<p>A method and apparatus for applying sleeve labels to product containers including a label gripping assembly for engaging a label and pulling it onto a product container (20) and a web positioner (38) for adjusting the position of a next-to-be-applied label prior to engagement by the label gripping assembly. During a label applying cycle, the label being applied is severed from the web (32) along a line of weakness interconnecting the end most label (32a) with the next-to-be-applied label, after the next-to-be-applied moves to a predetermined position located downstream of an initial position. The web positioner (38) reverse feeds the web until the leading edge of the next-to-be-applied label retracts to the desired initial position. The web positioner (38) includes a driven roll and a nip roll that is movable towards and away from the driven roll by an actuator. The driven roll is continuously rotated and the nip roll is driven into frictional engagement with the driven roll in order to effect web retraction.</p>
