Table of Contents
DENVER — Walmart is using its size and buying power to fuel a “Made in the U.S.A.” movement that can generate jobs for Americans and spark an economic revival in local communities.
Walmart is using its size and buying power to fuel a “Made in the U.S.A.” movement that can generate jobs for Americans and spark an economic revival in local communities.
Last month the company hosted a U.S. Manufacturing Summit here that brought together 1,400 suppliers, government officials, industry experts, financiers and others to discuss ways to revitalize domestic manufacturing. The conference, at the Colorado Convention Center, was the second such event since Walmart’s 2013 pledge to buy an additional $50 billion in U.S.-made products over the next decade.
More and better jobs for Americans also benefits Walmart by boosting its customers’ spending power, Doug McMillon, the company’s president and chief executive officer, said at the outset of conference.
"We need manufacturing here because we have so many stores here, and we need the jobs so people who live near those stores can shop more."
Kathleen McLaughlin, president of the Walmart Foundation, announced at the conference that seven universities would receive grants totaling $4 million to fund innovative research that supports new manufacturing processes. The awards were made possible through the collaborative efforts of the Walmart Foundation, Walmart and the U.S. Conference of Mayors. The partners have pledged $10 million over five years to finance a Walmart U.S. Manufacturing Innovation Fund to spur innovative research toward manufacturing.
This year’s grant winners are:
• Georgia Tech Research Corp., for innovation of thread-count-based fabric motion control, a critical enabling technology for the automated production of sewn goods.
• Indiana University-Purdue University at Indianapolis (IUPUI), to advance and accelerate the industrial implementation of metal 3-D printing for the manufacturing of plastic injection tooling as an alternative to current metal-shaping practices.
• North Carolina State University College of Textiles, to address challenges to manufacturing of furniture cushions in the United States by implementing new technologies in both fabric printing and cut-and-sew automation.
• Oregon State University, to develop two novel alternative mold fabricating approaches, and evaluate for functionality, precision and cost-reduction potential.
• Texas Tech University, to support collaborative research on cotton breeding and biotechnology, cotton production, and various aspects of textile manufacturing, dyeing efficiency and specialty finishes.
• University of Texas at Arlington, to develop a novel manufacturing system that will autonomously prepare small motor subsystems and assemble the motor components.
• University of Georgia Research Foundation, to develop an innovative approach to fabric dyeing that will greatly reduce, and perhaps eliminate, the need for water in dyeing cotton and cotton/polyester fabrics and yarns.
With the additional $50 billion pledged last year, Walmart estimates that it will spend $250 billion through 2023 to buy American products to sell through its 11,000 stores under 71 banners in 27 countries and e-commerce websites in 10 countries. Boston Consulting Group Inc. has calculated that the $250 billion investment by Walmart could create a million jobs in manufacturing and related services.
The commitment could help dispel one popular perception of Walmart — that the retailer has played a significant role in crippling the U.S. manufacturing sector by sourcing so many of its products from China and other developing economies.
But Walmart executives and some industry analysts point out that making things in the United States can be a smart business move by increasing the efficiency of the supply chain and capitalizing on the narrowing difference in manufacturing costs between domestic and Chinese suppliers. Boston Consulting Group found that China’s cost advantage in manufacturing has narrowed over the past decade. Average costs in China are now just 5% lower than those in the United States, compared to China’s 14% advantage in 2004.
The Denver summit included nearly 400 private meetings in which manufacturers and suppliers conferred with economic development officials of different states to discuss locations for new or relocating facilities.
Last year’s summit, in Orlando, Fla., produced commitments for manufacturing investments from several companies, including industrial conglomerate General Electric Co., home hardware and lighting products manufacturer Hampton Products International Corp. and leggings and sleepwear supplier Kayser-Roth Corp.
