a mile long’ with a confusing array of varying sizes and endless variations on the original cereal theme. And so on for the other aisles.
The one player that could take advantage of the TJ strategy is Whole Foods. This would insulate them from more direct comparison shopping and make Whole Foods even more special and the ONLY SOURCE for their labels, differentiating them from traditional grocers and permitting more pricing flexibility to keep the Value Consumer shopping, even in downturns.
The focus of this article is on saving money during difficult economic times via store brands. Yet the emphasis I see from stores themselves is not on potential family cost savings from purchase of basic private label goods, but a push for their more pricey “premium” PL products.
The local Safeway (still called Dominick’s) has recently beefed up (no pun intended) Saturday morning sample “tastings” of some of its premium prepared entrees and PL products accompanied by store coupons or limited time discounts.
Gaining customer confidence that the product is tasty and worth the money seems key to getting it into their carts for the first time. I would be interested in how much such freebies and coupons eat into the profitability of these products, but it seems necessary for developing a market for them in my area. But, why do stores in general not do more to advertise the cost benefits and uses of their basic PL offerings?
I think retailers will move to a tiered store brand approach. Each tier will have a role within assortment, pricing, promotion, and overall consumer value proposition.
Strong grocers will take a “manufacturer’s approach” when managing their store brands.
There seems to be a big theme in the comments so far–one is that PL with quality is a good idea, PL with mediocre quality is a bad idea. Grocery cost-cutting is not usually seen in an economic downturn–but you may see less expensive cuts of meat, less expensive wine, and so forth. Retailers should not expect a rush to private label, but a rich opportunity exists at any point in time to offer a quality product at a good price.
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This reminds me of the Cott’s cola phenomenon of what 10-15 years ago? It’s now being extended by the grocers I shop, particularly Safeway and Giant (Landover).
I think calling TJ’s store brand program a “store brand” is kind of a misnomer. Virtually everything they sell is store brand. They don’t carry competing brands, for the most part, in any category.
That’s not true for the mainline supermarkets.
But I find many of the store brand products, i.e. Giant’s Nature’s Promise (which they also provide to Giant Carlisle and I presume to other Royal Ahold holdings) to be excellent.
What store brand providers now need to do is market them like independent brands.
Do tastings, have out-of-home ads, etc, big time. Make it clear that the products are great and that the particular stores in the chain are the only place where people can get these great products.
Tell the stories behind the products. Etc. That’s what TJ’s does. It’s really quite simple.
I don’t know why this just hit me, but it seems the world is becoming very confusing….
Retailers want to become manufacturers and manufacturers are using the Internet to become retailers. Men want to become house husbands and women want to become CEOs. For that matter men want to become women and women are becoming men.
I don’t want to get too deep with this whole thing, but private label seems to be a “no brainer” for the retailer. The biggest requirement they have is to beef up their QA department. This can’t be underestimated, but the advantage of negotiating cost, setting retail, and building a unique consumer image so overwhelms the cost of adding a new function that it simply makes sense.
There is a scale factor in all this and I don’t know where volume reaches the economic point necessary for staffing QA. Some of this can be addressed by consortiums, but the unaffiliated retailer (if there is such a thing) is probably too small to take advantage. Everyone else is likely to expand their private label offering as the economy slows.
I find it kind of ironic that the accompanying article today is about the expansion of brand advertising. It is just that kind of visibility that makes consumers think they’re wasting their money to pay for brand products supported by huge advertising expenses.
Make a list of the stores with the highest percentage of private label products in their stores. Then make a list of the highest sales per square foot stores. Then compare the overlap. That should answer the question on where private label is going.
Private label is such an enigma. On the one hand, margins are attractive but on the other, it takes double the marketing push to get product out the door. Consumers still equate private Label with value so, in terms of the economy, expanding house brands is the way to go. As prices rise (raw goods, fuel, etc), brand names have no choice but to go up but with private label, there is (at least there should be) room to keep prices the same. So there is a competitive advantage to the house brand. Conveying the image of high quality and value is where the challenge lies.
It’s all about the label and many lines have done a great job of meeting and even surpassing the name brand in terms of image.
To add to the challenge, now is the time where chains can capture customers and make them regular purchasers of their respective house brand. A great example is Loblaws. They are going through a major marketing push for their organic baby food line. At the end of the commercial, Galen Weston says that there is no price difference from regular baby food. That goes a long way for the consumer especially when the psychology of bad economic times is on the customer’s mind.
The quality of store brands varies widely from store to store. Some stores offer premium store brands, while others offer bargain priced store brands that don’t measure up to national brands. Trader Joe’s seems to be the master of store brands. For almost every category, they offer a store brand. They do it with panache and humor and at good prices.
