April/May 2008

What Made in the USA Means

It’s an election year, and recent product recalls have sparked a demand for domestic-made products. Finding U.S.-made products for your clients can be tricky, so here’s what you need to know.

By Meghan Hurst

Most products are manufactured overseas today, or so it seems. Where’s Bhubaneshwar anyway? Many manufacturers and suppliers have yielded to the pricing pressures of competitive overseas goods, no longer able to compete by providing American-made products. Yet, ironically, there’s a strong demand for the traditional “homegrown” items.

And for some suppliers, sticking to their made in the good old USA roots is more important than saving some green.

What ‘Made in the USA’ means
For starters, it’s important for distributors to understand what it means for products to be USA-made. According to the Federal Trade Commission’s Web site, www.ftc.gov, for a product to be deemed worthy of the label, it must be “all or virtually all” made in the U.S. The FTC defines the term “United States” as “the 50 states, the District of Columbia, and the U.S, territories and possessions.”

The Web site www.lanhamactlawyer.com further explains the FTC’s standards for made in the USA products, stating that “a product that is at least 97% assembled in the USA from U.S.-made parts” is considered to be U.S.-made. It’s a high bar to clear in an age that has shrunken the global marketplace, making foreign parts a frequent contributor to U.S. goods.

Benefits of USA-Made Products
Here are four reasons you can give your clients to buy U.S.-made wearables:
1. Feel-good factor. Knowing products are U.S.-made gives buyers a feeling of patriotism and satisfaction because goods were produced by Americans and not overseas, possibly by child laborers.
2. High quality. Domestic-made products have a higher quality than those produced overseas that use cheaper labor and materials.
3. Faster turnaround time. Since products are produced in the U.S., they can be turned around much more quickly than if they need to be sent overseas for assembly and decorating.
4. Cuts the red tape. When products don’t need to be shipped overseas, messy red tape and Customs issues are completely eliminated, making for a much smoother operation.

‘Qualified’ vs. ‘unqualified’ claims
However, the FTC has an answer to that issue as well. It sets up two categories of product claims. First is the unqualified claim that an item is “Made in the USA” or “American-Made” or referred to by similar terms. Any products carrying such a moniker must meet the “all or virtually all” standard.

Alternatively, there are “Qualified Claims,” which define exactly what portion of the product is U.S.-made or what U.S. contributions went into the assembly of the item. The FTC explains that a qualified claim “describes the extent, amount or type of a product’s domestic content or processing; it indicates that the product isn’t entirely of domestic origin.” For example, a label might read “60% U.S. Content” or “Made in the USA of U.S. and imported parts” or “Assembled in the USA.” For the latter, take care that the supplier has indeed assembled a substantial portion of the product domestically.

Who’s buying
A lot of the demand for domestic-made products comes from union-affiliated organizations “supporting their brothers” by buying U.S.-made products, says John McMillan, vice president of sales at King Louie America (asi/64860), which provides domestic-made products. In addition, many unions require U.S.-made products, says Dari Hariri, founder of Tutti/Bowlingwear.com (asi/92356). Other groups vying for the goods are auto workers, electricians and steel workers, just to name a few.

 

Over the past few years in particular, between the September 11 terrorist attacks and the “War on Terror,” McMillan says people have a stronger sense of patriotism and want to support the country’s economy however they can. After the terror attacks, Hariri noticed the demand for U.S.-made products became “intense,” and that there’s also “some animosity about where products are coming from.”

In addition to union-affiliated organizations, universities; military organizations and affiliated support groups; law enforcement, fire departments and security organizations; and American politicians and government organizations are keen to buy USA-made products.

Pros and cons
As with anything, buying and manufacturing made in the USA products has its advantages and disadvantages. On the plus side, U.S.-made products have a quicker turnaround time, since materials or the product itself aren’t coming in from overseas. Also, “you can be assured that product meets certain standards of quality,” says Al Wartel, president of Arma Sales at Konvex USA (asi/51194).

For Hariri, the quick turnaround time, and therefore excellent customer service that results from working with U.S.-made goods, is his major benefit. “You don’t have to tell a customer that a certain item they’re looking for is sitting at a port in a container, and for some reason or another is delayed,” he says. The frustration comes when a product may be out of stock and can take up to 90 days to come in because it’s imported from overseas. If he’s ever out of a particular style, color or size, he says it takes him just days to fill the order and send it out, since all his products are made domestically.

Another reason people prefer to buy U.S.-made is knowing that social compliance laws, such as those against child labor, weren’t broken. “To an extent, you can sleep better knowing your shirt wasn’t made using child labor or inconvenient labor situations,” Hariri says.

The major disadvantage to producing U.S.-made goods is the higher price. Hariri says that while a shirt made in the U.S. can sell for around $16, the same shirt manufactured overseas can cost $6.25. However, distributors should emphasize that U.S.-made garments, while costing more, do offer a higher quality.

How to find the goods
With so few companies supplying U.S.-made products, finding those that do is almost like looking for a needle in a haystack. However, a simple Internet search for “USA-made” products can produce great results. American manufacturers can also be located using online directories, such as www.madeinusa.com.

To find suppliers in the ad specialty industry, a search tool such as ASI’s ESP Online is a resource. Search for “USA made” or “American made” to access suppliers that offer U.S.-made products in the ad specialty industry.

What to Look Out For While companies may claim their products are totally made in the U.S., this may not always be the case. And just because a product is union-made doesn’t necessarily mean all of the materials used to make the product are U.S.-made. Union-made vs. U.S.-made. Products made by a union-affiliated supplier aren’t always made in the U.S. A union-affiliated supplier may imprint on products assembled overseas, or may assemble products using materials and parts from overseas. According to www.unionlabel.org, union labels “are symbols of quality and fair play” and “demonstrate that the employees who make the product or provide the service are skilled workers who are treated fairly and decently by their employers.” While it’s possible for a product to be made from 100% U.S.-made materials and made in the U.S. by union-affiliated suppliers, it’s important to know that the terms union-made and U.S.-made aren’t the same. False advertising. At times, companies that know their customers want U.S.-made products and are willing to pay a higher price for them may be tempted to stoop to some dishonest practices. Dari Hariri, founder of Tutti/Bowlingwear.com (asi/92356), has heard of companies changing the labels on imported products to “Made in the USA” labels. First and foremost, this is illegal, Hariri says. On top of that, the customer is being seriously deceived by paying more money for a product they think is U.S.-made. The problem with this practice is that it’s very difficult to catch, Hariri says, but there are strict penalties for companies caught doing this. To avoid confusion, Hariri says he only produces U.S.-made products. “I think it’s a mistake to be a company that does both,” he says. When a company works with both U.S.-made and imported products, there may be a hazy line separating imported goods from U.S.-made. To avoid being duped by fake U.S.-made labels, working with a company that produces only U.S.-made goods is a safe bet. End-users should be wary of companies that have traditionally provided only imported goods, and then suddenly come up with a stock of U.S.-made products.

MEGHAN HURST is an editorial intern for Wearables. Contact: mhurst@asicentral.com. TONIA COOK KIMBROUGH also contributed to this report.