Ask owners of small and midsized companies what scares them most about expanding their sales or business operations into foreign countries, and the answer is predictable.
“Risk,” says Ed Dieter, deputy director of the Minnesota Trade Office (MTO), the state’s official export promotion agency, ticking off the top reason small companies with great potential shy away from exporting. “They worry they won’t get paid, that it’s too easy to lose their shirts. They’ll say, ’Look, I get stiffed often enough at home. Why would I take that chance overseas, where there’s nothing I can do about it?’”
Money and Expert Advice
Let’s start with expertise and capital. The MTO has a team of business consultants specialized in international trade.They provide market, industry and technical expertise; offer export courses and workshops; and bring delegations on trade missions and to international trade shows. Services are provided without charge or at a nominal fee.
To help defray the cost of exploring foreign market opportunities, the MTO and the U.S. Small Business Administration have teamed up to offer export assistance grants (called STEP Grants) of up to $7,500 for a wide range of export-development activities, including trade missions, trade shows, product testing and certification.
The U.S. Commercial Service has consultants in more than 100 U.S. cities and more than 75 countries to help U.S. companies start and expand their sales in foreign markets. And the Export-Import Bank of the United States and the SBA have a variety of finance programs ranging from working capital and loan guarantees to credit insurance.
Reducing the Risks
While calculated financial risk is a part of any business, those concerns can make companies reluctant to invest in facilities, equipment, and personnel in other countries, especially in developing markets, which can present a variety of political risks beyond an investor’s control, says Larry Spinelli of the Overseas Private Investment Corporation, a U.S. government agency that helps U.S. companies do business in more than 150 countries worldwide.
OPIC’s financing programs and political risk insurance can insulate companies against losses due to war, civil instability, and terrorism. But it also protects against government actions that ill-affect your company, such as interference in your contracts, taking your property, or refusing to let you take profits out of the country.
“If something happens, we’ll pay you, make you whole, and we’ll step into your shoes,” says Spinelli.
Learn More at Upcoming Seminars
Company executives who want more to learn about export and trade resouces will have two excellent opportunities in early October.
OPIC will hold its Expanding Horizons Workshop in on Tuesday, Oct. 8., at the Radisson Plaza Hotel in Minneapolis. Participants will learn how to:
Speakers include senior government officials from OPIC, the MTO, the Small Business Administration, the Export-Import Bank of the U.S., the U.S. Trade and Development Agency, the U.S. Department of Commerce, including the U.S. Commercial Service and the Minority Business Development Agency.
Register for the OPIC seminar online. For more information call (202) 336-8690.
Also on Tuesday, October 8, the Eden Prairie Chamber of Commerce and the TwinWest Chamber of Commerce are sponsoring an Export-Trade Summit from 7:30 to 10:30 a.m. at the Hilton Garden Inn, 6330 Point Chase, Eden Prairie.
The program touches on the benefits of exporting and what businesses need to know to take advantage of foreign opportunities. Kathleen Motzenbecker, executive director of the Minnesota Trade Office; Mathew Woodlee, senior trade specialist with the U.S. Commercial Service-International Trade Administration in Minneapolis; and Congressman Erik Paulsen will speak.
Register for the Export-Trade Summit online. For more information call (952)-944-2830.