Chinese Consumers Embrace New Balance's 'Made In USA' Label
In an old brick mill building in Skowhegan, Maine, production line workers are cutting, stitching and gluing New Balance sneakers. The company calls them lifestyle shoes, better known for their looks than their athletic performance.
"The lifestyle shoes have really been on fire, especially with the younger market that we've been after for years. It's more of an iconic fashion statement," says the plant's manager, Raye Wentworth. She is watching a steady stream of New Balance 1400s being assembled. They're classic-looking sneakers in grey suede and blue nylon, with the letter N prominent on the sides.
Most of New Balance's shoes are made in Asia, and Americans love them because they are cheap. It was Chinese factories, in part, that killed New England's once-vibrant shoe industry. But some are still made in America, and in a twist on global trade, Chinese consumers, who love the American-made shoes for their high quality, are helping to keep some of New England's last shoe factories afloat. They seek out that "Made in USA" label.
"The demand is there, and we have 285 people that proudly make them every day," Wentworth says.
Another central Maine New Balance plant employs 365 people. The two factories will make more than a million pairs of sneakers this year, and the company also makes them in Massachusetts.
Jiang Yujun, an office worker in Beijing, says she has bought New Balance shoes for her parents, her children and herself. She says her co-workers also love New Balance shoes, and when she walks the streets in Beijing, she sees lots of young people wearing them.
Jiang says she prefers to buy New Balance shoes that are made in the U.S. because she thinks they are much better made.
John Frisbie of the U.S.-China Business Council says that perception of quality is part of what's driving the demand for exports to China — and it's not just shoes.
"It's been the fastest-growing market for American exports since China joined the WTO, the World Trade Organization, in 2001. So U.S. exports to China — we're talking manufactured goods, we're talking agricultural products, services — U.S. exports to China have grown over 600 percent in the last 15 years," he says.
U.S. exports to China are still dwarfed by U.S. imports. And Frisbie says heavy taxes and other market barriers make American products expensive in China. But he says China's fast-growing middle class is now estimated at 300 million people, and that creates a lot of consumer demand.
Steve Gardner, a manager of the lifestyle division at New Balance headquarters in Boston, wouldn't disclose the percentage of its U.S.-made shoes being exported to China. But he says demand is strong all over the world.
"Whether it's Europe, the U.S., Asia, I think there has been an incredible embrace that, in the first case, probably came from the Japanese market much earlier than a lot of the rest of the world, but now we are seeing a very global embrace of 'Made in USA,' " Gardner says.