What is Made in the USA?

by Elizabeth Domnisch

So you’re looking for MUSA goods and products? Congratulations on your brilliance and a sincere thank you! We American manufacturers thank you for your recognition of the superior quality of American made products and your commitment to the improvement of our way of life by buying MUSA.

In this post, I just wanted to clear up what the Federal Trade Commission and other organizations qualify as “Made in USA” so you can be an informed consumer. 

What is a “Made in USA” claim?

First off, there is no one claim that the Federal Trade Commission (FTC) regulates. The label can read Made in America, Made in the USA, American Made, or any other phrase or graphic that implies to the customer that the finished product is made stateside.   In their words,

“In identifying implied claims, the Commission focuses on the overall impression of the advertising, label, or promotional material. Depending on the context, U.S. symbols or geographic references (for example, U.S. flags, outlines of U.S. maps, or references to U.S. locations of headquarters or factories) may convey a claim of U.S. origin either by themselves, or in conjunction with other phrases or images.”

This is the example given on the website, to help us understand.

Example: A company promotes its product in an ad that features a manager describing the "true American quality" of the work produced at the company’s American factory. Although there is no express representation that the company’s product is made in the U.S., the overall — or net — impression the ad is likely to convey to consumers is that the product is of U.S. origin.

 

To be able to claim Made in the USA, the product must have “ all or virtually all” of the product must be made in the states.  Companies also cannot make this claim for entire product lines if only SOME of the products are Made in the USA.  

However, the Made in America movement ( an incredible organization representing over 20,000 companies ), says on their website that their standards for members are: 

“For MAM Membership, your product(s) should be at least 70% American made: raw materials, labor, and any related costs go into this figure; final assembly of the product must be in the USA. The company must be American owned. Service providers, suppliers, distributors, on-line retail stores, business associations, alliances, and organizations must be headquartered (100%) in the US and must employ US citizens. A letter of authenticity on company letterhead stating locations of all offices within the United States of America will be required.”

 

And the organization MadeInAmerica.com describes Made in USA this way:

“A lot of brands claim that their products are made in the USA, but what truth does that really hold? Automobile, wool, textile and fur product brands have specific laws that require them to disclose U.S. content-all other products can use the “Made in the USA” label for marketing as long as they follow certain requirements listed by the Federal Trade Commission (FTC).
The FTC’s “Made in USA” policy requires brands to be transparent about the origin of the materials and processing used for production. They do so by making brands follow specific guidelines before listing a product as American made. The policy applies to U.S. origin clams that are directly stated or that are implied through symbols or contact in advertising.”

 

What does the  “all or virtually all” standard represent?

So what does “all or virtually all” mean? There aren’t specific numbers or percentages that are given on the FTC website as to what constitutes “all or virtually all.” Which can be confusing since it is left open to interpretation. According to the website,

"All or virtually all" means that all significant parts and processing that go into the product must be of U.S. origin. That is, the product should contain no — or negligible — foreign content.”

 

Factors Considered in “All or Virtually All” Claims

Ok, so what factors does the FTC actually consider when deciding if a product is “all or virtually all” Made in the USA?  Well, the first thing they consider is if the final processing or assembly is here in the US. That is not negotiable and once that has been established, the next thing to be considered is how much of the final costs of the manufacturing process can be attributed to American parts and processes. And they also look at how far removed any foreign materials are from the finished products. Again, in their own words:

“The product’s final assembly or processing must take place in the U.S. The Commission then considers other factors, including how much of the product’s total manufacturing costs can be assigned to U.S. parts and processing, and how far removed any foreign content is from the finished product. In some instances, only a small portion of the total manufacturing costs are attributable to foreign processing, but that processing represents a significant amount of the product’s overall processing. The same could be true for some foreign parts. In these cases, the foreign content (processing or parts) is more than negligible, and, as a result, unqualified claims are inappropriate.”

 

Qualified Claims vs Unqualifed Claims

So you noticed the phrase “unqualified claim,” in the last section did you? What is an unqualified claim versus a qualified claim?  To put it simply, an unqualified claim claims the entire product is Made in the USA, while a qualified claim breaks down the parts and processes made or performed in the US.  For example, a label that reads “ Assembled in the USA with parts from Mexico,” is an example of a qualified claim. 

But even these qualified claims can be misleading sometimes so the FTC offers this guidance on qualified claims.

"A qualified Made in USA claim is appropriate for products that include U.S. content or processing but don’t meet the criteria for making an unqualified Made in USA claim. Because even qualified claims may imply more domestic content than exists, manufacturers or marketers must exercise care when making these claims. That is, avoid qualified claims unless the product has a significant amount of U.S. content or U.S. processing. A qualified Made in USA claim, like an unqualified claim, must be truthful and substantiated.”

This isn’t a comprehensive explanation of all the regulations around the claim “Made in the USA” according to the FTC, but it is a good place to start. If you wanted to dig into the issue more, you can pop over to their website to read more about it at: 

 

 

FTC

You can also check out The Made in America Movement  

where you can also find a list of companies that are Made in America

Alliance for American Manufacturing

Made In America.com 

USA Love List

USA Love List Directory of Made In The USA

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