Do you know what the familiar phrase ‘Made in China‘ really means? The following will shed some light on the facts behind production origins, labeling, and what those labels mean.
“Made” vs. “Assembled”
When products like computers, children’s toys, iPhones, or Keurig brewers are manufactured, the labeling should legally provide information regarding the country of origin and/or other areas where parts of the products were made or assembled. All products imported and sold in the United States must have labeling information, all of which is regulated by the US Customs & Border Protection Agency (CBP).
A product may be labeled ‘made’ or ‘assembled’ depending on where it was sourced and/or manufactured. “Made” indicates all or most of the parts and components used to make the product originated from that country and were also manufactured in that same country. Sub-assemblies, or components manufactured in other countries, are also indicated in the making of the product; but if they are not significant to the functionality or active essence of the product, sourcing origin is usually not affected. “Assembled” indicates that parts came from other countries and were combined by the sourcing manufacturer who put the parts together to assemble the product in its final form.
Therefore, by law, a product that is “Made in China” will be labeled as such. This is important because import tariff rates are calculated in accordance with the country of origin for each product. It is essential to CBP rulings that the correct country of origin is indicated. When there are doubts as to a product’s sourcing origin – meaning there is difficulty determining where the product was “made” due to its “substantially transforming” features or design – CBP will step in to investigate and make the final determination.
Unfortunately there are some manufacturers in China and the US, by design or through ignorance of the rules, mark products incorrectly. In those instances, consumers find labels that will read “Made in America” or “Made in USA”, but will be sourced from China or India and then simply assembled here. When such situations are discovered by the CBP it will adversely impact an exporter’s and U.S. importer’s reputation, and cause significant delays, increased audits, shutdowns, and costly fines and penalties.
Keeping US Companies Clear & Compliant
One thing that is important about a source manufacturing label, whether ‘assembled’ or ‘made’ in China, is that country of origin should be decided EARLY in the production stages of the manufacturing process. US companies like ITI Manufacturing ensure US manufacturers and entrepreneurs have a clear understanding of source labeling, and that China manufacturers remain compliant with CBP import regulations and rulings. ITI works directly with manufacturers and US companies to avoid penalties from failing to determine a product’s origin. Labeling and product markings are decided early during product conceptualization, or during business planning and outsource negotiations.
When ITI Manufacturing is a part of the China manufacturing process US-based companies can be assured of proper source labeling and avoiding the pain and delays of dealing with legal CBP issues. ITI Manufacturing partners with US companies, as well as the right China manufacturers, and manages the complete offshore manufacturing process. ITI Manufacturing’s proven tactics and strategies developed over the past 40+ years guarantees US companies reliable, repeatable, manufacturing defect-free success shipment after shipment.
If you’re considering ‘Made in China’ outsourcing of goods and products, call 800-574-6823 and speak to one of our experts today. One call could save you money and eliminate your offshore manufacturing headaches.