Marketplace - American Public Media

What, exactly, does "Made in the USA" mean?

Mon, 2014-09-01 08:48

Labor Day is a day to honor the American worker.  And a day, if retailers have their way, for us to go shopping.

So it’s no surprise that there are companies out there, like Walmart, advertising goods that are “Made in the USA.”  Walmart says that when customers are deciding what to buy, where a product was made is second only in importance to how much it costs.

“Made in America is a very important consideration for many Americans,” said Michelle Amazeen, an advertising and legal studies professor at Rider University. 

There’s a perception, she said, that goods made here are better quality. And that buying those goods will help keep jobs in the country. “It is a very powerful label,” she said.

But if you want to put those four words "Made In The USA" on your product, you’d better mean it.

“If a marketer wants to make an unqualified “Made in the USA” or other U.S. origin claim, the marketer needs to have substantiation that product was all, or virtually all made in the USA,” said Julia Solomon Ensor, an attorney with the Federal Trade Commission.

The FTC has published a 37 page document outlining the standard.

It says that a lovely lamp that is assembled in the America, with American-made brass, and an American-made lampshade, but an imported base, doesn't qualify for the label "Made In The USA."

The FTC will go after companies that don’t follow the rules.

“A lot of companies try and wordsmith their way around the law,” said Bonnie Patten from TruthinAdvertising.org.

Look carefully and you'll see labels saying things like “Designed in the USA,” “Made with U.S. labor,” or even “Made in the USA with imported parts.” 

If you want something truly, fully “Made in the USA” — you’re going to need to read those patriotic labels closely.

A business with a taste for risk and honey

Mon, 2014-09-01 08:13

Every year about 600,000 new businesses open in the United States. Only about half make it past the five-year mark. But of course, that doesn't stop people from trying.

In the early 2000s, Jim Picariello was confident that he had the next great natural foods idea. Just a couple of years before, he and his wife, Jill Day, had moved to a tiny town in Maine. They had just survived the dot come crash and wanted a more peaceful and sustainable lifestyle in rural Blue Hill, Maine. They even built their own home.

After a year of decompressing, Jim woke in the middle of the night with his new product epiphany: Frozen tea pops.

While sitting at his dining room table, he would always make himself a mason jar full of green tea, sweetened with honey, that he would drink while he worked on his laptop. He invariably made too much tea, and would pour the leftovers into a popsicle mold, to freeze and enjoy later. The tea pops were delicious and maybe, profitable.

Picariello quickly raised $25,000 to test recipes and develop his product idea. Before he and his family even realized it, they were starting a new business: Wise Acre Inc.

"When I said go ahead I really didn't feel like we are starting a business," recalls Picariello's wife, Jill Day. "I think that's probably one of the reasons why it even happened, is that I wasn't really aware that that's what we were doing."

The timing was not ideal for the young family: they had a young daughter and a second on the way. But once Picariello began product development, there was great enthusiasm for his idea, and a series of opportunities unfurled in front of him.

In 2007, he took his "Frosteas" and "Frostbites" to the influential Natural Products Expo East trade and was awarded Most Innovative Product, and walked away with a substantial distribution deal.

Quickly he went from making his tea pops in tiny saucepans in his kitchen to needing his own factory and employees. For a while his tea pops were in about 800 stores up and down the East Coast. But it wasn't sustainable, because at that point there weren't enough consumers and his products were languishing in the frozen food aisles. Picariello needed assistance with marketing and advertising, as well as a way to fund production with shrinking resources.

Picariello looked for and found a potential investor, who agreed to a million-dollar deal. The backer advised him to expand quickly and to invest in both production and promotion.

"'Get ready, your first summer is about to kick off,'" Picariello says he was advised. "'Go buy some equipment, cause you're going to make this stuff faster.' So that's exactly what I did. Like an idiot."

Jim immediately invested in some large items, including a pricey blast freezer. He quickly went through money he didn't have and after two weeks there was still no check from the billionaire.

"Turns out a couple days after our meeting, the billionaire, tasted our product and said, "oh I can't imagine why kids would like these." And of course it's not a product for kids, it's a product for adults, and kids do like them."

The prospector investor backed out of the agreement.

"And so at this point I'm sort of doing the math in my head over and over," Picariello recalls. "I have this much money, we have this much payroll, we have this much rent, we have this much electricity. All that over and over and over again."

To keep the business afloat, the family went so far as to start putting payroll on their personal credit card. Without an influx of cash, Wise Acre Inc. couldn't last.

"It was just like, I now have no more money, I have to lay all you people off. And it was very sad."

The bank seized the equipment and the factory closed. Their debts went unpaid, and Picariello declared bankruptcy, of somewhere around half a million dollars.

"We're still dealing with the ramifications," Jill Day laments. "To have the kind of significant debt now that we have because of the business tanking is just like the worst thing that could have happened."

Today, the couple has paid off some of their debts, and Picariello now has a steady full time job. Despite what happened with Wise Acre Inc., Picariello says he might still have one more new product idea to try, but promises it will be much less risky.

PODCAST: Economic effects of protests in Hong Kong

Mon, 2014-09-01 07:38

China is seeing shades of Occupy Wall Street today as protesters gather in Hong Kong. We talk to Juliana Liu about potential economic effects. Plus: two more casinos closed in Atlantic City this weekend, and 5,000 people lost their jobs. We look at the suffering gaming industry in a city that may need to reinvent itself. Finally, most cases of food-borne illness go unreported, so Chicago health officials are turning to Twitter, with a bot that scans for complaints of food poisoning stemming from area restaurants.

 

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