US non-branded goods firm Brandless has ceased trading, it has confirmed.
In a statement on its website, the San Francisco-based e-commerce firm said: “After more than two amazing years of bringing customers across the country better for you and better for the planet products, Brandless is halting operations.”
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Brandless provided healthy foods and personal care products under its own Brandless label with a single US$3 price point, although it later brought in higher price items.
Set up by entrepreneurs Tina Sharkey and Ido Leffler, it suggested that by going direct to the consumer it could offer its goods at a 40% discount to comparable branded products. It also pointed to its ability to strip out the necessity to pay a premium for branded goods – something it referred to as a “brand tax”.
But now it has admitted defeat for its model.
Its statement said: “While the Brandless team set a new bar for the types of products consumers deserve and at prices they expect, the fiercely competitive direct-to-consumer market has proven unsustainable for our current business model.”
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By GlobalDataIn an upbeat closing remark it added: “We’re hopeful the future holds a new version of Brandless and that we see you again.”
Reports in the US media suggest Brandless, which raised more than $50m prior to launch, is being forced to lay off its more than 70 employees and shut down.
Sharkey and Leffler hoped to utilise the likes of Facebook and Instagram to build an audience and find customers online. In the food sector it sold products including canned goods, salad dressings, sauces and snacks.
On launch, back in 2017. it said: “Brandless is reframing the outmoded CPG market and starting a movement that ushers in a new wave of consumer-activist culture and transparency.”
The company raised another $240m in a funding round in August 2018.
