More US shoppers fancy the plain packaging of generics in the stores
Chicago — Americans are checking out some $100 billion annually in private-label and generic merchandise when they shop at the supermarket, drugstore, and general merchandise store. And the business is continuing to grow. Evidence of this could be seen here recently at a convention of the Private Label Manufacturers Association.
More than 225 companies exhibited products ranging from T-shirts to detergents, frozen vegetables to razor blades, and light bulbs to beauty aids. Some 1,500 buyers came to see what was new in merchandise they could use as their own house brands or the generic items they carry on their shelves.
Until a few years ago, says E. W. Williams, publisher of Private Label Magazine, house brands were treated as a ''stepchild industry.'' But inflation, particularly in the late 1970s, changed all that, he says.
House brands aren't new. A&P has had the Ann Page label for many years, and Sears, Roebuck & Co.'s Kenmore label has become a familiar brand name of its own. Many independent grocery chains have their own merchandise, often made by the same companies that produce the leading brands.
''House brands are in demand because they represent quality products at 10 to 30 percent savings,'' Mr. Williams explained. ''Chains carry them because they give a store identity and better profit.''
Prof. David T. Hawkins of the Harvard Business School told the conventin that private labels and generics will continue to be offered because of hard economic times;, ''because of the new consumer who knows that national brands are not the answer''; and because of the retailer who's looking to make better profit.
But what will happen when the recession ends? Mr. Williams is convinced that private labels and generics are here to stay. ''First, people will always want to save money no matter what the economic climate, and more important, they are becoming used to buying private labels, or at least comparing them - they've become accustomed to their face.''
His magazine projects a growth of from 25 to 30 percent in combined private-label and generic sales between now and 1987.
He reported that generics account for only 0.8 percent of the $240 billion in total supermarket sales, but that's up from 0.4 percent in 1980.
In the dry foods category, Williams said national brands recorded sales of $ 48.9 billion in the year ended June 25, while private labels contributed $7.76 billion and generics generated $1 billion of sales. Of nonfood items sold in supermarkets, $16.7 billion worth were brand names and $2.4 billion were private label, while $621 million in generic items was sold.
He explains that private labels aren't marketed to hurt the sales of the national and advertised labels. ''They are a brand themselves and offer the consumer freedom of choice.'' Most supermarket chains carry three brands: the national label, the store brand, and a generic, with a regional label included in many cases.
Williams is often asked if generic brands are inferior. His answer: ''Sometimes. But in most cases the taste and quality differences are slight. They often are of the same quality as the private or advertised labels depending on the product, and they certainly are cheaper.''
''Now there seems to be some flexibility in the packaging of generic products which hitherto had been restricted to a plain white label with merely the name of the product on the outside. More recently,'' he continued, ''colored and somewhat more attractive labels are used, often bearing the store name.''
Suzanne Shafner, vice-president of the Berni Corporation, Greenwich, Conn., a market research firm, told the convention that the days are coming when private labels will be advertised the same way national brands are.
Miss Shafner added that some generics are being offered with colored labels and are selling better because consumers are drawn to them on store shelves. Even the use of green printing rather than the generic black label is increasing sales, she said.
Professor Hawkins and Mr. Williams explained that private labels offer large retailers a good profit margin and help to build store loyalty. Research shows that younger people and those in higher economic brackets are buying private labels.
Private labels and generic items are also selling well in Canada and Western Europe, and his magazine is expanding its coverage of these sales overseas, Williams said.
With Stalin gone, better educated and generally more articulate policy ''specialists'' gradually came to figure in the policymaking process.
It was amid this shift that Yuri Andropov - ambassador to Hungary when Soviet tanks rolled in in 1956 - got his first job near the center of party power. He was called to Moscow in 1957, in his early 40s, as a specialist for the Central Committee's inner Secretariat on relations with Eastern Europe and other communist states.
Hungarian sources hold that, whatever Mr. Andropov's role in the Soviet invasion of their country, he later lobbied for tolerance of specifically Hungarian approaches to rebuilding popular credibility for a communist regime.
Perhaps. What is certain is that Mr. Andropov, once back in Moscow, came to work closely with the less dogmatic and younger policy specialists attached to the Secretariat.
Strictly speaking, he was not one of them, being much more the political and party figure than they. Yet the ties - professional and personal - are said by senior Soviet sources to have been close and to have survived even Mr. Andropov's tenure as KGB (security police) chief from 1967 through early this year.
Their ideas, for present purposes, are more important than their identities. In interviews with The Christian Science Monitor over recent months, they argued strongly, on the foreign policy front, for a revival of superpower detente to the extent possible.
To the extent the Kremlin might want to act more toughly toward the Americans , the priority, as a senior official put it, would be to act ''realistically,'' in the knowledge that at least some exercises in muscle-flexing internationally could ''end up threatening oneself more than others.''
Domestically, the tack suggested seemed a measure of ''reform,'' but again, a prudent one. Economic change, as an official put it, is not only an economic but also a political issue. He personally rejected the idea of wholesale ''decentralization'' of authority. He envisaged, instead, continued ''centralization'' of key policy decisions - including the setting of prices - but with ''maximum autonomy for local initiative in implementing them.''
Not explicitly referring to any ''post-Brezhnev'' period, the official, speaking this summer, did cite a ''tendency to end price subsidies'' and bring retail prices more closely into line with supply and demand. ''I think there will be considerable changes. And although there is, of course, political concern on the issue, the tendency is to look for a better economic mechanism.''
The input of such ''brain trusters,'' as developed in the Brezhnev years, would focus less on day-to-day decisions than on longer-term policy issues. Still, their expressed views may offer at least some hint of the advice Mr. Andropov will be getting.
It was during his stint as communist affairs specialist in the Secretariat during the late 1950s and '60s that Mr. Andropov began studying English. Three times a week, for 90 minutes each session, the bespectacled Andropov would sit with his language tutor.
Whether he became at all fluent in English is unclear, as is whether he continued his lessons when he became KGB director. But he did from this time begin reading at least the occasional English novel, according to friends. (He is also said to have tried his hand at writing verse - in Russian, as it happens , and of a comic variety.)
On a more serious note, Mr. Andropov devoured works of political theory, Soviet and foreign. To suggest this gave him a fondness for Western democracy would be absurd - and not much of a job recommendation for a future KGB chief. The suggestion for some months from various Soviet officials, including those who seem to have been on closer terms with other Kremlin leaders than with Mr. Andropov, is this: that he does possess a particularly agile and inquisitive mind, one that is inclined to adapt communist and other dogmas to the real, and changing, world.
In the realm of guesstimation - or, to be fairer, reasonable speculation - various foreign diplomats add that, whatever Mr. Andropov's policy preferences turn out to be, his 15-year stay at the top of the KGB surely must make him one of the better-informed world leaders on the strengths and weaknesses of his own country and of others.
Vice-President Bush, a former director of the CIA, is said to have opened his meeting with the new Soviet leader by quipping that it was nice to see that two former intelligence chiefs were now high up in superpower politics. Mr. Andropov smiled.