Have you considered exporting, but you’re just not sure if it’s right for your company? Differences in currency, culture and language can make the idea of reaching foreign customers intimidating.
But consider this: 96 percent of consumers live outside the United States and two-thirds of the world’s purchasing power is in foreign countries, according to the U.S. Small Business Administration (SBA). Exporting can be one of the most effective ways to expand your markets and grow your business. It’s a fact many California businesses understand well: California companies set a new record for merchandise exports in 2013, according to a Beacon Economics analysis of foreign trade data released by the U.S. Commerce Department, and California currently accounts for 11 percent of total U.S. merchandise exports.
By learning more about what’s required and using the many resources available to you, you may be able to begin exporting with confidence.
7 tips to help you dive in
Are you ready to go global? Taking these seven steps can point you in the right direction.
1) Develop an international marketing plan with defined goals and strategies. The U.S. Commercial Service Market Research Library provides data that can help you put together a successful plan.
2) Assess your production capacity. You’ll need to be sure your company can meet the demand it is creating.
3) Secure the financial resources you’ll need to actively support marketing your products in your targeted overseas markets. The Export-Import Bank, Small Business Administration and Department of Agriculture all have programs that provide financial assistance to U.S. exporters.
4) Ensure company management is committed to deploying adequate staff, time and resources to develop export markets. Developing an export market takes time and effort, and management commitment is crucial.
5) Investigate how you may need to modify product packaging and ingredients to meet foreign import regulations and cultural preferences. Visit the Trade Information Center for information about regulations, export controls and specific industry and regional information.
6) Learn about shipping your product overseas. An international freight forwarder can help you learn about packing, labeling, documentation and insurance requirements.
7) Understand export payment mechanisms. Foreign sales and receivables are generally excluded from traditional lending programs, but the federal government offers guaranteed financing programs administered by the U.S. Small Business Administration (SBA) and the Export-Import Bank. The loan proceeds can be used to purchase supplies and equipment, hire staff or even attend an overseas trade show. The flexible terms allow the loan proceeds to be used to fulfill a large contract or several small deals. Learn more about Export-Import Bank products.
Helpful resources
The SBA’s Office of International Trade's mission is to enhance the ability of small businesses to compete in the global marketplace.
Contact a local trade specialist from export.gov for counseling and a variety of products and services to assist your businesses with exporting its products and services.
California Bank & Trust offers a set of international banking solutions that make it easier than ever to take advantage of exporting opportunities. Our International Banking Group — seasoned bankers with decades of experience — can help you hedge currency risk, secure your transactions with letters of credit and more.[cite::171::cite] [cite::172::cite]