In economics, a white label strategy is widely used in the production of electronics, food and software. The term “white label” came from the music industry, when record companies in the US began to release vinyl records with a white (clean) label, so that sellers could put their own brand on them.
In a general sense, this is one type of partnership, defined as follows:
White label is a model of cooperation where one company produces a product and another sells it under its own brand.
In this article, we will consider the features of working on such a model in the field of software development. We will also explain what the advantages of this strategy for business are.
Key Insights:
- Businesses use white label services to provide comprehensive solutions, eliminating the need for clients to work with multiple contractors for different services.
- Ready infrastructure enables businesses to scale quickly without investing significant time and money in developing their own capabilities.
- The quick start capability enables businesses to launch new services two to five times faster than developing and testing proprietary solutions.
- Client retention improves because customers receive all services from one provider, which reduces the likelihood that they will switch to competitors.
- Businesses can also generate additional profit by reselling products at higher prices, especially when outsourcing to lower-cost regions while serving Western markets.
- Focus preservation allows each party to concentrate on its core competencies rather than spreading its resources across unfamiliar areas.
- This mutually beneficial model allows development teams to focus on quality code while partner companies handle sales and branding.
Examples of implementation in practice
The main reason for the growing popularity of white label services is that there is always a demand for universal solutions on the market. For example, when an entrepreneur decides to promote his business on the Internet, he wants to obtain a combination of the following components:
- development of a company website
- creation of a mobile application
- Internet marketing services.
A digital marketing agency may deal only in those areas that are associated with advertising and creating websites. However, it is always more convenient for a client to interact with one contractor rather than several.
Therefore, in order to offer a comprehensive solution for mobile application development, the agency may use the services of third party developers on the white-label model.
The cost of a basic white-label app can range from $10,000 to $50,000, whereas a feature-rich software as a service (SaaS) platform may exceed $100,000. — 2am.tech
Here are some more examples of IT implementation of such a scheme:
- An IT company from the US that specializes in native development of mobile iOS-applications uses outsourcing to work on a project for Android.
- A design agency is experimenting with expanding its range of services, and launches new proposals for clients while attracting contractors with a white label strategy for their implementation.
- A startup that provides a platform for the implementation of loyalty programs (promotions, referral program, bonus system) offers online store owners the ability to connect to a ready system with full branding for their online customers.
In IT, such a scheme of cooperation is considered to be one of the formats of outsourcing. It provides businesses with a number of important advantages, the details of which we will discuss later in the article.
Why White Label is profitable in software development
A very long list of advantages can be cited, but let’s list the most relevant for small and medium-sized businesses.
- Ready infrastructure. Organizing infrastructure takes time and a lot of money. When you already have an infrastructure, it can be quickly scaled without losing focus.
- Quick start. You can start to provide a new service or product in a short amount of time. This can become an important competitive advantage, because developing and testing a new product using White Label is two to five times faster than developing and testing your own solution.
- Retention of clients. You can increase the loyalty of you clients, who will not need to look for an additional supplier. This reduces the likelihood of them switching to competitors.
- An additional profit. By reselling the product to the end customer, you can set a higher price and earn more profit. For example, if the development is outsourced to Eastern Europe, and customers are residents of the United States, Canada, Australia, and other Western countries.
- Focus keeping. Development of software and mobile applications is a complex task, and if you don’t have enough experience, it may demand too much time and money. In the case of a white label, each of the parties is engaged in what each does best.
From the point of view of the performers, this format of interaction is also profitable. The essence here can be expressed in one phrase: “You don’t think about whether your code will sell or not. You just do your job.”
There are plenty of examples when teams of programmers write code, while other companies sell products made on its basis under their own brand. Such cooperation is mutually beneficial for all parties.
73% of businesses use white-label solutions to save time and money, and to quickly expand their services. — EPAM Solutions.
We develop it, you deliver it
Our white label development services provide our clients with access to a wide range of web and mobile development solutions. This gives our clients the opportunity to attract qualified specialists to work on IT products, scale up their business, and get quality results within a short time.
If you have questions or would like to receive an assessment on the project, please contact us, and our specialists will give you a free consultation.
Frequently Asked Questions (FAQs):
Digital marketing agencies, design studios, IT companies and start-ups looking to expand their range of services.
Between two and five times faster than developing your own solution from scratch.
Yes, by reselling products at higher prices — particularly when outsourcing to lower-cost regions while serving Western markets.
It offers ready infrastructure, a quick start, client retention, additional profit and the ability to focus on core competencies.
They can concentrate on producing high-quality code while their partners handle sales, marketing and branding.
Last Updated on January 16, 2026 by Lvivity Team
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