Walmart Advances Made In U.S.A. Initiative But Faces Challenge

As featured in the July 6 issue of HomeWorld Business, Made in the U.S.A. has become a diverse, sometimes complicated initiative that while open to some scrutiny can also have rewards for vendors, retailers and consumers, and not just in terms of the immediate, emotional sense.

Cindi Marsiglio, Walmart vp/U.S. sourcing and manufacturing, told HomeWorld Business that working with vendors, visiting factories and developing programs to promote the production of goods in the United States gives the retailer’s management a positive feeling.

However, she emphasized that Made in the U.S.A. also makes good business sense. By strengthening communities in the U.S., where the retailer currently operates 4,500 stores, Walmart is putting money into the pockets of consumers who are likely to spend at least some of it at the company’s stores. Made in the U.S.A. even has global ramifications, Marsiglio said. Made in the U.S.A. is part of a larger Walmart initiative to source closer to all its stores and, so, save on transportation and advance its environmental goals.

Ultimately, Walmart wants to encourage all of retailing to consider the benefits of domestic production even as it begins this year’s version of the U.S. Manufacturing Summit. Walmart is only a couple of years into its plan to spend $250 billion on product purchasing in the United States.

But as Walmart takes steps to expand its assortment of American made product, it is also being closely monitored by watchdog groups.

The website recently had some objections to the Walmart program. In June, the organization issued a press release saying it had found more than 100 incidents of inaccuracies in Walmart’s identification of products as Made in the U.S.A. Shana Mueller, a spokesperson, noted, “In the interest of fair disclosure, they are in the process of correcting these problems.”

On a June 22, the organization sent a letter detailing the discrepancies it discovered, she said, and the retailer, on the same day, acknowledged receipt of the letter, and began to make changes to bring the information up to speed by June 26. The press release also noted that Walmart was addressing incorrect Made in America listings on its website.

In reviewing Walmart’s American made products, Mueller said the company reviewed about 2,000 products and found more than 100 examples where other information contradicted identification of a product as Made in the U.S.A.

“We’re tracking all 100 products and there have been changes to the Walmart website,” she said.

The Walmart initiative isn’t the first time has challenged a company about Made in the U.S.A. claims. The organization took Revlon to task over Almay Simply American promotional campaigns and filed a complaint with the U.S. Federal Trade Commission based on its findings. Mueller said the organization had not gone to the FTC with its charges against Walmart.

The main problem detected was, according to a Walmart spokesperson, the retailer’s lagging response to the reshoring of products to the United States. In many cases, Walmart had distinguished the products as domestically sourced but it, or vendors on their own sites, had not updated product descriptions of the origin point after reshoring.

Walmart spokesman Kory Lundberg told HomeWorld Business that, in at least one case, a package marked Made in the U.S.A. was stamped as made overseas because, although production had been brought into the United States, the retailer still was working foreign-produced inventory through its distribution.

Walmart’s quality assurance review, launched after receipt of the letter, has been identifying Made in the U.S.A. items that have foreign manufacturing distribution designations and updating information. Lundberg said that the circumstances had prompted Walmart to institute practices that would synchronize the updating of old information as it initially identifies a product as Made in the U.S.A. Early results of the review suggests that the errors are limited to a small percentage of domestically sourced items, said Lundberg.

Walmart already is undergoing a process that, for reasons of search engine optimization, will be removing online tags including Made in the U.S.A. and Women’s Economic Empowerment, as well as those relating to sustainability. The company is looking at how it might integrate easily discernable identifications of Made in the U.S.A. and other products that address social concerns to more effectively inform customers who want the information, Lundberg said.

For more on Walmart’s Made in the U.S.A. initiatives, see the July 6 issue of HomeWorld Business. The issue’s Made in U.S.A. report also features category-by-category coverage of housewares vendors and their American-made efforts.