h advance orders and better forecasting, Downtown L&G can reduce costs for themselves as well as the retailers. However, retailers are often reluctant to turn this over). ?Do the Private Label and Premium Brand products share the same cost structure/manufacturing processes? No. The Private Label is sourced to a third party who is able to produce the products at a much lower costs than Downtown L&G. This affects costs for the Premium brand product because Downtown L&G frees up more excess capacity and is unable to utilize supply chain efficiencies and scale economies. ?Are margins the same across both product segments? No. The Private Label products earn a lower margin than the premium products because Downtown L&G has to give their clients, the retailers, a greater portion of the margin. 9
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