Consumer willingness to purchase products with increased 'Made in USA' tariff costs questioned for business owner
Curious to see if customers would shell out more for products made in the USA, business owner Ramon van Meer put his shower heads - usually made in China and Vietnam - up against a domestically-manufactured alternative, priced three times higher due to increased production costs. But the results were far from impressive.
Van Meer, the founder of Afina, decided to test whether the company could successfully reshore manufacturing amid skyrocketing costs due to tariffs. He managed to find a U.S.-based manufacturer capable of producing the shower heads, albeit at six times the original cost. Taking the bull by the horns, van Meer presented customers with a choice between the domestically-produced and the foreign-made shower head, explaining the price difference.
But the overwhelming preference was for the cheaper option - with a staggering 584 purchases of the foreign-made shower head versus zero purchases of the "Made in USA" version. After sharing the results on social media, the post garnered a whopping 10 million views.
"We want to bring back domestic manufacturing. But when consumers face the actual price tag - they didn't," van Meer lamented.
The U.S.'s Outdated Manufacturing Infrastructure
President Donald Trump's administration has been pushing tariffs to cut America's trade deficit and boost domestic manufacturing jobs. But according to van Meer, the U.S. simply doesn't have the infrastructure to meet demand right away.
"[In other countries], manufacturing plants can produce thousands, sometimes tens of thousands, of units a day or a week," van Meer pointed out. "They have been doing this for many years, and they have all the machinery, they have the workforce. But in the United States, I basically had to start from scratch."
He added that he failed to find a single domestic manufacturer capable of fulfilling Afina's monthly orders. The time and investment required to build competitive manufacturing infrastructure presents a significant challenge, even as companies like Apple and Chobani invest heavily in American manufacturing.
A Long Road Ahead for U.S. Manufacturing
Despite the enthusiasm for reshoring, it seems America isn't quite ready to foot the bill just yet. What's more, strict environmental regulations and high production costs make it impossible to manufacture certain products domestically. In the case of Afina's shower head filter, crucial components cannot be sourced from within the U.S.
"There's a lot of products that, even if you wanted to bring it back, it's just not possible," van Meer admitted.
In an all-electric future, America faces similar challenges with the large-scale production of battery minerals. Mining in the U.S. tends to be an expensive venture, often halted by lengthy permit processes and stringent environmental regulations.
Van Meer concluded by urging consumers to take the impact of tariffs on businesses into account. "Some of us cannot even pay the new tariff bills, let alone build our own manufacturing plants," he warned.
Sources:
- U.S. Capacity Utilization Rate
- China Manufacturing Contribution
- Apple and Chobani Investments
- U.S. Reshoring Index
- Cra-Z-Art Reshoring
- Entrepreneur Ramon van Meer, founder of Afina, invested significantly to reshore manufacturing amid tariffs, but discovered the US's outdated infrastructure made it difficult to meet demand.
- Van Meer lamented that despite President Donald Trump's efforts to cut trade deficit and boost domestic manufacturing jobs, the US lacks the machinery and workforce needed for high-volume production.
- Even as companies like Apple and Chobani invest in American manufacturing, the time and investment required to build competitive infrastructure presents a significant challenge for many businesses, including Afina.
- In the case of Afina's shower head filter, crucial components cannot be sourced from within the US, making it impossible to manufacture the product domestically.
- The widespread preference for affordability over Made in USA products was evident when customers chose the cheaper foreign-made shower head over the more expensive domestically-produced alternative.
- Van Meer urged consumers to consider the impact of tariffs on businesses like his, warning that some entrepreneurs cannot even pay new tariff bills, let alone build their own manufacturing plants.
- The large-scale production of battery minerals in an all-electric future may also face challenges in America due to expensive mining ventures, halted by lengthy permit processes and stringent environmental regulations.
