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In a candid and illuminating conversation, Bayard Winthrop, the founder and CEO of American Giant, an apparel maker based in California, shared his journey in the consumer product manufacturing sector. This discussion, which has been edited for brevity and clarity, reveals Winthrop's deep-seated commitment to reviving American manufacturing.

Throughout his career, Winthrop has managed various small consumer product businesses. Early in his entrepreneurial path, he embraced the principles of the Chicago School of economicsa libertarian viewpoint that values all forms of trade. At the time, he believed that shifting manufacturing overseas was a financially savvy move, so he followed that philosophy without hesitation.

However, as time passed, an unsettling realization took hold: he felt increasingly disconnected from the products he was selling. This emotional disconnection became a source of frustration for him. He recounted how, during his business's growth, he often had to make the difficult decision to cut labor costs to save a few cents on parts, which ultimately affected the very people who helped him establish his business.

The pivotal moment came in 2010 when Winthrop welcomed his first daughter into the world. This life-changing event sparked a desire to forge a different path, leading him to establish American Gianta venture that embodied his ideals and aspirations.

Reflecting on his upbringing in the 1970s and 1980s, Winthrop recalled the significance of American clothing brands such as Levi's, Wrangler, Champion, Red Wing, and Woolrich. These brands represented not just high-quality products but also a sense of identity and pride for their wearers. Yet, by 2010, he noticed a stark absence of such brands, as most of them had relocated their manufacturing overseas.

In a bold move, he launched the company with a focus on a men's sweatshirt, driven by his personal interest in that category. Soon after, a prominent article titled it the greatest hoodie ever made, which resulted in an overwhelming consumer response that pushed American Giant into back-order status for nearly three years. This early success reinforced Winthrop's belief in the existing consumer demand for quality American-made products.

Winthrop's insights extend beyond his experiences at American Giant. He highlighted the troubling reality that many Americans, particularly those in rural or less affluent urban areas, have faced economic hardships over the past four decades. He articulated a growing concern about the divide between well-educated individuals living in thriving urban environments and those struggling without access to financial markets.

Winthrop views American Giant as his contribution to addressing these disparities through a business model that focuses on creating well-paying jobs and high-quality products. He pointed out that the U.S. once had a robust textile industry, with a staggering 95% of clothing purchased by Americans made domestically in 1970. Today, that figure has plummeted to below 5%, highlighting a significant decline in domestic manufacturing capacity.

He elaborated on the fragmented nature of the current textile supply chain, noting that various stages of production, such as yarning, dyeing, and finishing, are often spread across multiple locations. This disaggregation complicates domestic production and raises costs. In contrast, countries like China can rapidly fulfill large orders due to their consolidated manufacturing capabilities.

Winthrop emphasized that while it's challenging and more expensive to produce domestically, the resulting quality is often superior because of the closer relationship to the source of the materials. He acknowledged that the journey is not easy, but it is rewarding in terms of the products being offered.

During the COVID-19 pandemic, American Giant demonstrated its adaptability by pivoting from clothing production to manufacturing face masks. This shift illustrated the company's commitment to meeting urgent needs while sustaining its operations.

Winthrop is optimistic about the potential for high-quality knitwear production in the U.S., asserting that many companies have simply forgotten how to produce it at scale. He criticized existing trade agreements, arguing that many are unfavorable, especially those involving China. He believes that the U.S. needs a fundamental reassessment of its trade policies, suggesting that recent tariffs imposed by former President Donald Trump have facilitated a much-needed dialogue about trade relationships.

While Winthrop acknowledges the complexities of the current trade landscape, he also raises concerns about the unpredictable nature of negotiations and their impact on private businesses. He cautioned that instability in trade policy can freeze capital investment and inhibit growth.

He pointed out that the U.S. remains a net exporter of cotton and has ample yarn production capacity. However, he noted the challenges faced in the sewing sector, which relies heavily on manual labor. Winthrop expressed hope that as demand for U.S.-made products increases, more individuals will seek employment in manufacturing, offering them a stable career path compared to fast-food jobs.

Winthrop concluded by addressing the necessity of rebalancing trade. He emphasized that while consumers might have to pay slightly more for products, the benefits of better wages for workers in places like Middlesex, North Carolina, could be worth the trade-off. His vision sees a shift towards higher-quality products made closer to home, fostering viable employment opportunities for those in need.