With its $12.98 T-shirt, this company shows how retail apparel production can thrive in the U.S. - Entrepreneur Generations

American Giant photo via The Wall Street Journal

It isn't fancy -- it's practical. It's sold at Walmart, but it's no import. It's a "Made in America" T-shirt woven with U.S. cotton sold by an American company making a tidy profit off its $12.98 tee, reports Suzanne Kapner of The Wall Street Journal. The T-shirt maker, American Giant, used the "heft" of Walmart's guaranteed sales contracts to garner enough investor support to make affordable "Made in the USA" apparel items possible.

American Giant's success wasn't spurred by tariffs on Chinese imports. Instead, it was Walmart's 2013 pledge to spend more on items that were made, grown or assembled in the U.S. that helped the company grow. Kapner explains, "In 2021, Walmart increased its goal and promised to spend billions more each year through 2030."

Bayard Winthrop, the chief executive of American Giant, said that "without Walmart acting as a backstop by committing to buy a predetermined number of shirts over time, American Giant’s suppliers wouldn’t have had the confidence to make the investments in automation and other upgrades that drove down production costs," Kapner writes. "The T-shirt project brought together what Winthrop has called 'strange bedfellows.'"

The T-shirt is made out of "yarn that is grown, spun, dyed and sewn in the U.S., contracting with suppliers mainly in the Southeast," Kapner reports. "It also owns a cutting and sewing facility in Middlesex, N.C., and is part owner in another sewing facility in Los Angeles, which opened specifically to make the Walmart T-shirts."

Even with its $12.98 price tag, American Giant's Walmart T-shirt competes against similar 100% cotton tees at half the price. American Giant differentiates itself with American emblems, which other apparel makers cannot use. Kapner explains, "Walmart bars suppliers from using the term 'American Made' or the American flag on products that aren’t made in the U.S."

So far, the $12.98 T-shirt boasts solid sales and "American Giant is making 100% cotton sweatshirts for Walmart that will sell for $38.98," Kapner reports. Despite the company's success, "it is unclear how much Americans care about buying products made in the U.S. . . . With the uptick of inflation in recent years, budget-minded shoppers have become even more price conscious."

from The Rural Blog https://ift.tt/NTonXAL With its $12.98 T-shirt, this company shows how retail apparel production can thrive in the U.S. - Entrepreneur Generations

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