What is White Labeling?
White labeling is a business model that takes existing software or services and branding it as your own. That sounds illegal (it can be), but it's not if you're doing it legitimately. There are software companies and service providers that create products so that resellers can brand it and resell it as their own. This allows white labeling providers to focus on servicing several businesses that do large order volumes or buy high ticket products rather than hundreds to millions of individual customers.
This allows small businesses the ability to create a company to service many niche customers purely from white-labeled software and services, even creating a full suite of offerings, without producing a single line of code or hiring an employee to provide services.
Business Add Ons
The categories of white-labeled products and services are plentiful and so are the providers. This means there are many viable businesses that can be created or products to add-on in many different market categories.
For example, If you owned an accounting and bookkeeping business, you could add bookkeeping software that you could resell to your customers as a cheaper alternative than full service. Or, if you don't have bookkeeping services, you can add a white-labeled bookkeeping service to your repertoire.
This provides alternative solutions for your customers and keeps costs at bay for you. It's a great way to capture a wider audience and increase your streams of revenue, without dedicating an exorbitant amount of resources to do so. It also increases your brand value. The more sophisticated your offerings are and the more varied your services become to meet your customer needs, you become that much more valuable to them.
Business in a Box
If you don't have an existing business, you could quickly create one from many of the software and services available in the white-labeling space. That means you could be a digital marketing agency that provides SEO, social media management, and content creation services without actually doing the day-to-day services. You could create a web development agency that outsources all your web development. You can be a sales and lead generation company that provides leads to local businesses. The possibilities are wide.
Below are examples of White Labeling Software & Services:
- Marketing Software
- Sales Software
- Lead Generation Software
- Finance Software
- Logistics Software
- Data Management
- Customer Service
- Accounting Software
- Advertising Strategy
- Website Development
- App Development
- Social Media Management
- Review management
White Labeling and Private Labeling
You might have heard the term "private labeling" used synonymously with white labeling. They are closely related, but the key difference is that the term private labeling is used for physical products that are rebranded from manufacturers, while white labeling is reserved for software and service products. However, there will be people that use the terms interchangeably. The core concept is taking an existing product/service and branding it as your own.
How Does it Work?
How Do You Make Money?
Most white-labeled software products and services are charged on a monthly or annual basis to you, the reseller. Many white-label providers will have pricing options based on the amount of business you'll be doing.
As a reseller, you can price your software products at your discretion. Many times, you'll be able to sell your rebranded white labeled products for a monthly subscription fee and your service will depend on the job cost you're taking on. It's advisable to compare the pricing landscape with competitors so that you're able to best attract customers.
What Are The Pros & Cons?
- Quick to market
- Little upfront cost compared to building your own software
- No overhead costs with adding services
- Able to quickly add additional products and services
- Able to increase revenue channels without much cost
- Little to no control over the customer experience
- Margins are smaller
- Little control over the actual product
Estimated Startup Cost
The startup cost for creating a white label business can vary greatly. It depends on the products or services you're offering, what kind of products and services, and other factors. You'll also incur startup costs on getting the word out about your business. Are you creating an agency or are you a blogger that's planning to sell software that matches your niche focus.
Monthly costs on software and services can be as little as a few dollars to thousands of dollars a month on software. Also, how are you marketing your business.
Key Activities White Labeling
When you start a white-labeling business, the first thing you'll spend time on is deciding what your business focus is going to be and then finding the necessary products and services that fit your business niche. However, once you've established the basics, most of your time is spent marketing your services, selling clients, and maintaining customer relationships.
Start White Labeling
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