Here’s a startling statistic: According to the International Trade Administration (ITA), of the more than 30 million small businesses in the United States, less than one percent export to another country. Of the businesses that do export, 58 percent export to a single country – usually to either Canada or Mexico.
The ITA cites several reasons why U.S. businesses are reluctant to dip their toes in the export waters:
- Trouble obtaining necessary working capital
- Fears about receiving payments from foreign customers
- Difficulty navigating foreign customs and regulations
- Difficulty arranging meetings and networking with potential distributors
While these are viable concerns, the fact that less than one percent of U.S. businesses export is alarming, especially considering the U.S. economy continues to struggle. As U.S. businesses seek to regain their financial footing, now is the time to look to foreign markets as the source of new customers.
Businesses interested in exporting will find a plethora of government agencies and programs designed to help pave the way:
- National Export Initiative: As part of his goal of doubling U.S. exports by the end of 2014, President Barack Obama issued an Executive Order in March 2010 laying out the groundwork for a National Export Initiative (NEI). The purpose of the NEI is to remove trade barriers and help U.S. businesses enter new export markets by helping to remove obstacles, assisting with financing and serving as a liaison to facilitate meetings between U.S. businesses and foreign parties.
- Export.gov is a gateway to the trade promotion and export finance programs of the federal government. Administered by the International Trade Administration, the export.gov website, is a go-to source of information on key topics including:
- Export-Import Bank: The official export credit agency of the U.S. The Ex-Im Bank works with U.S. businesses – large and small – to identify potential global partners, and to secure funding necessary to enter the export market.
- Office of the U.S. Trade Representative: Agency charged with negotiating directly with foreign governments to develop trade agreements, resolve disputes and participate in global trade policy organizations. USTR officials also meet with governments, business groups and public interest groups around the world to promote U.S. trade relations.
- Foreign Agricultural Service (FAS): A department of the U.S. Department of Agriculture (USDA), FAS works to facilitate export opportunities for U.S. agriculture in the global marketplace.
- Small Business Administration: Independent agency of the federal government charged with assisting small businesses to start, grow and prosper. SBA’s International Trade division offers loan guaranty programs that enable the small business exporter to obtain working capital to finance shipment needs and finance acquisition of fixed assets.
- U.S. Export Assistance Center (USEAC): A network of export and business specialists located in more than 100 U.S. cities and over 80 countries worldwide. These trade professionals provide counseling and a variety of products and services to assist businesses in developing export programs.
- U.S. Trade and Development Agency (USTDA): Helps companies create jobs through the export of U.S. goods and service for priority development projects in emerging economies. Links U.S. businesses with export opportunities to support infrastructure and economic growth projects in partner countries.
This list is just a sampling of the export-facilitating services offered through the federal government. Businesses can also take advantage of international trade assistance offered by each state.
With 70 percent of the world’s purchasing power outside U.S. borders, why not consider expanding your customer base to a foreign market? Does your company currently have plans to expand? What markets are being considered? As the above discussion indicates, there are many government agencies willing to lend a helping hand.