India's Retail Sector Witnesses Rising Demand for Private Labels

Indian consumers are increasingly opting for private labels and in-house brands over established brands, and retailers are taking note. According to EY's Future Consumer Index 2025, more than half of India's consumers are now choosing in-house brands over legacy labels.

The report highlights that 52 per cent of Indian consumers have switched to private labels for better value, while 70 per cent believe these in-house brands offer comparable or superior quality. Backed by this shift, retailers from BigBasket to DMart, and quick-commerce players like Zepto and Blinkit, are doubling down on their private label strategies, viewing them as a path to higher margins, stronger brand loyalty, and greater pricing control.

"Indian consumers' growing preference for private labels reflects both short-term price pressures and a longer-term structural evolution in retail," said Devangshu Dutta, CEO of business management consulting firm Third Eyesight, speaking to Entrepreneur India.

Trending Globally

The surge isn't unique to India. A recent report by the Institute of Grocery Distribution (IGD) notes that globally, private labels now account for over 45 per cent of grocery volume and are expanding faster than legacy brands.

In India, this shift is becoming increasingly visible in-store. The EY report found that 74 per cent of consumers have noticed more private label options where they shop, and 70 per cent say these products are now displayed more prominently, often placed at eye level, signalling a strategic retail push.

Neha Singh, Co-Founder of global startup data platform Tracxn, expressed that, "Consumers are increasingly opting for in-house brands, driven by a mix of economic advantages, enhanced quality, and convenience."

She noted that heightened price sensitivity, particularly in an inflationary environment, has made private-label products an attractive option for households seeking better value.

In the EY report, Angshuman Bhattacharya, Partner and National Leader, Consumer Products and Retail Sector, EY-Parthenon, said, "Consumer behaviour has traditionally evolved in response to changing economic situations, but the current shifts appear to be more permanent. Retailers are confidently launching private labels and allocating prime shelf space to them, while technology is enhancing the shopping experience by providing consumers with limitless options and the ability to compare products."

From price-fighters to power brands

According to Dutta, private labels are no longer just "copycat" alternatives meant to undercut national brands.

"For retailers, not just in India but globally, lookalike private labels used to be tools at the opening price point to hook the customer, who saw them as credible, affordable alternatives to national brands," he explained, adding, "However, as retailers have grown, they have gained both scale and expertise to widen and deepen their supply chains."

Over time, he said, investments in formulation, packaging, and quality consistency have increased consumer trust. "Private labels now compete on functional benefits rather than only on price, particularly in food staples and apparel, but also in brown goods and white goods, and increasingly in personal care and other FMCG categories," he added.

Retailers scale up private labels

As the demand for in-house brands grows, retailers are scaling up their strategy across sectors.
BigBasket, one of India's largest online grocery platforms, reported that 35-40 per cent of its FY24 sales came from private labels like Fresho, BB Royal, and Tasties. The company aims to push this share closer to 45 per cent through expansion in frozen foods and ready-to-eat categories.

DMart's private label arm, Align Retail, has reportedly more than doubled its sales in two years, touching INR 3,322 crore in FY25. The retailer's in-house brands in staples, apparel, and home essentials have helped boost margins in a highly competitive retail landscape.

Zepto, the quick-commerce player, is taking private labels into the 10-minute delivery domain. Its brand Relish, focused on meats and eggs, has achieved INR 40 crore in monthly sales.

Meanwhile, Reliance Retail has also expanded its portfolio of private labels, including Good Life, Enzo, and Puric, across groceries, personal care, and household products, strengthening its broader FMCG play. In 2024, Reliance Retail's Tira Beauty also announced the launch of its latest private label brand, 'Nails Our Way', signifying a major expansion in its beauty offerings.

Retailers respond to shifting consumer behaviour

Retailers are actively capitalising on this growing preference by increasing visibility and accessibility of in-house products.

Singh explained that, "Retailers are supporting this trend by expanding the availability of store-brand selections, strategically positioning them for greater visibility, offering curated and consistent product ranges, and positioning them as value-driven choices."

From a business standpoint, she added, private labels give retailers greater control over pricing, supply chains, and product development, allowing them to respond more rapidly to emerging consumer trends.

Capturing a lion's share in retail

Devangshu Dutta noted that in India, private labels will remain a core pillar of modern retail strategy rather than a cyclical response to cost pressures.

"Consumers increasingly view retailers as brand owners rather than intermediaries. As private labels mature in branding and innovation, their growth aligns more and more with brand equity development rather than just opportunistic cost-saving," he said.

From a retailer's perspective, private labels deliver higher gross margins and greater strategic control, Dutta added.

Another report by the Private Label Manufacturers Association (PLMA), using Circana data, found that in 2024, private-label sales in food and non-edible categories grew faster than bigger brands globally. While figures vary by region and quarter, the pattern remains consistent: private labels are outpacing traditional FMCG growth.