Understanding the Retail-Manufacturing Connection

Retailers are all for producing products in China and elsewhere across the world. Why is that? Because it produces a cost savings for them, which they say benefits consumers. Look at Wal-Mart, which currently accounts for 12 percent of all U.S. imports from China. These imported products are produced in large part by...guess who? How about U.S. manufacturers producing under another name in China?

In a statement submitted today to a House Ways & Means Committee hearing to examine Chinese trade practices, the International Mass Retail Association (IMRA) emphasized the importance of keeping markets free and called on Congress to reject calls to “correct” trade imbalances or currency exchange rates. Only by free trade can retailers, as manufacturers’ customers, continue to move products effectively and efficiently within the United States and abroad, IMRA noted.

“Manufacturers are inherently linked to industries that create and serve the markets – distribution industries like retailing, wholesaling, warehousing, transportation and others,” stated IMRA Vice President of International Trade Policy Jonathan Gold. “Manufacturers depend on the retail sector. The manufacturers with the price, quality, style, features and responsiveness to their retail customers should have no reason to impose artificial restrictions on the market. Government regulation of this relationship between a customer and the source of supply will artificially disrupt the market, adding costs and inefficiencies to the system.”

Download the IMRA's testimony here.