Tuesday, October 19, 2010

Country of Origin Issues

If 90% of my widget is built from parts manufactured overseas, and I do the final assembly here in the US,  can I say my widget is American Made?   Is there a percentage threshold allowing you to say Made in America vs Made in xxxx?

Anthony

Anthony,


Yes, there are rules, and yes they usually depend on chief value, which step or component added the chief value...  You'll usually read this as "Proudly assembled in USA"

Here is how New Balance handles it:
New Balance is the only athletic shoe manufacturer still making shoes in the US. We’re proud of that commitment. We're proud of the workers in our five New England factories.  And we're proud to say that 25% of our shoes sold in North America are made or assembled right here
Made or Assembled in America
Twenty-five percent of New Balance shoes sold in North America are produced by our US workforce using US and imported materials. When possible, we obtain materials from domestic suppliers. At times, due to availability, economic or quality reasons, there is a need  to import components from foreign sources. Where the domestic value is at least 70%, we have labeled the shoe "Made in the USA." Where it falls below 70%, we have qualified the label referencing domestic and imported materials. This determination is based in part on the Federal trade Commission's survey of consumers.
Whole lotta wiggle room there, with a nod to the Feds.  Keep in mind "domestic value" will include all overhead of the operations...  so using just USA labor to make the goods would not be very much cost added...

The expensive part of show making is all of the work management does leading up to the sewing at the end of the line, that management is offshored, making it a less expensive shoe.... 

John


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