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Made Up in the USA

Made In The USAWhen Walmart announced last year it was going to launch a major push on domestically-made products—helping to fund some of the suppliers, in fact – it set off a jingoistic feeding frenzy.

All of a sudden everybody and his shopping brother was envisioning a plethora of product produced right here in the good old U.S. of A. Politicians jumped on the bandwagon, of course, visions of full employment and happy voters in their heads.

It was a wonderful story. And it would have been even more wonderful if it were actually true.

Because any discussion of wide-scale manufacturing returning to the United States needs to be put into context…and reality First off, this isn’t Walmart’s first manufacturing renaissance rodeo. Way back in the days of Mr. Sam, Made in the USA banners hung proudly in virtually every store the company owned. Many went so far as to single out exactly where the products were made, highlighting those in the immediate proximity of individual stores.

Even then, most goods sold in Walmart– as in most goods sold in most stores, to be fair – were already being made overseas. When Richard Nixon got back from his historic trip to China in 1972, the next day the flight to Beijing was full of American businessmen looking to source product over there.
Walmart kept flying the flag for years, but eventually it became pretty embarrassing when just about the only things still domestically made were the banners themselves. The signs went into storage and haven’t been seen since.

Not that anyone should blame Walmart…or any supplier or retailer in the country. They were just giving the American consuming public what they wanted: cheap stuff.

The math is a little hard to do, but the reality that saw manufacturing jobs disappear is well balanced on the other side of the equation by access to consumer goods that could never have been afforded by the average American before the advent of low-cost overseas manufacturing.

Domestications

It is against this consumption landscape that the most recent spurt of Made in the USA fever has returned. Which is why a reality check when it comes to home furnishings products is very much in order.

Yes, we make a lot of cars here and a bunch of processed food too. We make some spiffy shoes and some high-end clothing.

But what we don’t make here are many of the products that we put into our homes. Virtually every household kitchen appliance smaller than a microwave oven is made overseas. About three-quarters of all the furniture we buy comes from Asia. Dishes, frying pans, can openers: they are basically imported. Even products like sheets and towels, which as late as the turn of this century were still largely domestically made, are now 95% imported.

So, when people start talking about the return of manufacturing to the United States, what are we really talking about? Walmart’s domestic initiative involves a small handful of suppliers, including a company that makes towels (ironically a Pakistani-owned entity that bought a small mill in Georgia) and a family owned curtain producer that is setting up a facility in the Carolinas. Together, these products will represent a percentage of Walmart’s business somewhere far to the right of the merchandising decimal point.

In the meantime, two foreign companies – one from India, the other from Mexico – have publicly stated they intent to open yarn-spinning mills in the US sometime in the next few years. If you’re thinking Norma Rae or Driving Miss Daisy textiles mills with hundreds of employees, think again. Modern spinning mills are largely automated with very small workforces. And while they represent significant capital investments, the chief appeal of setting up shop in North America is access to cotton and increasingly cheaper, always-reliable American power.

Factory Towns

There are a few other exceptions to the rule. Most wall-to-wall carpeting is still made in the United States, largely because the economics of freight costs don’t really work for large, bulky products. The same rule holds true for mattresses and large appliances like refrigerators and washing machines.

But while the largest furniture company in the world, Ashley, is building a new factory in North Carolina, it is the exception rather than the rule when it comes to that industry.

Nobody is building full-fledged textiles mills with massive weaving and finishing operations. There’s no talk of new factories spitting out toaster ovens and blenders. All of this makes for wonderful feel-good headlines but the truth is somewhat less patriotic. The truth is that the most widespread thing being made in the USA is still stories about products made in the USA.

Warren Shoulberg is editorial director for several Progressive Business Media publications for the home furnishings industry. He infrequently checks country of origin labels.  

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