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Consumers in China are willing to pay a premium for certain products labeled "Made in USA" because they see them as more durable and of higher quality, a new study found.
The report, by the Boston Consulting Group (BCG), found 61 percent of Chinese consumers would pay more for a product made in the United States. When products are of similar price or quality, about 47 percent prefer the U.S.-made alternative, more than double the number who would pick the Chinese-made item.
"The Chinese consumer is quietly concerned about what they're getting," said Hal Sirkin, a BCG senior partner and co-author of the BCG study.
Consumers are responding to recent cases of lead paint in toys, tainted milk and other scandals that, in some cases, led to severe penalties for those responsible. As more Chinese enter the middle class, they will increasingly look for value in the goods they buy rather than just the lowest price, which will pressure Chinese manufacturers to improve quality, Sirkin said.
As the cost of producing and shipping goods from China rises, more U.S. manufacturers are expected to expand U.S. capacity, BCG predicts. And as U.S. factories churn out more autos and auto parts, electrical equipment and furniture, they could spark an industrial renaissance with 5 million new jobs, it says.
BCG recommends retailers lock in U.S. suppliers to attract shoppers, and is advising consumer brands to make their U.S. sourcing as visible as possible. For now, relatively few do.
"Like all companies, Levi is mostly driven by profit," says Quan, who is unconvinced that Levi has set up camp elsewhere for any other reason than to cut costs. Historically, the textile and garment industries have often been the first to operate efficiently in developing countries because producing textiles requires more unskilled labor and less sophisticated (read cheap) goods. This allows companies to concentrate on increasing profit through design and marketing. Levi's recent plant closures, says Quan, "demonstrate the company's overriding concern with profit." The massive overseas relocation that has taken place for decades is further predicted to increase when the Multi Fiber Arrangement (MFA) is phased out by January 2005. The MFA, an international, Byzantine quota system fashioned in the 1960s to protect First World producers from Third World competition, has shielded the United States from the tremendous jump in Third World textile exports. When the MFA is finally phased out, low-wage producers in developing countries, such as China, will quickly benefit. China's growth potential in the American market is huge, currently, U.S. imports from China are five times as large as its exports, according to a report by the Economic Policy Institute.
Originally posted by mikellmikell
MADE IN AMERICA will be big marketing starting next year. Not MADE IN THE AMERICAS
Originally posted by Sissel His favorite thing to collect were Levi's while they were still made in America. Go figure! Now they are made in his own country!