Why Made in the USA?

By Laura Moffat
Why Made in the USA?

When Kelly and I began our quest to start a clothing brand, we didn’t think it was feasible to manufacture in the USA. It seemed that every piece of clothing we owned said either,  “Made in China, Made in Vietnam, Made in India, etc.” We thought we’d have to coordinate with factories in Asia and wait months for our items to be made and shipped back to the USA.  

But we quickly realized there was a building movement to bring clothing manufacturing back to the USA, and we wanted in.  In 1965, 95% of US clothing was manufactured domestically. Now it is the reverse, with 97.5% of it being manufactured overseas, predominantly in China, Southeast Asia, India and Mexico (Figure 1).



However, more recent data indicates that domestic manufacturing is growing. The American Apparel and Footwear Association found that US apparel production increased 6.2% from 2012 to 2013. Moreover, management consulting firm, A.T. Kearney, found that apparel production was among the top three industries to reshore manufacturing back to the US in 2014. Despite the fact that only a small fraction of clothing production occurs in the US, there are many compelling reasons to manufacture garments here in America. 



Apparel manufacturing moved overseas because of cost, but now wages in China are rising and it is not as cost-effective to manufacture in China. Many companies are moving production to countries where it is cheaper, like Bangladesh, and Vietnam. However, the Rana Plaza disaster in 2013 where an eight-story garment factory collapsed in Dhaka, Bangladesh, killing 1134 people and injuring 2500 people, has made people more conscious about where their clothes are made. American consumers are becoming increasingly wary of mass-produced items and instead want locally made, artisanal goods.

The "Made in USA" label has become a selling point for many US clothing manufacturers. In fact, 72% of Americans said it was important that their clothing be made in the US. A NY Times poll revealed that two-thirds of Americans say they check labels to see if they are buying American goods. And many are willing to pay a premium, 16% more to be exact, for "Made in the USA" products. The reason being is that consumers perceive American-made goods to be of higher quality and more authentic. 


One of the biggest benefits to manufacturing locally, is the ability to easily go to the factory and actually see what is happening on the factory floor. Small brands don't necessarily have the funds or the experience to manage the process effectively from far away. Fanmail owner and creative director, Charlie Morris said "If I manufacture overseas, and I ask for a sample to test quality, they might pick out the best of the bunch for me to approve. Then my garments will sit on a boat for 4-5 weeks, and I won't know there is a problem until it arrives. I manufacture only 3 miles from my studio in New York City, so I can hop on the train to check the quality or fix a problem. When you are standing next to the person making your clothes, it makes the whole process a lot easier."


It usually takes about four weeks for garment production, but if you are manufacturing overseas, you have to factor in the 1-2 months it takes to travel by boat back to the US and the time it spends in customs.  By manufacturing in the US, companies can shorten the time from production to when it actually reaches the customer.  For a small brand, the time on the boat and in customs, is wasted time not making a profit. But even large brands sometimes have to leverage the faster turnaround time of local manufacturing. Fast fashion pioneer, Zara, well-known for bringing fresh items to its store on a daily basis, is able to do this by doing a large quantity of its manufacturing locally in Spain where the company is based. Today consumers expect a steady stream of trendy new styles from retailers. Economist Bill Conerly's US Manufacturing Forecast for 2015-16 predicts, "The apparel industry will continue to bring manufacturing back to the United States because transportation overseas makes fast adjustments to production very difficult. It is particularly a problem when demand fluctuates quickly, as is the case with fashion apparel." 


For Kirrin Finch, and many other small brands, we just don't generate enough quantity to make the large minimum order requirements that the majority of factories overseas require. They often require upwards of 1000 units per style and most small brands are making less than 50. Study NY Creative Director and Owner Tara St James had been working in Asia for many years, but when she started her own brand, Study NY, she was forced into manufacturing locally, "I actually started producing in NY accidentally, because my minimums were so small and it was just easier to do it here. Of course I am happy about it now, but it wasn't a conscious decision at the time."


