👉 Background: Universal Store is the Aussie youth apparel retailer founded in 1999. It competes with the likes of General Pants, The Iconic and Glue Store and has grown to over 100 stores.  

👉 What happened: Universal’s total sales jumped 15.5% to $333 million for the last financial year (at a time when most retail market players are crying poor). Universal's profit wasn’t left behind either, up 15% to $34.8 million. The icing on the cake? A tidy dividend for investors.  

👉 What else: The key driver of this growth was its private label brands like Perfect Stranger, which grew 83% from last year as well as Neovision. While these brands are stocked in Universal Store, they also have their own standalone stores too. Now, Universal wants to keep growing its private label store footprint for even better margins.

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‍What's the key learning?

‍💡Retailers are no longer just selling brands, they’re incubating them and then sending them off to become standalone stars.

💡With this model, the retailer starts stocking private-label brands in-store. These brands get the benefit of a built-in distribution model, extensive data and an instant customer base. And then, if successful, the retailer can spin the winning brands into their own shops. Universal Store did this with Perfect Stranger, which now has 19 outlets of its own.

💡Kmart pulled the same trick with Anko, which is not only stocked in Kmart and Target, but also has standalone stores in the Philippines. Kmart also sells the Anko brand into Walmart Canada and has been valued at more than $8 billion alone, according to Jarden analysts. So while the private label model has become popular, it looks like the generation is the private-label evolving into a standalone label.