White Label Pricing means, partners purchase the company's products or services at a discounted price and rebrand them as their own. The partner's revenue is the difference between the discounted price they pay and the price they charge to end customers.
How White Label Pricing Works
White label pricing has two prices, not one. The vendor sets a wholesale price, the discounted rate the partner pays to buy the product or service. The partner then sets the retail price, the rate the end customer pays. The partner's margin is the gap between the two. The end customer never sees the vendor.
The mechanism runs in a clear order:
- The vendor sets a wholesale price below its own list price. This is the partner's cost.
- The partner rebrands the product as its own. This is the line that separates white label pricing from a plain reseller arrangement, where the partner sells under the vendor's brand.
- The partner adds a markup and sets the retail price the end customer pays.
- The partner keeps the difference between retail and wholesale as gross margin, and carries its own costs of sales, support, and branding out of that margin.
Wholesale itself can be charged a few ways. A flat license fee is a fixed recurring rate no matter how many end customers the partner serves. Usage-based pricing scales with the partner's consumption, such as active users or volume. Tiered licensing gives a deeper discount as the partner buys more. The right structure depends on how predictable the partner's volume is, which is the same fit question covered in the white label entry.
White Label vs Reseller vs Commission-Based Pricing
These three pricing models look alike because all three pay the partner from the spread between a discounted cost and a customer price. The difference is whose brand the customer sees and how the partner gets paid.
| Model | Whose brand the customer sees | How the partner earns |
|---|---|---|
| White label pricing | The partner's own brand | Buys at wholesale, sets its own retail price, keeps the spread |
| Reseller pricing | The vendor's brand | Buys at a discount, resells at a markup, keeps the spread |
| Commission-based pricing | The vendor's brand | Refers or closes the sale, earns a percentage of revenue |
The practical line: white label hides the vendor entirely, a reseller sells the vendor's named product at a markup, and a commission partner never owns the price at all.
What Partners Actually Charge
There is no fixed markup, but the agency world has a common starting point. Conduit Digital, a US digital agency, publishes a 1.5x markup as its rule of thumb. In their worked example, a service that costs the partner $1,000 is presented to the end customer at $1,500. They mark higher-value work such as search and paid media up further, to 1.6x or 1.8x, because the measurable return supports it.
Setup costs are separate from the markup. Monetizely, a SaaS pricing consultancy, reports that white label technology deals often carry a one-time setup fee of $5,000 to $50,000, scaled to how complex the integration is. A partner should price that fee into the first year, not bury it in the monthly markup.
Frequently Asked Questions
How much to charge for white labeling?
There is no single rate. A common agency starting point is a 1.5x markup on your wholesale cost, so a $1,000 service is sold at $1,500, per Conduit Digital. Raise the markup for higher-value work, and price any one-time setup fee in on top.
What's the difference between OEM and white label?
Both involve one company making a product another company sells. With white label, the buyer rebrands a finished, standard product as its own. With OEM, the maker supplies a component or product built to the buyer's spec, which the buyer then puts into its own offering. White label is about the brand on a finished good; OEM is about who built it to order.