Posts Tagged ‘Baltimore’

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Celebrating International Trade in Maryland

June 3, 2014
John Malone of WTS International accepts an Export Achievement Award from Jolanta Coffey of the Export Assistance Center in Baltimore, Md.

John Malone of WTS International accepts an Export Achievement Award from Jolanta Coffey of the Export Assistance Center in Baltimore, Md.

Jack McCutcheon and Paul Matino Support Maryland Businesses at the Baltimore Export Assistance Center.

International exporting can seem daunting to many large and small businesses because they are unsure how to successfully take advantage of opportunities abroad.

Last week, at the 2nd Annual Celebration of International Trade, speakers provided veteran insight about the realities of doing business beyond the borders of the United States. The celebration was in honor of International Trade Month and brought together ambitious Maryland businesses for the chance to learn more about growing their companies.

The celebration provided information and discussions on international financial considerations, risk management, logistics, and legal concerns of international exporting. Dominick Murray, Secretary of the Maryland Department of Business & Economic Development, stressed the fact that currently less than 10 percent of Maryland companies participate in exporting.

Laura Lane, President of Global Public Affairs for UPS, noted that 95 percent of the world’s consumers live outside the U.S., and that optimizing international commerce through the establishment of modern and effective free-trade agreements will be critical for the continued strength of the U.S. economy.

Between the educational seminars, the annual award ceremony honored an exemplary exporter in the DC-Maryland region, John Malone, who is the General Counsel and Vice President of Compliance and Quality Assurance at WTS International. WTS was this year’s recipient of the U.S. Commercial Service’s Export Achievement Award, and also also was recognized by Sen. Barbara Mikulski’s office.

Maryland District Export Council Members Carl Livesay and Maryjane Norris were also presented with awards recognizing their contributions to business.

Many of the celebration’s speakers noted that succeeding in foreign markets can be easier than it seems. With the right information, proper planning, and assistance from the state, doing business abroad can be both a great contribution to the bottom line, and good reason to return for the 3rd Annual Celebration of International Trade next year.

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A Bolt from the Blue: A Small Company Grows as Exports Expand

May 17, 2012

Doug Barry is an International Trade Specialist in the Trade Information Center, part of the U.S. and Foreign Commercial Service

Stress Indicators is a Maryland manufacturing company with six employees.  Much of the raw materials for the product as well as the final bolt are made in the U.S. and sold worldwide.  This year, production is expected to increase from 25,000 per year to 75,000, with additional increases expected next year.  The company credits the U.S. Commercial Service of the International Trade Administration with providing help needed to go global. Company president Charles H Popenoe, III shared his story with Doug Barry of the Trade Information Center.

Barry:  How did you get into this business and how did this business start?

Popenoe:  My father, also named Charles Popenoe, worked for National Institute of Standards and Technology as a scientist. And in his spare time, as a hobby, he was an inventor.  He still is an inventor. And he invented the SmartBolt and patented it.

Barry:  How did he do it?  Did he invent the SmartBolt in his garage or his basement?

Popenoe:  Yes.  Garage and basement

Barry:  And he just tinkered around, and there it is?

Popenoe:  Well, he saw an article in Popular Science about a bolt with a little glass window that breaks when you tighten it to the proper tension.  And so he said, well, that’s neat, but I can come up with a better idea than that.  And he worked and worked and actually took 10 or 15 years to develop it.

Charles H Popenoe, III, President of Stress Indicators with SmartBolts, a product his father invented.

Charles H Popenoe, III, President of Stress Indicators with SmartBolts, a product his father invented. (Photo Stress Indicators)

Barry:  How are the bolts used and by whom? 

Popenoe:  The applications are numerous.  But we’ve had one in particular that’s caught on, and it’s really caught on worldwide.  It’s our most successful application.  It’s used for electrical connections.  And basically you’re joining conducting bars and they’re carrying current, and they’ve got to be tight, or else you get heat buildup and potential of arc and other issues.  It’s easy for inspection as well, because you can just look at the bolt and know that it’s properly tightened because of the color of the indicator in the head without touching these high-current-carrying bars.

Barry:  When did you start selling outside the United States?

Popenoe:  We were really just focusing on the U.S.  We got a few inquiries from overseas.  And one that we cultivated was with a Turkish company.  It was 2009 when we got our first big order from them.  And at that point, the people we were working with suggested that I talk to the Baltimore Export Assistance Center (of the Department of Commerce) to help us get started in our exporting program.

Barry:  And have there been sales to additional countries since the sales to Turkey?