Recession or not, retailers need to maximize the value of each shopper. One way to do this is through store brands. During recessions, consumers tend to look for ways to save money. The current economic slump should be no different. The quality of a store’s brands will determine whether or not a consumer sticks with them when the economy improves.
Traditional supermarkets have already ramped up the activity behind their store brands over the past several years. Many are into natural and organic products, most have simplified their offerings to Value, National Brand Equivalent and Premium/Super Premium.
Additionally, in many retailers who have focused on Store Brands the share has grown even as the economy was strong and the Branded companies have pushed their products. The margin and penny profit that retailers can build into many of their products make them a very good ROI supplement in their marketing plans.
Will they push even more as gas prices and housing issues squeeze consumers? You bet!
With each economic slow down we do see a slight increase in sales in certain private label categories. However, for the most part, national brands will sustain themselves and it will be a mistake if major mass retailers and grocers go too far with reallocation of shelf real estate. The national brands and niche brands are still the entities that provide the markets pace, leadership, and retail chain revenue. With the exception of specialty markets such as Trader Joe’s, Whole Foods, etc, most stores need to stick with the current balance between national, niche, and store brands.
There is an old saying that if a consumer purchases a Private Label item and it performs to their expectation they will try others. If the second one does as well, they will try others. If the third item disappoints them they will stop buying the first two items.
To rush poor Private Label items into the market is a mistake. All expectations are that this economic slow down will be short lived. Our Private Label Buyer survey indicated one area requiring improvement is the time line from presentation to delivery. It is unlikely a retailer can start today and have new Private Label items on the shelf by the time the economy turns up. Retailers should monitor Private Label sales to make sure they are not Out-Of-Stock due to an increase in sales. Don’t waste the time to speed up new item launches.
Store brands offer value to the consumer, higher profits to the retailer and better supply chain scenarios to the manufacturer.
As a manufacturer, I would prefer to do store branding of our branded products every day! These translate into longer lead times, more stable ordering cycles and lower concerns about packaging, merchandising and promotions (there are none).
Best yet, savvy retailers are demanding that their store brands carry the same panache and offer the same level of quality as their heavily promoted cousins.
Store brands are here to stay, and will continue to grow and establish themselves whenever the economy becomes more demanding.
The food industry is evolving into marketing companies and producing companies. Much of what used to be company owned production has become contract manufacturing. This has afforded retailers with access to the very best production methods and packaging capabilities. When these capabilities–especially packaging–were controlled by marketing/producing corporations and the latest production capabilities were denied to retailers, then the marketing/producing corporations controlled the grocery shelves and market share.
Now, retailers have access to pretty much all the technology available and have developed some pretty spectacular PL products. Retailers have a singular advantage in that they know exactly what is selling in their stores. It is very easy for them to run a fairly accurate P&L on any anticipated PL product and make a great business decision with regard to introducing a PL product.
I believe Harris Teeter has three levels of PL in their stores. An economy brand, a national brand equivalent and a premium product. As the base of PL grows, it will allow for the development of even more PL product. I can tell you this: producers don’t care who cans this year’s crop of green beans, broccoli or corn. If a grower can get more for his crop by selling to a retailer who can afford to pay more to get the very best because his marketing and production expense is 30% less than a national brand then the raw material supply will move to the retailer. They have the power to control every category in their stores except alcohol, HBA and soft drinks. This will become more evident as retailers make the transition from store advertising to product advertising.
It’ll be interesting to watch Whole Foods’ results as consumers tighten their belts in the coming days. Our guess is that they will continue to thrive and that the Whole Foods lesson (Whole Foods as the flagship brand with their stores selling only brands that align with the flagship brand) will continue to prevail.
We really see the “tightening” happening in more frivolous purchases, like consumer electronics, gas guzzling automobiles, higher end restaurants and movie theaters.
You will always have to eat, and eating better is more than a trend.
Best-practice private label as a marketing strategy has moved so far beyond price-driven generics as to make the question almost irrelevant. Look to how Whole Foods, Costco, Safeway, Kroger and others are conceptually handling private label, and this should be obvious.
Private label grocery is similar to private label apparel. In both merchandise categories, some retailers’ goal is 100% private label (J.Crew), some retailers mix private label and famous brands (J.C. Penney), and some use private label only rarely (many local independents). Some private labels feature less-expensive copies (Sears) and some are innovators (H&M).
The Great Grandma of private label store brands is A&P and its long history of quality products.
