Licensing and Private Label: The Same Supply Chain, Two Different Ways of Making Fashion
The same design team may work with the same pattern cutters, suppliers and sampling calendar. On one project, it has to carry a recognised identity into a new category. On another, it has to build an offer around the customer, the price and the space available in store.
Licensing and private label share much of the same supply chain. What changes is the starting point and the responsibility assigned to creativity.
When the brand comes before the product
In licensing, the owner of a brand, the licensor, grants another company, the licensee, the right to use it. The agreement defines the product category, territory, duration, distribution channels and commercial terms. Royalties and minimum guarantees are common, although each agreement has its own structure.
The licensee contributes expertise that the brand either does not have in-house or chooses not to manage directly. It may handle the design, development, manufacturing, distribution and marketing of the licensed category.
Prada, Prada Linea Rossa and Miu Miu, for example, entrust EssilorLuxottica with the development, production and worldwide distribution of their eyewear collections. The product comes from combining the codes of the three brands with the specialist group’s technical and distribution expertise. EssilorLuxottica
The creative responsibility lies in understanding which parts of the identity can move into a new category. A pair of glasses cannot reproduce a dress, just as a fragrance cannot translate a collection literally. Yet both should address the same customer and support a consistent idea of quality, proportion, detail and price.
Approvals run throughout the development process. Concepts, drawings, materials, colours, prototypes, packaging and communication pass between licensee and licensor, often several times. This control protects the brand, but it cannot replace product expertise. A frame may use the right colour and still have a weight or hinge that feels unconvincing for its market position.
When the licensee copies the codes too literally, the result becomes a caricature. Move too far away and the product feels unrelated, with a familiar name added at the end. Much of the work happens between those two extremes.
When the retailer already knows the price, customer and channel
A private label is a line sold under a retailer’s own brand or under a name created exclusively for that retailer. It may be developed internally, with external suppliers handling production, or created in partnership with companies that also contribute research, design, pattern cutting and industrialisation.
Zalando develops six private labels in-house: Anna Field, Even&Odd, Friboo, Pier One, Yourturn and ZIGN. Each one serves a different segment, from childrenswear to streetwear, while production is entrusted to a network of suppliers. Zalando
This example also clears up a common misunderstanding. A private label does not always begin with a weak identity. Some have established codes, a recognisable customer and a product language built season after season. The distinction lies in brand ownership and in the direct relationship with the retail channel.
The brief often starts with a specific gap in the assortment. The retailer may need a dress at a particular price point, a younger offer, a category with stronger margins or a product responding to patterns found in sales and returns.
Creativity therefore works with very concrete information: retail price, target cost, volumes, delivery dates, required fit and the product’s position alongside the other lines sold in the same store. There is creative freedom, but a cost sheet soon lands on the table.
Licensing | Private label | |
Starting point | An established identity | Customer, market, price and channel |
Creative question | How can the brand enter a new category? | What product is missing from the retailer’s offer? |
Freedom | Constrained by brand codes and licensor approvals | Broader, but restricted by cost, margin, volume and timing |
Primary responsibility | Interpret without distorting | Build an offer that is distinctive and commercially viable |
Creative risk | Dilute the brand or turn its codes into a caricature | Create a generic collection that looks too much like its competitors |
Control | Shared between licensor and licensee | Mainly held by the retailer |
Visible author | The licensed brand | The retailer’s brand |
Core expertise | Translating the brand into a new category | Building the assortment |
From brief to delivery
As soon as development begins, the two models return to a shared supply chain.
The market and previous collections are reviewed. The range plan takes shape, categories and price points are defined, and fabrics and trims are sourced. Then come sketches, prototypes, fittings, corrections and final samples, followed by orders, production, quality control and delivery.
In licensing, each stage has to remain connected to the brand’s codes. Even a small technical decision can alter the outcome: the thickness of an acetate frame, the weight of a trim, the finish of a leather or the frequency with which the logo appears across the collection.
In private label, the same stage is assessed in relation to the customer and the assortment. It is not enough for a garment to look good and meet its target cost. It needs a role. When it resembles too many products already in store, it takes up space without adding a reason to buy.
At the fitting, the differences become less theoretical. For a licensed product, the team assesses whether it retains the promised identity and whether the category supports it technically. In private label, fit, price and the garment’s function within the collection carry more weight. In both cases, a cost reduction can change the drape, handfeel or perceived quality. The spreadsheet records the saving. The body shows the rest.
Distribution also changes the product, not only where it is sold. A licensed category placed in unsuitable channels or repeatedly discounted can affect how customers perceive the main brand. Private label begins within a defined channel and benefits from the retailer’s knowledge of its customers.
Sales, returns and repeat orders provide fast feedback, but someone still has to interpret it. A high return rate on a pair of trousers signals a problem. The data alone cannot explain whether it comes from the fit, fabric, length or an image that promised a different silhouette.
Licensing and private label often sit at the edges of the way fashion is discussed. Licensing gets placed next to marketing and contracts; private label is mainly associated with buying and production. In daily practice, both involve creative direction, merchandising, pattern cutting, sourcing, pricing, quality and distribution.
Eventually, both arrive at the same table: a sample, a cost sheet and a delivery date. In licensing, the question is how much of the brand remains in the product. In private label, it is whether the product gives the customer a clear reason to choose it.
At that point, the contract is no longer visible. The product is.
Romina Tosi
Disclaimer
The views expressed above represent my personal interpretation of publicly available information and, like any interpretation, may be shared, debated, or challenged.
The information referenced comes from public sources available at the time of publication, including official documents, union communications, press articles, and materials accessible to anyone. I do not disclose confidential information or facts learned through privileged access. I do not reveal protected information, nor do I attribute unlawful conduct to individuals or companies.
Any reference to specific cases is intended solely to provide context and analyze dynamics affecting the broader industry. It is not intended to target individuals or particular businesses.
Observations regarding industrial strategies, financial decisions, and production models fall within the right to express opinions and commentary on matters of public interest. They remain personal assessments, not definitive judgments.
Not all companies operate in the same way. Alongside businesses that may deserve criticism, there are many others that work with seriousness, consistency, and long-term vision.
If you notice any errors or inaccuracies, please let me know. I will be happy to review and correct them where necessary.
The purpose of this reflection is to encourage discussion and debate, not to cause harm to individuals, companies, or organizations.
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