Own production line vs Private label: things to consider

Posted Aug 12, 2020, Category: Business

There are many debates, trying to answer the question of what is more preferable: to own the production live, or to outsource it to private label manufacturers. From Eurodita’s perspective, we believe that both have some merit. For those looking for more control over the end product, we would say the best option is to build their own production. Yet for those that want to focus on developing a brand the choice would obviously be to outsource the production line.

Because both of these options have merit, we would like to present our point of view and why the choice must be made with great care and consideration.

Owning the production line

First thing to consider is the investment cost. We can speak from the perspective of producing glulam log cabins and their individual parts, but the setup is not cheap. Whatever the product, the production line will need investment into different machinery. For us, it’s not just the cutting, but also drying the laminated planks, storing the finished items, packaging them correctly. The entire process must be controlled and different stages must be managed by different specialists. Owning your own production is a challenge that is difficult to control, more so with quality checks at the end of every production.

With all that, there’s also the question of sourcing material. For the wast majority of our log cabins and houses, the primary timber we use is the Northern pine. It’s sturdy, light in colour and overall extremely reliable, becoming even more durable during the lamination process.

Taking all these aspects into account, starting up your own production line can be tricky and expensive. More so without specific knowledge of the best production practices, because hiring specialists can also call for a steep price, especially at the beginning. This is why a lot of companies are deterred from having their own production line and why many companies on the market tend to consolidate – that is a good solution to offset these production costs and to invest into efficiency, further bringing down the cost.

The private label option

At the beginning of our business, we at Eurodita knew that we were good at production. We were familiar with the timber we wanted, with the building necessities of the log cabins and log houses, and with quality assurance process. Where we were not so knowledgable was the branding and direct to consumer sales tactics.

That is why we became a private label homes manufacturer, in order to focus on our strengths rather than try and get over our weaknesses. Same way some companies instead focus on painstakingly developing their brand of quality log cabins and focus on B2C sales of bespoke log homes and contemporary log cabins. They pay attention to the customer, hear their every need and only then come back to us to focus on the engineering and blueprints of how to make their customer’s dream come true.

Starting your own log cabin sales business requires much less financial investment, but it takes no less personal effort. Building reputation is hard and doing it while facing the end customer is even harder, since every misstep can cause the brand image to collapse. If you’re good at building a brand, it’s much wiser to choose a reliable production partner and source all your log cabins or other products from them, rather than investing into building your own production line, which could also take years.

We know how much time and effort our partners put into working with their clients. This we know because also put our pain focus on our partners and their success. Our partner program is very generous in terms of growth and offers our partners the chance to earn seizable profits while working with our extensive catalogue. We are always open to expand our partner network, no matter where they are in the world.