“Honesty is for the most part less profitable than dishonesty” – Quote from Plato’s Republic.
Made in Italy, Made in America, Made in Germany and yes Swiss Made… Each one a powerful label. Research shows that just putting ‘Made in Germany’ on your product will make your customer accept a 20% price increase. But what do these labels really mean and do they warrant this incredible premium they carry?
What is important to understand is that ‘Made in’ labels, mean different things in different parts of the world. Even within a single country, different interpretations may exist for different product categories. Confusing isn’t it? You’d think they do it on purpose… What the labels mean, and more importantly don’t mean, is also a political issue and influenced by lobbying efforts.
The labels are meant to inform the customer on the origin of a product. But what is origin?
Let’s have a quick look at the EU legislation and how they define where goods originate from:
- Goods wholly obtained in a single country are originating in this country.
- Goods whose production involved more than one country shall be deemed to originate in the country where they underwent their last, substantial, economically justified processing or working in an undertaking equipped for that purpose and resulting in the manufacture of a new product or representing an important stage of manufacture”.
The ‘Other products’ paragraph clearly leaves the door open for potential abuse. It gets extra chilly when you look at the ‘exception’ for the textile industry:
Generally, clothing is considered as originating in a country when one stage of transformation has been carried out there. A ‘stage of transformation’ depends of the type of clothing involved.
It doesn’t take a genius to understand that in a globalized world, one could be easily tempted to have goods processed in cheap labor countries and then import the nearly-finished product in the ‘Made in’ country of choice to complete the final steps of transformation.
Let’s have a ‘quick’ look at the different interpretations of a few of the top 10 countries.
- “Made in Germany”Those services and components which are crucial to the quality and valuation of the goods must have been performed or manufactured in Germany;
- Parts or components of an industrial product may be supplied from abroad, but the essential parts of the final product must always originate in Germany. A significant refinement may justify the description “Made in Germany”.
- “Made in Italy” May be a product either completely made in Italy or made partly in Italy and partly abroad. This is the case when the last substantial processing took place in Italy.
- “100% Made in Italy”This is an additional label that was introduced in 2009 as we suppose even the legislators noticed how “Made in Italy” has turned into 100% BS;
- The product or merchandise “whose design, engineering, processing and packaging are completed exclusively on the Italian territory “.
- “Vera Pelle Italiana”This label means nothing other than leather (raw material) originating from Italy. Vera Pelle Italiana is often found on mass produced leather items not made in Italy but in the P.R.C. This label remains highly contested in Italy as it is abused in many cases to make something seem as if Made in Italy when it really isn’t, which is of course no fun for the actual ‘Made in Italy’ businesses out there.
- “Swiss Made”Well we couldn’t leave this one out. 60% of the manufacturing costs and the essential manufacturing step must occur in Switzerland.
As you can see, where something is really ‘made’ depends mostly on whom you ask the question and how exactly it is written on the label (that is, if the labels are correct in the first place, of course).
The true meaning of the ‘Made in’ labels is by now so diluted it has become meaningless. That said – all our leather straps are Handcrafted in Belgium (100%), so there you go 😉
By the way, if you read all the way until here, this means you’re awesome and perhaps interested in this subject. Have a look at this magnificent article and research by The Guardian – here – to see what the value of ‘Made in’ labels really is in the luxury industry.