That happens in the US as well. Aldi and Costco have a lot of their own brands. Roundys used to be the generic brand of a nearby grocery store, but then Kroger bought them out. Kroger owns multiple chains of grocery stores across the country, including different ones in the same town sometimes.

The funny thing is that they probably use the same manufacturers as the popular brands and just also a different label on it.

No "probably" about it. The price of entry into a supermarket's inventory is often a discounted-enough rate on white-label stuff that they can sell right beside you. I got an education stocking shelves at a supermarket as a kid. Pretty hard not to make the connection when the bakery dropped off loaves of store brand and their brand, intermixed in the same trays, and we had to separate them out.

> The funny thing is that they probably use the same manufacturers as the popular brands and just also a different label on it.

They absolutely do. For example, Costco has two Kirkland Signature vodkas. One of them is Grey Goose, and the other I forgot. Skyy? Same goes for their tequila, it's all Jose Cuervo.

Look up Frank-Lin distillers sometime.

https://ello.co/dredmorbius/post/bztu6ot3xumpeiiiygdzaa

http://www.frank-lin.com/

http://www.dailyrepublic.com/news/topstories/fairfield-offic...

http://www.webcitation.org/5jjmHRr9C

and the rest of the grocery stores are probably safeway..

This happens in all supermarkets of Europe, basically. Examples from Germany:

Depending on the store you get either mostly only store products (Aldi, Lidl), both store products and brand products (Kaufland, Rewe?) or mostly brand products (likely Edeka)

The case of what you mentioned is the reason why the Schwarz Group (Lidl and Kaufland) are moving overseas, respectively to the US and to Australia: there isn't much price competition.

Disclaimer: work for them.

American grocery stores have been doing this for a long time as well. Often their products taste better too because they use less added sugars and preservatives.

I remember a story about M&S in the U.K. Up until a few years ago they only sold their own brand food, which had a higher price and a higher perceived quality to other supermarket brands.

The story goes that their biscuits are made in the same factory and cooked in the same batch as other brands, but M&S required that their biscuits be taken from the centre of the tray where they were cooked in the oven more evenly.

I swore off Nilla Wafers in favor of store brands in the 90's because Nabisco ruined them by trying to extend the shelf life with preservatives so much that they were never crispy out of a fresh box and had an awful taste. Years later I discovered they changed their ways with a foil lining instead of the preservative overload but I still won't buy them.