What It Takes to Qualify for the “Made in America” Label
‘Merica. Greatest country on Earth. The land of possibilities and dreams. Yet it seems like a lot of the items we use every day aren’t made here. It’s gotten to the point where companies that actually make their products in the U.S. use it as an attribute. Over the years, “Made in the USA” has become synonymous with quality. Today, though, it’s more than just that. It’s about American pride, more jobs, and a strong economy.
But what does “Made in America” actually mean? Can companies just import all the pieces of a product, put it together in a factory somewhere in South Dakota, and claim the product is American made? Are there even any rules?
These are the questions that keep us up at night at QLP. OK, maybe not, but they’re still questions that are worth asking and investigating, which we did (as you can see from the above photo of yours truly)! So pledge allegiance to Old Glory, be thankful you live in this great country, and read on to know if that American flag out front was really made here.
Is It Really Made In The USA?
When it comes to labeling products as “Made in the USA,” the U.S. Federal Trade Commission (FTC) sets the rules. In fact, the FTC can file lawsuits against companies that it feels is misleading customers into thinking their products are made in America.
The FTC recognizes two types of “Made in the USA” claims from companies: qualified and unqualified. If you’re confused, don’t worry; I was, too. But when you break it down, it actually makes sense.
According to the FTC, an unqualified claim that your product is “Made in the USA” means “all or virtually all” of the products’ parts must be made here. So companies can put a sticker, imprint, or anything else that says “Made in the USA” without qualifying the statement. That also means if someone questions the claim, the company should be able to prove that all of the components of that product were made here.
That does brings up another question, though: how does the FTC define “all or virtually all”? Well the commission doesn’t specifically say what it means, just that “the products should contain no – or negligible – foreign content.” However, the commission also gives examples of two different products.
In the first example:
- A company manufactures a grill where the knobs and tubing are imported from Mexico. The grill would constitute a valid unqualified “Made in America” product because according to FTC standards the knobs and tubing would be considered negligible parts compared to the rest of the product.
The second example:
- A company imports the base of a lamp into the country and assembles the lamp at one of its factories. The base of a lamp is pretty important to the product as a whole, so claiming that the lamp was made in America would be misleading.
A qualified claim is what Consumer Reports said in 2013 has caused confusion among consumers in the past. If you’ve ever read the packaging on a product from Apple, you’ll see that it says “Designed by Apple in California, Assembled in China.” This is a qualified claim. Apple wants you to know that all the designing and functionality of that iPhone or iPad was done by employees in America, but the final product wasn’t constructed here.
The main reason qualifying these types of claims is important is because companies can pretty much call themselves whatever they want, have an American-themed logo or message, and still make their products outside the country. Seriously, you can buy an American flag that was made in China.
As long as the packaging is labeled correctly (i.e., where the product was made), then the FTC most likely won’t consider it misleading. You can see where the confusion would come in. American Glove Company sounds like a company that would make its products here, but in fact its labels say “Made in Vietnam.”
As I said above, the FTC can file lawsuits, and companies can face civil penalties for misleading customers about where their products are made. However, according to Consumer Reports, only one company has actually been fined since the late 1990s. Toolmaker Stanley was fined $205,000 in 2006 for allegedly claiming one of its brands of ratchets was made here, but the FTC believed it was mostly foreign.
Another interesting tidbit from Consumer Reports: most of the complaints it receives over American-made product claims come from other companies (usually competitors) claiming the company is looking to gain an advantage over them. However, consumers themselves can file complaints with the commission if they believe they are being misled.
The Comeback of American-Made Products
The Great Recession is actually credited for increasing consumers’ desire to purchase more locally made products. The economic downturn in 2008 showed just how many jobs were lost overseas and caused people to become more aware of the products they were purchasing. The Bureau of Labor Statistics reported about 6 million manufacturing jobs were lost between 2000 and 2010, which was about a third of the total manufacturing jobs in the country.
A couple years ago, some major companies, Walmart and General Electric to be specific, said they planned to invest billions in selling more American-made products. Walmart specifically said it would spend $50 billion over 10 years to source U.S. products, and GE spent nearly $1 billion in 2014 to create 1,500 jobs in the country and to revamp its appliance business in the States.
We at QLP even use the Made in USA label for some of our products. If you peruse our website, you’ll see a lot of products flagged as “Made in USA.” In fact, December is Made in America Month, and we have a whole section for those types of products. Since we work with many different manufacturers to get you your promotional products, we rely solely on them when labeling a product as being made here.
We Love Buying American
Aside from the economic benefits of buying American (i.e. more jobs), studies have actually shown that a large majority of the public wants to buy products made here. That same Consumer Reports study from February 2013, which reported about customer confusion over American-made products, also found that about 78 percent of Americans would prefer to buy a product made in the USA.
Also, more than 60 percent said they would pay more for American-made clothing and appliances. Something I found even more interesting: 25 percent said they would pay at least an extra 20 percent for American-made clothing and appliances. The study also found that more than 80 percent of people believed buying American helps to keep manufacturing jobs strong in the country and keeps the country’s economy strong.
So the next time one of your friends buys you something they claim is made here, you can say, “Is it a qualified or unqualified claim?” They may or may not give you a confused look (actually, they will definitely give you a confused look), but then you have at least a four-minute conversation on your hand. Trust me, it works about 50 percent of the time.
Finally, it should be noted, this article was 100% made in America.
Have you ever wondered about buying American? Would you rather buy something made in the USA? Would you pay more? Let us know in the comments!