The Economics of “Buy American”

Made from silver-toned brass, Hampden Corporation's Ashten pocketwatch is a stunning USA-made awards piece. It is water-resistant up to 100 feet.

The Original Thunderstix from Vonco Products are one of the company's many creative, American-made products.

The Full Color Year-at-a-Glance Laptop Calendar from Finn Graphics uses a removable adhesive, letting it stick to computer surfaces cleanly.

Bruce Fox has a vast catalog of award designs, fitting nearly any occasion. Classical plaque and optic crystal awards, as well as contemporary designs, are available.

American Apparel's Unisex Cotton Piqué Tennis Shirt has a 4.5 oz. fabric weight and is available in 18 colors. Sizes run from XS to 3XL.

In a world driven by the bottom line, how American manufacturers 
are able to thrive

American manufacturing, especially in our industry, is sort of a riddle. The economic advantage gained by importing should make stateside production impossible, an easy fact driven by the math of lower production costs and profit-by-volume. Yet this is anything but the case.

American manufacturing is not only able to defy the economics of scale, it’s doing so in places and markets that it should have no business competing. From T-shirts to stickers, some U.S. manufacturers have managed to beat the presumed-unbeatable question of “Can you go under the importer’s margins or not?”

Is manufacturing less of a numbers game than people think? Or are there just different rules for success than what’s assumed? How are these companies able to succeed where it should be impossible, and most importantly, what can you learn from them and apply to your own business?

Creativity: The Main Differentiator?
The main line of thought on how American manufacturing companies are able to compete with importers is that U.S. manufacturing is faster, safer and more nimble. While this is likely true to a degree, it can’t be the only reason. After all, there are importers who can match these qualities in varying or superior degrees, so there have to be other elements driving the success of American manufacturers.

An idea worth considering is that it’s creativity, not service alone, that causes many American companies to thrive. Many of the companies interviewed for this piece enjoy positions as creative leaders in their product categories, and have managed to successfully get their items desired for their cutting-edge and captivating designs (see American Apparel, Hampden Corporation). It makes sense, considering that having new, beautiful or innovative items that are also exclusive is a powerful buying motivator that operates outside the realm of the economies of scale, making it a sales element unaffected by importers’ price advantages.

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  • luxuryeco

    Are American Apparels’ fabrics made in the USA or are they just assembled here?

  • Mike Cornnell

    @Luxuryeco: I think it varies by product? I’m pretty positive that some fabrics are imported, like their denims for instance, while other are milled into fabric in-house. I’m not 100% on that though, so I would call them to double-check. I also have no idea how much of their raw materials, like cottons and dies, come from U.S. sources.