How to Save Money on Groceries: Store Brands

by JadeDragon

The big 12 food & packaged goods companies spend massive amounts of money to build brand loyalty, but let me let you in on a secret.  Store brand and no name brand is exactly the same product, usually at a good discount off name brand.

I’m a food industry insider in some ways, so let me give you a peek inside the businesses that stock your local grocery stores.

There are only about 12 big food/packaged goods companies operating in North America.  In no particular order the big multi-brand, multi-line food companies are Pepsico, Kelloggs, Mars, Coco-Cola, P&G, Nestle, General Mills, Johnson & Johnson, Unilever, Kraft, Con Agra, and in the natural food space, Hain Celestial.

Nearly all the big food companies make store brand and no name products in the same factories with the same ingredients as their name brand products. Some more complicated products may have a slightly different formulation, or different names listed for the same ingredients, but generally store brand products are essentially identical to name brand products.  If you look at the name brand and store brand packages they are often the same size and shape with the same caps etc. The plant just changes the package color and label as needed, but the ingredients, equipment, and process are exactly the same.

In addition to the big name companies, there are little known (to the public) companies that specialize in “co-pack”, which is the food industry term for packing product to the retailer’s specification.  Retailers what a good store brand alternative to the branded product, and therefore these co-pack companies must meet the retailer’s standards or loose the co-pack contracts.

Real Examples:

My family business manufactured grain products that went in to big bins. As the company filled orders, it filled company branded or store branded bags as required.

I bought a Pillsbury/Green Giant factory that was just closing, where they canned veggies for many years. From the staff I learned that during production all the cans went in the warehouse without labels and all the frozen veggies went to the freezer in big bulk totes harvest season.  When corn or peas or carrots were ordered they pulled a pallet of corn cans and added Green Giant or a store brand label to match the order. Frozen vegetables were similarly packed into bags as required. I’ve visited several other frozen food factories, different owners, that do the same thing.

I’ve toured a factory that fills soap, shampoo, body wash etc bottles. The product is all the same basically, just different scents and coloring and different bottles to make the product look different.

I’ve handled product for an ice cream plant that makes both branded and store brand products.  Same equipment and processes exactly, although there are different qualities of ice cream based on fat content, amount of air introduced to the product etc. Ice cream is one of the rare products where there is a difference in “richness” but still, store brands are often very good quality.

I know a lot about a big brand name water facility. They fill the name brand and store brand bottles on the same line with exactly the same filtration process. The only difference is the label and price point.

I could go on with more examples from cookies to juices to pasta dishes, but you get the idea.

Moral of the story:  Paying more for a brand name product vs the store brand product next to it is just throwing money away pointlessly. Unless a coupon and sale combination will reduce the price of the brand name well below the store brand, stop wasting money on big name grocery and personal care products right now.  Yes, you can reduce your grocery bills substantially by reaching for the right product.