Wolf

Buy Smart; Buy American

Tom Wolf published this article on September 8, 2011 in Build your Business. Total Comments: 2 | Comment

            In Sunday’s New York Times, Kirk Johnson wrote of a Montana building contractor, Anders Lewendal, who is urging his colleagues in the residential construction industry to “build houses using only American-made materials.”  Mr. Lewendal makes two points: first, using American-made goods will improve the quality of the finished house; and second, it will also stimulate the domestic economy.  He concedes, however, that buying American might add “2 percent to 3 percent” to the cost of a house like the one he’s building in Bozeman.

            I applaud Mr. Lewendal’s suggestion that contractors should look for more opportunities to use American-made products in their homes, but I still don’t accept the premise that buying American automatically raises the cost of construction.

           To a certain extent, Mr. Lewendal acknowledges this point when he notes that the lower price of foreign-made nails is often more than offset by the loss of labor productivity due to quality problems.  For example, while the American-made nails he bought from a firm in Illinois are more expensive than foreign-made nails, they are more uniform and therefore jam nail guns less often.  “If a guy has to get down three times a day to clear the gun,” he suggests, “that’s time wasted.”

           Mr. Lewendal is right about the quality of American-made goods, but I think he’s wrong to assume that this quality is inevitably more expensive.  Our experience at Wolf is that American made products can be both better and less expensive than foreign made products.  In part, this is because differentials between countries in terms of inflation and currency exchange rates have recently begun to shift in favor of American manufacturers.  But, it is also due to the fact that in many cases, American manufacturers made a big effort to refine and streamline their production processes in order to compete with overseas manufacturers back when macroeconomic factors were not working in their favor.

           The result is an emerging American manufacturing competitiveness that should allow the Anders Lewendals of the nation to both buy smart and buy American.  Wolf has found this to be true in its efforts to source new products ranging from kitchen cabinets to decking, trim and moulding products.  We are finding that products made in the United States can in fact compete quite nicely with foreign-made products in terms of both price and quality.

           So while I applaud and fully support Mr. Lewendal’s effort to buy American, I would urge him to test the reflexive assumption that has so long been a part of our thinking that there is an inevitable trade-off between buying American and buying smart.  Thanks to recent changes in the global economy and the creativity and innovation that have long been a part of the American manufacturing tradition, that old assumption is giving way to a new truth that buying American can be both the right and the smart thing to do.