Two years ago, Walmart announced with much fanfare its plan to buy and sell more American-made products. In a 2013 Huffington Post blog post, then Walmart President and CEO Bill Simon framed the initiative as part of a noble effort to bring manufacturing back to the United States:
Walmart has pledged to buy an additional $50 billion in American-made products over the next 10 years… We understand there will be questions about Walmart's participation in this effort, fueled by the myth that our shelves are filled with foreign products. In fact, according to data from our suppliers, items that are made here, sourced here, or grown here account for about two-thirds of what we spend to buy products at Walmart U.S.
Walmart SVP Michelle Gloeckler described the move as, among other things, a patriotic duty. She said in an interview conducted that year, "Growing the economy and creating jobs are at the heart of our national political conversation today. It will take all of us doing our part—business, government, labor, nonprofits and private citizens. The retail industry must help lead, and we need to start now."
The effort has since expanded. Greg Foran, the company's current president and CEO, said in July that "we are pushing hard toward our $250 billion goal to source more products made, assembled, or grown here."
But the blustery campaign had hit a snag back in June, when the watchdog group Truth in Advertising (TINA) called the company out for mislabeling products. TINA identified several products listed on the store's website marked with Walmart's "Made in the USA" label that, according to the product packaging or manufacturers' websites, were produced elsewhere.
The group also found products marked with the label that don't meet Walmart's own standards.
TINA said it sent Walmart executives a letter alerting them to the labeling issues, and received a reply explaining that "we have reviewed the listings identified in your letter and are taking steps to ensure that this information is corrected as necessary…we also are undertaking a more extensive quality assurance review to eliminate these kinds of coding errors in the future."
A spokesperson for the company told CBS News at the time that the problematic labels were a result of coding errors. CBS explained, "the problem arose because some items that had been manufactured in foreign countries are now being made in the U.S., but not all of the labeling had been updated, the company said."
TINA, unsatisfied by whatever efforts Walmart made to remedy the situation, submitted a complaint to the FTC this July, which started an investigation into the company. Since then, Walmart appears to have quietly changed or removed the labeling on some of its labels.
That earned the retailer a tacit—if finger-waggy—nod of approval from the commission, which said on Tuesday that it is dropping the probe. In a letter written to Walmart attorney Annemarie O'Shea, FTC staff attorney Julia Solomon Ensor listed all of the efforts WalMart has so far made to avoid mislabeling products:
Walmart took several steps to prevent consumer deception. With regard to its website, Walmart: (1) removed "Made in USA" logos from all product listings; (2) removed country-of-origin information from all product specifications, except where required by law; (3) removed U.S.-origin claims that appeared in product descriptions or titles; and (4) implemented a procedure to flag and remove new U.S.-origin claims made in ad copy submitted by suppliers. Additionally, Walmart rolled out redesigned "Made in USA" logos for private brand products promoted in conjunction with the Investing in American Jobs Program. The redesigned logos, which appear on product packaging, include larger disclosures regarding the percentage of U.S. content contained in the product, as well as a disclosure intended to convey that the U.S.-origin claim is self-certified by the supplying factory.
Ensor concluded, "based on your actions and other factors, the staff has decided not to pursue this investigation any further. This action should not be construed as a determination that there was no violation of Section 5 of the Federal Trade Commission Act, 15 U.S.C. § 45," which determines "unfair or deceptive acts or practices."
A Walmart rep told me that the company is "pleased with the FTC’s decision and appreciate its thorough review of our program."
Danielle Wiener-Bronner is a news reporter.