Wal-Mart's Manufacturing Pledge Met With Hope, Skepticism

by Mark Friedman  on Monday, Feb. 24, 2014 12:00 am  

Burt Hanna, CEO of Hanna’s Candle, said Wal-Mart’s orders increased from $4 million in 2012 to $30 million in 2013. By 2017, Wal-Mart is expected to buy $45 million worth of merchandise from his company that manufactures scented candles in Fayetteville. (Photo by Brooke McNeely Galligan)

The details of how the grants will work and who could receive them are still being worked out. More details will be released in March, said Cody, the Wal-Mart spokeswoman.

In August, Wal-Mart also held its first manufacturing summit in Orlando, Fla., where more than 500 suppliers and representatives from 34 states attended.

“It was a meeting point for everyone to come together and discuss the best way to get this done,” Cody said.
At the meeting, suppliers said they plan to invest more than $70 million in factory growth and create more than 1,000 jobs, according to an August Wal-Mart news release.

A PR Risk

Fishman said Wal-Mart doesn’t have a financial risk tied to the manufacturing initiative, only a public relations one.

If the push for more U.S. manufacturing puts the company at risk, or even puts the performance of the company at risk, Wal-Mart “would simply say it doesn’t work for our customers,” Fishman said.

The risk could be in a public relations headache as it was in the early 1990s.

In the years before Wal-Mart’s founder Sam Walton died in 1992, Wal-Mart had a “Made in the USA” section in stores and touted its “Made in the USA” products, Fishman said. “There was a huge publicity effort behind it,” Fishman said.

But it turned out that some of the products weren’t made in the USA. “That turned out to be a disaster,” Fishman said. And people still remember the failure two decades later.

“So that’s the hazard,” he said.

And 10 years from now, there will be news stories on the manufacturing program.

“The real danger is you will intensify the cynicism” if the effort fails, Fishman said.

Cody, Wal-Mart’s spokesman, said that Wal-Mart recognizes that it’s not going to jumpstart the manufacturing industry overnight. “But we’ve already made a lot of big steps toward making it work,” Cody said. “It’s not going away anytime soon.”



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