The pandemic has changed or perhaps
even accelerated the trends in consumer purchase patterns and are changing
brand affinities as some companies are doing well in timely fulfillments and
others are not.
Through
all of this there is a general feeling that, at least at the state level, we
are all in this together and therefore a company that focuses on American Made
products may fill a much needed psychological as well as material void.
Geralyn
Breig, CEO and Founder, AnytownUSA.com, speaks to this phenomena as well as her
company’s role in navigating the consumer journey during the pandemic.
Charlene Weisler: Tell
me about AnytownUSA.com.
Geralyn
Breig: Back in 2014, the week that Jay-Z and Solange Knowles had their elevator
fight, what was not being covered on the news in the US was that 100’s of
shoe/clothing factories were being burned down in riots in Vietnam. As
President of Clarks shoes at the time, I had my fall line go up in smoke. It
seemed like a good time to investigate growing manufacturing here at home. I
did a lot of research and consulted with trusted advisors to make sure this was
the right idea. I found a BCG study which says 78% of people want to buy
American, but they don’t know where to find it. Then, I grabbed two former
colleagues with merchant/buyer experience, and we began traveling the country,
going to trade shows and large juried craft shows to talk to the seller
community and see if this is something they were interested in. They certainly
were. American makers are tired of being pushed around by large marketplace
sites. They need a place where they can be seen, and not price shopped next to
a cheap low quality import. Our customers want a site that they can trust! We
always say, the next great marketplace will be trusted, not just huge.
Weisler: Why the
importance of US made products?
Breig: When
you shop at a local store filled with imports, you keep 67 cents in a
community. But when you buy from a maker in the USA, you keep the whole $1 in a
community. One guest on our podcast, The American Made Marketplace, called it
“the circle economy.” Every successful local business employs local helpers,
accountants, photographers, etc. You’re sharing the economic benefit within the
community. But this is not just an economic story. Three out of four Americans
surveyed believe made-in-USA products are better quality, and made with greater
rigor and safety due to our regulatory environment. And, local products do not
ship from around the world, so they are also more environmentally friendly.
Weisler : Can you give
me some data on spending on US products vs imports pre pandemic and how you
think the pandemic is impacting spending?
Breig: On
March 17, our world changed here in the USA. That’s the day San Francisco went
on lock down, and the states tumbled like dominos after that until 91% of the
US population was under some sort of “Stay Home” order. It seems like
forever-ago, but it’s less than a month as we talk here. The impact will be
extensive but has not yet been calculated. Clearly the global supply chain was
massively disrupted with both production and shipments halted. At the same
time, businesses deemed non-essential here in the USA - - consumer speaking, that’s pretty much
everything but food and groceries - - have also shut down. It’s too soon to
count the impact of all of this other than the 10% and rising unemployment
rate. However, it is very apparent that the smart money is learning the
limitations of adhering to a strict just-in-time inventory strategy, and, of
100% off-shoring. The winners this year will be those with inventory to sell,
and that means those with a capability to produce close to home, sell online,
and distribute direct to customers.
Two quotes
I’ve seen that sound relevant to me: “It’s amazing how slowly habits change,
where people get stuck in the ruts of doing things, and then you have a shock
like this that can change everything,” said Erik Brynjolfsson, director of the
MIT Initiative on the Digital Economy. “It forces people to overcome the
switching costs, figure out something new and say, ‘Hey, this is way better.’ ”
- Washington Post 3/21/20
Executive
Director of the Rhode Island Manufacturers Association, David Chenevert appeared on GoLocal LIVE April 9,
2020 where he discussed the state of the state's manufacturing industry during
the coronavirus crisis: "What I’m seeing, and I said this to the Governor
and [RI Commerce Secretary] Stefan Pryor, is that in my opinion, the silver
lining that’s going to come out of this situation, is the rezoning of a lot
more component parts and products being shifted back to the United
States." "I’m not saying we’re going to have all of it, but I think
the major corporations in the U.S. are going to say, ‘Hey, maybe we should be
20/80, 30/70, or 60/40 relative to outsourcing' — I see a lot more reshoring
coming back," he said.
Weisler : What are some
of the challenges in US made? What are some of the benefits and opportunities?
Breig: With
less than 5% of products that we buy in most categories made-in-the-USA, the
primary challenge is simply finding them. For example, in 1960, an average
American household spent over 10 percent of its income on clothing and about 95
percent of those clothes were made in the United States. Half a century later,
the average American household spends less than 3.5 percent of its budget on
clothing and only 2% is made-in-USA. Bad actors take advantage of this by
naming their company American this or that when their line is actually
imported. And many mislabel their items “Made-In-USA” when that designation is
reserved by the FTC only for items that are “all or virtually all” comprised of
Made-in-USA materials. So, scarcity and confusion reign. What we saw was an
opportunity to create a marketplace that was trusted, not just huge. The large
marketplaces have less than 1 % of their items made-in USA, and they do little
to no screening of Sellers to prevent frauds and fakes. Our site is selling by
invitation only, Sellers’ identities are validated, and items sold are
certified made-in-USA in compliance with FTC guidelines.
Weisler : Can you talk
about any of the data you collect on spending in your business and how it is
impacted by the recent events?
Breig: We
launched about 18 months ago so we are an early stage business and sales have
been doubling or tripling every month versus year ago for some time now. But
April 1 was a major inflection point. Since then our sales increase jumped
daily from +1000% to +10,000% versus year ago. Traffic and new users are up
over +30% and even our Average Order Value is up +20%. And that’s all on the
exact same marketing spending level as last month. I think this crisis has
shaken people out of their Amazon coma, and encouraged people to try new things
and to care just a bit more about where the items they buy are coming from and
who is benefitting from their purchase. We are delighted to provide a platform
for USA makers who are small to medium businesses, and have had their
livelihoods upended.
Weisler : What is your
best-selling product?
Breig: At
the moment, we have US makers who have pivoted their production from their
devastated businesses such as children’s clothing, travel gear or beauty
products to make face masks for kids and adults, and hand sanitizer. These
makers are donating hundreds of items in their communities, and, selling here
to make up some of the sales they have lost due to retail channels shutting
down. In “normal” times though, our top sellers change with the seasons. For
example, jewelry at Valentine’s Day, beauty gift sets at Mother’s Day,
flip-flops in the summer, hats and gloves in the fall, Christmas decorations in
Q4, and unique gifts always.
Weisler : What do you
see as the future of your business?
Breig: We
are serious about building a thriving USA maker community. Currently, we are
building a suite of services of all types for our sellers. This is really
exciting and will include incredible opportunities that are only available to
sellers on AnytownUSA.com. And, we’d like to expand our marketplace to all
forms of made-in USA goods that buyers are having an increasingly hard time
finding. Even trusted food brands like Oreos® have been off-shored, so we’d
like to bring a “farmer’s market” of certified USA made and grown foods online,
and there’s so much more.
This article first appeared in www.Mediapost.com
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