Making apparel in the USA and retail prices

An article in the New York Times titled “That ‘Made in the USA’ Premium (December 1,2013) describes the growth in US manufacturing of higher end apparel but the continued difficulty in domestic production of lower cost items. It cites production in New York of women’s clothing sold at Saks and Bloomingdale’s but overseas production for items by the same designers that are sold at JC Penneys. With US labor costs 40% higher than China, retail prices have to increase up to 20% more for domestic manufacturing. Competing on speed of response by US manufacturers is matched by air freight offered by Chinese competitors. Should US manufacturers compete by emphasizing quality, rather than production source alone, to justify the higher prices ? Should the guarantee of production environments and ethical practices be emphasized as a reason for US production ? How should volume retailers like WalMart enable US manufacturing while also serving customer interests ?

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About aviyer2010

Professor
This entry was posted in Global Contexts, Operations Management, Supply Chain Issues and tagged , , , , , , , . Bookmark the permalink.

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