Does "Made in the USA" Increase Sales?
Just because Apple is based in the U.S. doesn’t mean its products are manufactured here. In fact, the company’s ultrapopular iPhones and iPads are made in China. That’s true of many goods produced today by American businesses, large and small.
As recently as the 1980s, manufacturing accounted for a quarter of all U.S. labor, but since then it’s fallen to half that, Fortune reports. There's no denying that there are some clear cost advantages to outsourcing manufacturing. For example, companies can manufacture products for about three-quarters of the costs of U.S. manufacturing by moving operations south to Mexico, due to cheaper labor costs and tax incentives, an analysis by consulting firm Alix Partners shows.
So, why should you consider manufacturing your products in the U.S.? Here are three compelling reasons.
- American-made goods are generally considered safer to use than foreign products. Manufacturing plants outside the United States often do not need to meet strict regulations regarding the materials used in their products. Businesses that can proudly say their products are “Made in the U.S.A.” — and label them accordingly — can benefit. For instance, in 2007, after a spate of lead-poisoning scares related to toys made in China, domestically produced Holgate Toys saw a surge in holiday sales.
- U.S. consumers concerned about ethics and the economy prefer to buy domestic goods. Many Americans concerned about job losses at home, worker conditions overseas, and environmental considerations prefer to spend their dollars on products made in the U.S. — even if they have to spend more for the items. A study by The Wall Street Journal found that consumers who knew a cotton T-shirt was ethically made were willing to pay more than $21 for it, but would spend less than $18 for a shirt if they believed its production harmed the environment (or was shipped long distances).
- It’s easier to control your manufacturing process. When your manufacturer is based in the U.S., it’s easier to manage the entire process, from production and quality control to shipping, because you can visit the plant virtually any time. “Since we control the assembly process very closely, we can change designs in both hardware and software very quickly to meet customer demands,” Trent Mulligan, sales and marketing manager for electronics company AVocation Systems, told CE Pro magazine.
Other companies that manufacture their products in the U.S. include Sub-Zero, Weber, and Harley-Davidson. Follow suit, and you might capture a loyal audience for your authentically American products.
Kathryn Hawkins is a business writer for Intuit and is passionate about solving small business problems.