Features, price, service, selection? When competitors offer similar items, what’s the magic that turns a browser into a buyer? According to market research, many shoppers say that a selling point that can seal the deal is when one of the products is “Made in the USA.” If you state on your products or packaging, in ads, on your website or in social media that your merchandise is American-made, are you complying with the Federal Trade Commission’s established standards?A steady stream of recent law enforcement actions reminds marketers of the risks of deceptive Made in USA representations. For example, an FTC action against the maker of home filtration systems alleged that the company’s “Proudly Built in the USA” claim didn’t hold water. In another case, a company imported components from overseas with a false Made in USA claim already engraved on one of the parts. Then there’s the hat company that said its headgear was “Made in USA since 1868.” In fact, more than 70% of its styles are wholly imported as finished products. In the most recent case, an online mattress manufacturer touted its products as “Assembled in the USA.” But according to a proposed FTC settlement, the mattresses were imported from China, already completed.
What can other companies take from the FTC’s actions in this area? If a business chooses to make a Made in USA claim, “all or virtually all” of the product has to be made in America. In other words, all significant parts, processing and labor that go into producing the product must be of U.S. origin.
But another option for marketers is what the FTC calls a “qualified claim” — a representation that clearly explains to consumers the material limitations or specifics. Assuming the underlying facts are true, some examples of qualified claims would be “60% U.S. content,” “Made in USA of U.S. and imported parts,” or “Couch assembled in USA from Italian leather and Mexican frame.”
The FTC’s Made in USA page has resources for businesses. Complying with the Made in USA Standard is a good place to start.
Lesley Fair is a Senior Attorney with the Federal Trade Commission’s Bureau of Consumer Protection. After decades as a litigator representing the FTC in deceptive advertising cases, she now specializes in industry education and outreach.