PETALUMA -- With 95 percent of the world’s consumers outside the U.S. -- and with Sonoma County exports up 14 percent in 2012 -- more firms are looking to enhance their export potential.
To help them get started, a half-day “Export University” was held May 9 in Petaluma for 85 attendees.
The Sonoma County Economic Development Board (EDB) and the North Bay office of U. S. Commercial Service (USCS), a division of the U.S. Department of Commerce, sponsored the event, along with the Sonoma County Board of Supervisors and 18 other co-sponsors.
[caption id="attachment_73818" align="alignright" width="196"] Ben Stone[/caption]
Ben Stone, EDB executive director, said, “These experts have tools to help local businesses enter or expand global markets.”
According to county Supervisor David Rabbitt, “Sonoma County has a strong brand and small businesses account for most local jobs. Programs like this enable them to develop export strategies leading to more sales and jobs.”
Export University is a branded USCS program covering topics such as global marketing and U.S. Government trade resources, finance and worldwide logistics.
“North Bay Exports are a gold mine,” said Elizabeth Krauth, director of the North Bay USCS office. “We can help you achieve global penetration.”
[caption id="attachment_73819" align="alignright" width="196"] Elizabeth Krauth[/caption]
“While most larger firms have learned how to take advantage of foreign markets, smaller firms can do the same.”
Erik Andersen, head of global sales for Remedy Interactive, said export marketing begins with an executive commitment to sacrifice short-term profits to increase overseas travel and administrative budgets.
He said firms need people focusing on global business, conducting research, developing multilingual marketing materials, complying with international standards and obtaining export licenses and permits.
[caption id="attachment_73820" align="alignleft" width="245"] Erik Anderson[/caption]
“Companies must establish credibility overseas, differentiate and promote their products in target markets and identify, select, manage and motivate foreign distribution networks.”
Tapping foreign visitors at U.S. trade shows, exhibiting at foreign shows and networking through international trade associations are ways to begin.
“Think about your product from a solution perspective, and educate foreign buyers on its benefits to them. What problems does it solve? Is it better/different from what can be obtained elsewhere? Is the cost of ownership lower? What is the value proposition compared to price? Where can people buy it?”
He said, “Leverage your website. Make it easy for foreign customers to find your partners through web links, or localize your presence by using country-specific web domains.”
[caption id="attachment_73821" align="alignleft" width="158"] Daniel Giavina[/caption]
Daniel Giavina, an international trade specialist with USCS, said, “Every $1 billion in U.S. exports supports 5,500 jobs at home.”
With offices in 74 countries and 100 U.S. cities, this agency can assist North Bay firms in locating international buyers and distributors.
Through www.export.gov, companies can obtain free foreign market overviews, lists of competitors and international trade shows. This site provides access to import regulations, documentation requirements and distribution channel information. For a fee, USCS can conduct customized market research.
The agency’s Gold Key Service, also offered for a fee, arranges meetings for U.S. companies with prospective foreign partners, holds post-meeting debriefings, provides logistical support and referrals to qualified interpreters.
The California STEP program (californiastep.org), working with an SBA grant, enables U.S. firms to participate in select foreign trade shows at reduced rates.
[caption id="attachment_73822" align="alignright" width="180"] Robina Peanh[/caption]
Robina Peanh, regional insurance manager with Meridian Finance Group, discussed trade finance options, working capital loans for international trade and mechanisms for getting paid.
She discussed the need for export credit insurance to facilitate open account sales, and U.S. government finance programs through EX-IM Bank and SBA.
“Once you find a foreign buyer, what’s next? Will the terms be cash in advance, by letter of credit, documentary collection or through open account? For given exports, methods vary.”
Export credit insurance can be purchased through a specialty broker, such as Meridian, that tailors coverage as high as 95 percent (through EX-IM Bank) to an exporter’s needs.
Both EX-IM Bank and SBA provide working capital guarantees so banks can offer more favorable financing terms to exporters.
[caption id="attachment_73824" align="alignright" width="158"] Todd Acker[/caption]
Todd Acker, regional sales manager for FedEx Services International, described issues associated with shipping goods overseas.
While FedEx, UPS and DHL are the three major international integrators, with their own aircraft and overseas pickup and delivery systems, the number of freight forwarders is unlimited.
“To avoid mistakes, it’s important for exporters to be familiar with Incoterms, documentation rules as well as packaging, labeling, foreign customs regulations and return processes.”
Care must be taken when determining shipping costs and preparing quotations, while avoiding over-packaging. Companies should learn how to properly complete bill of lading and airway bills.
He said failure to adequately describe shipment contents is the primary cause for delays, leaving the door open for customs agents to assign higher duty fees.
Export documentation has to state what the product is (not just “parts” but printing press parts, for example), what its made of, where its made, who is receiving it, how it will be used, the number of items being shipped and the value per piece.
“U.S. firms need to understand the importance and types of logistics partners, along with commodity classifications and freight insurance based on declared value in the event of physical loss,” Mr. Acker said.
Export University PowerPoint presentations are posted on the economic development board’s website (sonomaedb.org).