Popenoe:  Yes.  Our sales to Turkey are ongoing, so we’ve been able to keep that customer happy.  But we’re also selling to Taiwan.  We have a new agreement with a company in Australia to sell throughout Southeast Asia.  We’re selling to South Africa, Japan, Korea, and the list goes on really. We have a good Internet presence and website, and we’re strong on search terms like “tension-indicating bolts,” “torque-indicating bolts.”  And we get a lot of interest from overseas from our website.  We develop these leads right here in (Maryland) usually by email and we don’t have to travel.  I’m actually going to Istanbul next month to visit my Turkish customer.  They’ve become a very important part of our business so it’s about time I visited them.

Barry:  What other kinds of help have you received from government?

Popenoe:  One of the outputs of our work with the Export Assistance Center was being able to create a business plan to submit to the state of Maryland for an Export Maryland grant, which helps pay for some of our international sales efforts.  And that actually led to a U.S. Department of Commerce trade mission to Brazil that we did the following year.  So it’s really been a series of services and they’ve all helped, really.

Barry:  And a written export plan obviously was helpful to you.  What are the main components of the plan?

Popenoe:  Well, it’s really identifying our market.  But I think one of the key things is the recognition that SmartBolts is an outstanding product for export – because it’s high value, its unique; it’s the kind of thing that can be used in almost any industrial nation.  And so the foundation of our plan is that we have a very good product for export and that we have to treat the international market very seriously if we want to grow.

Barry:  Intellectual Property Protection.  It took your dad 10 years to develop it so this would hard to reverse-engineer it in short order.

Popenoe:  It is patented.  And we have a series of patents, some internationally.  But mostly we’re protecting it based on the fact that we’re the only ones that know how to make it, and it’s not trivial to manufacture, and we’re trying to stay ahead of the competition.  But at the same time, we know that the challenge is there.  And then we have to keep developing new products to stay ahead of those who would copy it.

Barry:  What percentage of your business is international?

Popenoe:  Well, last year about 50 percent of our sales was international.  So it’s very significant.  It may even be greater than that this year.

Barry:  Good.  And what advice would you have to other U.S. companies that are considering expanding internationally or getting into it for the first time?

Popenoe:  Well, I think your local Export Assistance Center has a lot of resources to help companies determine whether they’re a good candidate for exporting.  And I think that’s where I would start, because that will point companies in the right direction to see where they should go from there. The networking opportunities are also great.  And so at this point we’re a fledgling exporter.  But, you know, in the future I certainly hope to be a model and assist others in the same path. 

Barry:  Export sales as 50 percent of total revenue hardly fits with “fledgling,” but I admire your understatement and your modesty. Are you publicly traded?

Popenoe:  No, that’s not likely.  We’re still a small company–but we’re growing.

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Baltimore’s Maritime Applied Physics Finds Success in South Korea

February 29, 2012

Doug Barry is an International Trade Specialist in the Trade Information Center, part of the U.S. and Foreign Commercial Service

Maritime Applied Physics is a small Baltimore-based engineering and manufacturing company.  Founded 25 years ago, the firm has been exporting for about 10 years.  Mark Rice is an owner of the company who was interviewed recently by Doug Barry of the Trade Information Center.

Barry:  What does your company produce and what markets have you sold to?

Rice:  We build marine components for ships as well as some advanced marine vehicles including unmanned boats.  Some of our exports have been large rudder systems and bridge controls in South Korea.  We’ve designed an America’s Cup hull for the Italians.  We’ve done some advanced battery work in France.  And we currently have a project in Scotland where we’re building a control system for a large piece of marine machinery.

Mark Rice, owner of Maritime Applied Physics of Baltimore, Maryland, speaks to Doug Barry about exporting and the challenges he faced.

Mark Rice, owner of Maritime Applied Physics of Baltimore, Maryland, speaks to Doug Barry about exporting and the challenges he faced.

Barry:  Less than two percent of all U.S. companies export.  What made you part of that less than two percent?

Rice:  Well, we were originally an accidental exporter.  We were contacted by a business agent from South Korea who found that we had done a project for the U.S. Navy that was very similar to one that was starting in South Korea.  And he called and asked us to come to South Korea to Hyundai Heavy Industries, the largest shipyard in the world.  And we decided to get on a plane and go, and ended up in a bidding war against a U.K. company that lasted about nine months.  And at the end of that process, we won the bid against a much larger company and began the adventure of exporting.

Barry:  What was the bid worth?

