Wal-Mart continues to talk up its “Made in America” initiative that it says will create more middle class jobs. After its own commitment to source an additional $50 billion in products from U.S. manufactures over the next decade, the retailer is also asking consumers to make a pledge of their own.
On Friday (Sept. 27) Wal-Mart asked consumers to join its “Made in America” pledge in an email invitation, by choosing to buy American-made products that will help to create more manufacturing jobs onshore.
“We’re going to rebuild that class of American jobs in the middle that made this country great and rebuild that path to a better life,” Simon said during the two-day U.S. Manufacturing Summit held in Orlando last month.
That quote was part of the message sent to consumers on Friday, communicated through a targeted e-mail to those who have ordered on Walmart.com. Consumers who click on the pledge icon in the e-mail are asked to provide their name, e-mail address and zip code.
In doing so, Wal-Mart can track those shoppers who have a desire to “Buy American” which provides them future marketing opportunities.
The City Wire asked Wal-Mart to comment on the number of pledges received to date, but the retailer declined to provide any specific information at this time.
Wrapped in the star and stripes, Simon continues to beat the patriotic drum, but some wonder what that really means given two-thirds of Wal-Mart’s products are already American made.
Analysts have said this message resonates well the consumers who have proven they are willing to spend a little more for “American Made” products.
The timing for on-shoring many types of product manufacturing has been optimal for more than two years, and Wal-Mart’s more recent decision to champion this cause could move the needle forward given its scale, according to Hal Sirkin of Boston Consulting Group.
Sirkin said labor costs in China in 2000 were 25% of those in the U.S., today there are 50% and expected to rise to 63% in the next two years.
When adding component and raw material sourcing, shipping and overhead costs, Sirkin said the U.S. trumps China for lower overall manufacturing costs of many products.
During the recent conference, suppliers announced more than 1,000 new U.S. jobs with investments in excess of $70 million from GE, Element Electronics and sock-makers, Kayser-Roth and Renfro.
“This is just a start as this economic transformation is taking place and the need to make things closer to the areas of consumption,” Simon said.
Analysts on one hand applaud Wal-Mart for hitching its wagon to the “Buy American means jobs” initiative, but said the retailer was already doing it with their “fresh” and “buy local” campaigns.
The widely reported $50 billion sourcing commitment over a decade, pales in comparison to the $274 billion in U.S. sales Wal-Mart reported last year.
Simon said the sourcing commitment is just a start as the real win-win can be found in small town America were factories like 1888 Mills have reopened to make bath towels for Wal-Mart.
Duncan MacNaugton, chief merchandising officer with Walmart US., said Wal-Mart sells a lot of towels, but the 1888 Mills “Made in the USA” product outsold the others by more than 35%.
“Consumers take pride in buying things made in America,” he said.
The 1888 Mills branded bath towel retails for $9.47 on Walmart.com, it’s priced 17% higher than other towels made abroad also sold on the site. In-store, the 1888 Mills towels sells for $8.28 and are clearly marked “Made in America.”