According to the Bureau of Labor Statistics, 6 million American manufacturing jobs were lost between 2000 and 2011. That is equivalent to the whole population of Scotland or Ireland! Crazy right? Unfortunately when those jobs moved overseas, many of those skills were lost, because many trained workers aged out of the system, with no incentive for the next generation to learn apparel manufacturing skills. China has invested significantly in automation. "A lot of the machines are state of the art and brand new. They also have a work force that is also very fast and well-trained" says Tara St James. "It is going to be a real challenge in the next 20 years to find people. At the small maker level we will fine, but on the mass-scale, we just don't have the skilled workers."   

The only way we are going to gain back those skills and workers is by continuing to drive the movement for quality American made goods. The Million Jobs Project states, "If we all buy just 5% more on US made products we will create a MILLION new jobs." 


The fashion industry turned a blind eye to the conditions at factories overseas for many years. But the collapse of Rana Plaza in Bangladesh forced the industry to face the consequences of poor labor practices and safety infractions in many overseas factories. Consumers are getting cheap trend based clothes from brands like H&M, and Forever 21, but now it is more apparent that it comes with a price. In the documentary, "True Cost", filmmaker Andrew Morgan exposes that the true cost of fast fashion is often human. Shima Akhter is one of four million garment workers in Bangladesh who earn less than $3 a day. In the documentary Shima reveals how she and other workers are brutally beaten when they asked for better working conditions. 

Because the US has stringent labor laws, by manufacturing in the US, there are inherently improved working conditions and higher wages. Unlike overseas factories, it is much harder to hide infractions, because designers and buyers are visiting the factories more often. "You can actually see how the factory works--is there a break room? Do the workers seem happy?"  says Charlie Morris from Fanmail. 


Most manufacturing moved overseas because of the demand for cheaper mass-produced clothes. This was driven in part by the rise of fast fashion, which describes cheap and affordable clothes that are quickly moved from the catwalk and into stores in response to the latest trends. This business model was adopted by brands like H&M, Zara, Uniqlo and Gap. They paved the way for disposable fashion that consumers wear once or twice and then throw away. It is estimated that 12.7 million tones of clothes are thrown away in the US every year. Moreover, the fashion industry is the world's second-largest polluter, right behind the oil industry!

Manufacturing in the US provides the opportunity to use factories that must abide by stricter environmental standards compared to most factories overseas. Carolyn Shafer, Director for Sustainable Design Strategies at the Pratt Institute, says, "it essentially comes down to better regulations and more transparency.  A factory in the U.S. must comply with emission standards defined by the Clean Air Act, while a factory elsewhere has poor enforcement, less strict standards or no standards at all This is not to say the something made elsewhere can't be more sustainable than if it is made here - the U.S. still has a long way to go in terms of environmental protection policy. We do, however have an infrastructure to support our current policy and continue to push it farther in the right direction." 


The answer is yes and no. Yes it costs more if you look at the direct labor costs that go into making a garment, because wages are higher in the US compared to most overseas countries (for comparison the average garment worker in the US makes $2366 per month, compared to $300 in China and $68 in Bangladesh). But there are other costs you have to factor in, such as import charges, leftover inventory, time and cost for boat transportation, cost for an overseas quality control manager and other overhead costs. In a recent Inc article, Bill Waddell a manufacturing consultant explains, "When most companies do their yearly cost benefit analyses, they focus too highly on labor and material costs, but they do a lousy job of taking into account overhead costs, like setting up facilities, travel, and executive pay. For most companies, overhead is responsible for up to 600% of labor." 


Kirrin Finch is manufacturing samples in the production room at the Brooklyn Fashion Designer Accelerator. We are working closely with our patternmaker and production coordinator on a daily basis. It means we are not sending pieces of paper or samples into the abyss and waiting with fingers crossed for months hoping that our product comes back as we had envisioned. Once we go into production, we will work with a factory in New York City. That way we can work closely with the factory to ensure our collection comes through with the same quality as our finished samples. We are excited to be part of a movement of small brands forging a path to make quality goods "Made in the USA."

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