Proudly made in the good ‘ole USA! That’s important to us, right? A resurgent Chrysler has been saying we need to make things “to win.” GM motored through 2011 to post the biggest profit in its history. And President Obama is making American manufacturing might a cornerstone of his re-election campaign agenda. So it obviously matters to some, including prominently the domestic auto industry, and the people who buy Detroit’s output of course. But after what I heard and experienced in New York City this past week, I know Made In The U.S.A. doesn’t matter to everyone.
I was at Toy Fair 2012, the largest toy trade show in the world. There were 4,000 exhibitors, and 25,000 attendees, including some 11,000 registered toy buyers.
This was my first time at the show, so I can’t comment on what it’s been like since the economic downturn. But I can say there was a lot of energy, a lot of confidence on display from both the manufacturers and the retailers, and a lot of business being transacted.
So from a broad, macro level, that is good news for all of us.
Most of my time was spent in an area of Javits Convention Center called the Launch Pad; a spot exclusively reserved for first-time exhibitors.
I overheard a very interesting conversation between the founder and CEO of an eco-friendly, start-up toy manufacturer, and a developer and product broker who sells his stuff to the likes of Restoration Hardware, Pottery Barn and Home Goods.
The toy company makes open-ended, creative play products out of high quality corrugated cardboard. The products are manufactured, assembled, packed and shipped in the U.S.
The designer/broker guy’s model is to take a simple, commodity-type product made in China, add some accessories or accoutrements, also from China or Hong Kong, then sell this basically $2 item to Restoration Hardware or Pottery Barn, who will then sell it to us for $30 or $40.
He asked the toy manufacturer if his products were made in China. He was astounded when the answer came back no. Then the toy guy talked about the superiority of American cardboard, the lack of a huge price point differential between that and Chinese cardboard, and also mentioned how important it is to him philosophically that his products are made here.
The San Francisco-based developer picked up a box, pointed to the MADE IN USA printing in the corner, and said, “That is important to me. I wish it was important to my customers. And I wish it was important to their customers, the end consumer. But it’s not. All anyone cares about is price.”
The San Francisco-based developer picked up a box, pointed to the MADE IN USA printing in the corner, and said, “That is important to me. I wish it was important to my customers. And I wish it was important to their customers, the end consumer. But it’s not. All anyone cares about is price.”
Is that true do you think? When you shop is price the most important consideration? When you talk to customers – and potential customers – about the services you provide do you lead with price?
Back to the American automakers for a moment. For them, “Made in America” is really a matter of marketing. For example, a Honda Accord made and assembled in America has 80% U.S.-sourced parts vs. 65% for a Ford Escape.
However, a new study just released a couple of weeks ago by J.D. Power and Associates shows a rise in Americans who are indeed loyal to U.S. car manufacturers. According to the report:
“The percentage of buyers who avoided import models because of their origin has increased to 14% in 2012—the highest level since the inception of the study in 2003. Conversely, the percentage of buyers who avoided domestic models due to their origin has declined to 6%, a historically low level.”
The trend isn’t limited to automobiles. Last year, the Harrison Group and American Express released a study indicating that 65% of high-end shoppers now prefer to buy American.
What’s not clear is whether consumers have a preference for American products because they believe they are simply better, or because they feel it’s important to support American manufacturing, or a combination.
There is lots of evidence supporting the fact that the enormous loss of U.S. jobs during the recession—manufacturing jobs in particular—has now been accompanied by a corresponding increase in the compulsion to support American workers by buying American products.
There is lots of evidence supporting the fact that the enormous loss of U.S. jobs during the recession—manufacturing jobs in particular—has now been accompanied by a corresponding increase in the compulsion to support American workers by buying American products.
According to ABC News, almost 10,000 new jobs would be created if each American spent an extra $3.33 a week on “Made in the U.S.A.” products.
Manufacturing today accounts for 12% of the U.S. economy and about 11% of the private-sector workforce, but its significance is even greater than these numbers would suggest.
So we all have a vested interest in this topic.
Does the source of a product influence your buying decision(s)? Why or why not? Is this topic on your mind at all as you run and try to grow your business? Are you even wondering why you are reading this type of post here? We would love to hear your thoughts.
{ 6 comments… read them below or add one }
Yes, I definitely notice the origin. I make an effort to support American manufacturers when possible. That said, I do sometimes select products made elsewhere over American products. Price is often a factor, but so is quality. If the quality is the same and the price is even close, I’ll favor the American made. And of course sometimes I just have to have that new toy, regardless of where it was made.
Like or Dislike:
1 
0
I’m like you Steven, it does matter to me, and I do pay attention to the country of origin, but I don’t necessarily make it the first thing I think about when making a purchase. I am typing this on a MacBook Pro, that says “Designed in California,” and “Made in China” on there back, and next to me sits an iPhone 4S. So I am not one to say “Buy American” all the time and cast dispersions on those who don’t. Everything being even close to equal though, as you echo Steven, I try to stay in the USA as much as possible. Thanks for the comment.
I have been searching for a piece of research that addresses this topic in a factual way. No luck so far. The only thing I can find is research similar to the American Express study you cited “… indicating that 65% of high-end shoppers now prefer to buy American.” Saying you prefer to buy is American is one thing actually doing it is another.
My motivation for understanding this issue is simple. I am about to produce a line of golf shirts and can produce here or in Asia. Can one really sell a USA made product for more? Here’s a hypothetical; Two identical golf shirts are side by side; one sells for $45 and made in China, the other sells for $50 and made in the USA. Which shirt will Americans buy? How much more if any are Americans willing to pay for the shirt? Or any other range of products.
If you or any of your readers are aware of research that addresses the actual consumer behavior regarding this issue please let me know. If not, I may decide to do the research and would be looking for anyone interested in participating in the study.
Like or Dislike:
0 
0
If you haven’t yet made your decision, I would recommend you researching “high vs low involvement products”. You will find there are different cues that people look at in their buyer behavior depending on how the product is classified in there heads. This may take a bit of research on your end, but should be worth making considering you are in the business of making money.
Like or Dislike:
0 
0
*their heads*
Like or Dislike:
0 
1
as someone who has no idea other than a fetish for buying new golf shirts (actually you could call it wishful thinking given i am in Minnesota in the middle of winter), my guess is that the actual pro-shop buyer doesn’t care. Nor does the big sports store buyer.
however the channel (the stores, the distributors etc) may care if the American one delivers more reliably, faster. having done a lot of business with the Chinese, i’d much rather do business with Americans as there is no real rule of law or business ethic in mainland China.
Like or Dislike:
1 
0