Is it just a matter of increasing the profit margin?

A MATTER OF CONTROL?
sumac - I've not read the article. However, I'd make a guess that besides increasing profit margin, control of the product would be a factor. Quality, quantity, availability, shipping, on-time delivery. Probably more. Not my part of the business world.

Might be something about competition, too. "You can sell it, but I can't unless I buy it from you."

Hope one of the "business-types" posts here. They should have a handle on this.

From my end of the world, I see that the retailers are hurting badly. I have never seen so many sales in all my life just before the holidays. The article is right on target when it says that you can pick up a Liz Claibourne or its ilk anywhere. Private branding does make a product unique in the market, in addition to the other factors noted by Charli.

I think that people are looking for bargains now, when they go to the department stores. Off brand and discount stores have taken away much of the market dominated by the departement stores of the past. House brands are one way to stimulate purchasing, and also enhancing the store's bottom line!