Walmart (NYSE:WMT) is hosting a two-day "made-in-America summit" in an effort to get other retailers, suppliers and government officials to support the retail giant's plans to buy an additional $50 billion in U.S.-made merchandise over the next decade, the Associated Press reported.
The summit, which began on Thursday (Aug. 22) and is expected to pull in more than 1,500 people, is intended to be more than just a photo op for politicians and company executives. Walmart says it's trying to get enough other retail chains to buy U.S.-made products to raise the total from Walmart's $50 billion to $500 billion.
That $50 billion goal over a decade is still a drop in the bucket for Walmart, which had $330 billion in U.S. sales in 2012. Even if sales remained flat for the next 10 years, that would represent only 1.5 percent of Walmart's sales. But the chain tried this kind of "American made" campaign in the mid-1990s, and was stymied because it couldn't get enough low-priced goods to meet even such modest goals.
This time around, Walmart and other large retailers have a few advantages: Rising labor costs in Asia, along with oil and transportation costs that are high and increasingly uncertain. Walmart said some manufacturers have told its executives privately that they have identified "tipping points" at which making goods overseas will no longer make financial sense.
Walmart also said that goods sourced in the U.S. already account for about two-thirds of the company's spending on products for its U.S. business. But much of that is grocery and other categories where getting products from overseas would make no sense anyway. Analysts say much of Walmart's clothing, home furnishings and consumer electronics are imported.
- See this Associated Press story
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