A&P gave the customer the finest quality food and household products by manufacturing a lot of what they sold under Ann Page, Jane Parker, Sunnyfield, Sunnybrook, Iona, Sultana, Marvel and dozens of other labels.
Customers shopped A&P for many years because their house brands were just that good. The customer knew that Sunnybrook eggs were the highest quality, Grade A large, that Wildmere were grade medium size eggs and that Crestview were small eggs.
Such selection, such quality, such value. So while shopping the typical Aldi one can find inventive names such as Happy Farms butter and Tundra Liquid Bleach, the playbook had already been invented by A&P.
In these inflationary times, those retailers who can offer great quality private brand lines and great savings, stand a much better chance of earning customer loyalty with exclusive house brands.
The emphasis is on “quality” and “value.” No-name generics will not work in this kind of market. The consumer’s palate has become more discriminating over the last decade and only the best quality products at major savings will do.
ALDI and Costco are the two florishing ends of the spectrum here…Costco’s Kirkland/Kirkland’s Best PL is by far the best PL I have experienced. Given its superior quality and value for money, I would actually be open to paying more for it than for a brand.
For the others, PLs are simply a cheaper option and best fit into categories where there is no element of choice or taste.
Growing proprietary brands for differentiation is a good strategy in any business cycle.
Pushing “cheap stuff” under a store brand would be to repeat the strategic debacle that torpedoed private label in the U.S. in the seventies. Selling cheap food and selling proprietary brands are two completely different things. It took our U.S. industry thirty years to figure that out the first time. Let’s not regress.
The growth of Private Label products is expanding–that is true. But as consumers start to take on more and more of these PL items, how will the grocers make up for the loss of promotional dollars that line their coffers right now? It’s a double edged sword.
Is a new era emerging where the quality levels of private label products and national brands have become indistinguishable?
Retailers are more savvy today about the necessary quality levels needed to sustain private label sales growth both at lower and higher price levels. Successful new retail entries such as Trader Joe’s and Whole Foods now feature premium level private label products and have conditioned the environment for even greater of acceptance of private label. While the slowing economy favors lower priced products there is still a heavy demand for premium products particularly when favorable priced.
Both would seem to be opportunity areas.
People will buy what they find likable, pay what they think a likable product is worth, and many retailers have now become astute marketers. That trend places a burden on national brands to come up with new innovative offerings to try to catch consumers’ fancy in sectors where private labels do not exist. If national brands don’t or can’t, is a new marketing game forthcoming–or are retailers just trying to stay in the game by having their private labels dominate their shelves?
Not all Private Labels are equal…. The Trader Joe’s strategy is quite unique, permitting TJ to offer a full array of grocery items in a small, compact and simple to shop store format. Price-Value is exceptional and usually wins in any head-to-head comparisons. Once a product has the TJ label, it makes returns simple, no need for a receipt, a feature many of us prize–making them similar to other service leaders like REI and Costco.
The TJ Private Label approach cannot be imitated by most full-service grocers, at least not fully–cereal aisle will likely remain ‘a mile long’ with a confusing array of varying sizes and endless variations on the original cereal theme. And so on for the other aisles.
The one player that could take advantage of the TJ strategy is Whole Foods. This would insulate them from more direct comparison shopping and make Whole Foods even more special and the ONLY SOURCE for their labels, differentiating them from traditional grocers and permitting more pricing flexibility to keep the Value Consumer shopping, even in downturns.
The focus of this article is on saving money during difficult economic times via store brands. Yet the emphasis I see from stores themselves is not on potential family cost savings from purchase of basic private label goods, but a push for their more pricey “premium” PL products.
The local Safeway (still called Dominick’s) has recently beefed up (no pun intended) Saturday morning sample “tastings” of some of its premium prepared entrees and PL products accompanied by store coupons or limited time discounts.
Gaining customer confidence that the product is tasty and worth the money seems key to getting it into their carts for the first time. I would be interested in how much such freebies and coupons eat into the profitability of these products, but it seems necessary for developing a market for them in my area. But, why do stores in general not do more to advertise the cost benefits and uses of their basic PL offerings?
I think retailers will move to a tiered store brand approach. Each tier will have a role within assortment, pricing, promotion, and overall consumer value proposition.
Strong grocers will take a “manufacturer’s approach” when managing their store brands.
There seems to be a big theme in the comments so far–one is that PL with quality is a good idea, PL with mediocre quality is a bad idea. Grocery cost-cutting is not usually seen in an economic downturn–but you may see less expensive cuts of meat, less expensive wine, and so forth. Retailers should not expect a rush to private label, but a rich opportunity exists at any point in time to offer a quality product at a good price.