Walmart must bear great responsibility for drastically winnowing the expanse of manufacturing in the United States by demanding suppliers constantly hit lower and lower cost targets to feed the Bentonvile Behemoths lust for falling prices. That strategy worked in the short term, but now the company wants to once again tout the Made In The USA Label and is reaping a sparse harvest. In Walmart suppliers grapple with challenge of "Made in USA" labels for Reuters, Nick Carey writes:
Detroit Quality Brushes is a company that does just what its name suggests: It makes high quality brushes in Detroit. Years ago, the company had 18 competitors in the United States. Today, there are only three left, says John Avgoustis, head of marketing and sales. "Walmart and others were a fundamental force in getting many companies to go the way of the dodo," he said. Avgoustis was among some 2,000 executives from U.S. manufacturing companies who journeyed to Wal-Mart Stores Inc headquarters here on July 7 to huddle in tiny conference rooms with Walmart buyers and present products made in the U.S.
Just what counts as made in the U.S., however, is a sore point.
Cheaper energy and rising labor costs in China have helped stabilize manufacturing employment in the U.S., but there are still roughly 5 million fewer Americans working in factories today than in 1990. Would-be Walmart vendors attending the summit had to establish that their so-called "Made in America" products are not just assembled domestically, but also made from component parts manufactured in the U.S. But some companies attending the summit said they have to rely on imported parts or materials because their one-time U.S.-based suppliers have been put out of business by foreign rivals.
Long-term investments in domestic component suppliers is risky when Walmart makes no promises to once-again chase the cheapest price from nations where pesky environmental and workplace laws don't apply.
Avgoustis said the company purchases wood for its brushes from Sri Lanka, and bristles from Sri Lanka or Mexico, because the American suppliers it once used have all gone out of business. Walmart buyer William Loan suggested the company return to pitch samples of plastic brushes. Avgoustis said he has seen other brush companies invest in U.S. production facilities only to have retailers abandon their products in favor of cheaper, foreign-made products. But Detroit Quality Brushes has extra factory capacity, and Avgoustis said that may make it possible to produce brushes with American-made plastic that could carry a "Made in USA" label without a huge expenditure. It is, he said, worth a try.
Once again, an American company is willing to produce an inferior product to appease Walmart. I wish we had more Jim Wiers. Jeff Hess: Have Coffee Will Write.

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