Why private labels are increasingly popular in Spanish supermarkets

by Lorraine Williamson
private labels

Every year, private labels gains more and more weight in the consumer’s shopping basket. In fact, two of the largest consulting firms (Kantar and Nielsen) estimate its weight at 43% and more than 46% respectively. This means that the manufacturer’s brand is gradually losing importance. Especially since some chains prefer their own brands to those of the manufacturer.

Specifically, the private label range in the distribution chains has grown by 13% in recent years at the expense of the manufacturers’ brands. The latter are down 23%, according to Kantar. The large chains, which monopolise a large part of the market, play an important role in this.

Supermarket shelves

For example, in the last six years, Mercadona has reduced the number of products from manufacturer brands on the shelves by 45%. Dia by 42% and Eroski by 31%, according to Kantar’s report.

In 2018, Mercadona had 2,816 brands on its shelves, while in 2023 there were only 1,539. In Dia’s case, it went from 3,019 to 1,789. And at Eroski from 3,134 to 2,166 brands. The combined share of the three chains in Spain is 34.2%.

But they are not the only companies where this phenomenon occurs. At Alcampo, the decrease fell by 23% (from 3,422 to 2,626) and at Carrefour by 20% (from 7,399 to 5,904). In sixth place is Lidl with a decrease of 14% (from 1,272 to 1,089).

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Why do consumers choose private labels?

There are two main reasons why consumers turn to private labels. The first is that consumer habits have changed and that consumers need to save money in their shopping baskets. And the private label has traditionally been the cheapest brand, although its price is currently increasing more than that of the manufacturer. And the other is precisely the lack of manufacturer brands on store shelves.

Margin on manufacturer brands

Distribution chains in the FMCG sector apply higher margins to manufacturer brands compared to private labels. In doing so, they encourage the end consumer to buy the private label. On some products, the margin applied is even 2 to 18 times higher. This distorts the market and gives distributors more bargaining power. And apart from the fact that more and more brands are disappearing, this also makes manufacturers less inclined to innovate.


Innovation in FMCG products in Spain is still in free fall. Between 2010 and 2022, it fell by 45%. Mercadona scored the worst in 2022, with 4% of products. Lidl was at 5% in 2022, compared to 18% the year before. Aldi with 11% and Dia with 16%. Gadisa also fell from 19% to 17%.

On the other hand, Carrefour (61%), Alcampo (40%) and El Corte Inglés (40%) were the three chains with the most new products on their shelves in 2022. Grupo Eroski rose 5% according to the latest ‘Innovation Radar 2022’

Also read: 2024 year of offers in Spanish supermarkets

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