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Mary Engle, Executive Vice President, Policy, BBB National Programs and Phyllis Marcus, Vice President, National Advertising Division, BBB National Programs

The phrase "Made in USA" is more than just words on a label – it's a powerful marketing tool that resonates deeply with consumers and can offer a significant competitive advantage to businesses.

With recent economic shifts, including impending tariffs on foreign-made goods, companies may seek to leverage this claim. However, both consumers and businesses must understand the strict standards governing its use.

The appeal of "Made in USA" for businesses is clear. It can differentiate products in a crowded marketplace, attract patriotic consumers, and potentially mitigate the impact of tariffs on imported goods. However, the benefits come with a significant responsibility to ensure accuracy, which is why BBB National Programs’ National Advertising Division (NAD) and the Federal Trade Commission (FTC) rigorously evaluate these claims. 

The FTC's core standard for a "Made in USA" claim is that "all or virtually all" of the product must be sourced and manufactured in the United States. This means all significant parts and processing (including final assembly) must occur domestically, with no, or negligible, foreign content. This is a high bar, and it's where many companies can inadvertently fall short.

If a product doesn't meet the "all or virtually all" standard, businesses may still be able to make qualified claims that clearly indicate that a product is not entirely of domestic origin.

Examples include “60% U.S. Content” or "Designed in the USA," which provide greater transparency about the product's U.S. content or processes without implying a fully domestic origin. The key is clarity and avoiding any misleading impressions.
 

The Role of Advertising Self-Regulation: Ensuring Accuracy

NAD plays a vital role in ensuring that "Made in USA" claims are substantiated. While the FTC has its own enforcement mechanisms, NAD offers a proactive, independent self-regulatory forum for responsible businesses.

When a business raises a concern about a competitor’s "Made in USA" claim, NAD initiates an inquiry. The advertiser in question is asked to provide evidence – such as sourcing agreements, ingredient lists, and manufacturing locations – to support its claims.

Based on this evidence and applying the FTC’s standard, NAD determines whether the claims are substantiated. If not, NAD may recommend that the advertiser modify or discontinue the claims. Companies generally comply, understanding the importance of maintaining consumer trust and avoiding potential referral to the FTC for further action. The NAD's public reporting of these decisions fosters transparency within the industry.
 

Learning from Real-World Cases

Recent NAD cases highlight the nuances of "Made in USA" claims:
  • Procter & Gamble's Native Brand: Challenged by SC Johnson & Son (Method brand), Native had labeled its products as "Born in the USA." The NAD determined this implied that Native products were manufactured in the U.S., and because Native couldn't meet the "all or virtually all" standard, NAD recommended the claim be discontinued.
  • Oral Essentials: GuruNanda challenged Oral Essentials' "Made in USA" claim. Since some key ingredients were globally sourced, Oral Essentials agreed to modify its claim to "Made in USA with US and globally sourced ingredients." This shows how claims can be qualified to better fit the Made in USA standards.
  • Goose Creek Candles: Challenged by Bath & Body Works, Goose Creek had claimed its candles were “poured in USA with the highest quality of ingredients from around the world.” NAD recommended it limit the claim to only the processes or candle ingredients that actually are domestically made. 

Ultimately, whether you're a consumer looking for genuinely American-made products or a business seeking to market them, accuracy and transparency are paramount. As the demand for "Made in USA" products grows, so too will the scrutiny. Understanding and adhering to these guidelines isn't just about avoiding legal pitfalls; it's about building lasting trust and fostering a fair marketplace.