Rice:  The bid was $2.3 million, which was about equal to 50 percent of our revenue at that point, so it was a huge export in terms of percentage.

Barry:  You referred to yourself as an “accidental exporter.”  Many U.S. companies would classify themselves as such, and you discussed with your partners at the time whether to do it or not.  What was the mindset? 

Rice:  I think when we were first contacted we were intrigued, but probably had zero knowledge to base our decision on.  So as we went through the process, we stumbled through a bunch of things and made a lot of mistakes.  We almost violated the International Trafficking in Arms Regulations.  That was our first problem. As we went into the bidding, I guess we got drawn into it.  The competition took on a “we’ve-got-to-beat-these guys” sort of attitude.  And so we made actually three trips to South Korea during that process.  And in each case, the person who had originally contacted us gave us a little bit more of the South Korean culture, and we adapted.

Barry:  And what were the most challenging cultural things that you ran into and how did you overcome them?

Rice:  We were largely people who had not traveled internationally, so this was a whole new culture for us and a new experience.  And in South Korea, businesses perform very differently than in the United States.  Much to the chagrin of our business partner there, we made many mistakes as we went through this process, but found, as in most business relationships, a smile and a “thank you” and a “I’m sorry” every once in a while made up for all these things.  And so at the end of the day, it was our technical background that really won the project. 

Barry:  Was there a memorable cultural faux-pas?

Rice:  Probably the biggest mistake was in the bidding process. We were expected to start high and work our way down a significant amount.  And, you know, we were told in the first round of the bid: “give us your best price.”  And we did that, which gave us very little room to lower our price.  And that, according to our business partner, was an insult to the Korean company.  But in the end we won and our people grew immensely from the whole experience. 

Barry:  Intriguing that you mention the personal growth side of things.   How did going outside your comfort zone enhance the abilities of your team?
 
Rice: I think one of the things that we noticed right away in South Korea is our Korean counterpart engineers were very experienced in exporting.  They dealt with ship owners from all over the world.  So we were at a real disadvantage, engineer to engineer, in these relationships.  And I think that that comfort level with dealing on an international basis with another professional, exchanging information, what are the cultural norms and how do you build friendships and business relationships, was really what changed our people.  So we came away not as insular as they were when they left the United States.

Barry:  What was the key?  A different attitude?  New skills? 

Rice:  I think it’s removing the fear barrier.  It’s confidence and the ability to take on something that you’re not sure of.  It challenged us to get out of our established ways.

Barry:  How did the U.S. Commercial Service of the Commerce Department help you? 

Rice:  In a very significant way.  We came back from South Korea and our bank said, “This is too risky a deal.  We’re going to withdraw our credit lines from your company.”  So we had to go find a new bank.  And key to that was the Baltimore Export Assistance Center (of the Department of Commerce) introducing us to the Small Business Administration and ultimately getting a 90 percent loan guarantee on the project.  And that enabled us not only to do the job, but to survive that whole (economic) crisis. I’ve never seen an industry-government relationship that’s as helpful to a company as the one the Department of Commerce offers.  It’s remarkable.

Barry: So the moral of the story is don’t miss the boat on the way to the Korean shipyard.

Rice:  It’s don’t fear that world.  And if you’re only thinking of the United States as your market, you’re missing a huge opportunity.  Exporting may actually be a very necessary step that you take for your own survival as well as your growth.  Go forward and engage and use the U.S. government to help you.  And enjoy the great cultural experiences that will come with doing business.

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Bringing the Russian Market to America Part 2

May 3, 2011

John McCaslin is Minister Counselor for Commercial Affairs for the U.S. Foreign and Commercial Service in Moscow, Russia.

Leaving Cincinnati on a Sunday  I would start the toughest part of my journey, four cities in five days.  Arrived very late Sunday night in Baltimore via Minneapolis due to cancellation of the original direct flight.  The BRIC program started first thing Monday morning at a downtown hotel and featured an excellent keynote address by our Assistant Secretary for Trade Promotion, Suresh Kumar, followed by individual country plenary presentations on each of the four markets, and then concurrent breakout sessions on more specific aspects of doing business in these markets by successful US companies; a great program all in all, with over 100 business participants.

As noted earlier, these types of business outreach programs are put together by our outstanding domestic field and their local partners, in this case the Baltimore U.S. Export Assistance Center (USEAC) and the state of Maryland.  Again,  all I had to do was show up.  Baltimore is a great venue for these types of programs because of its proximity to Washington, which makes it easy to bring in senior U.S. Department of Commerce management, our Market Access and Compliance country desk officers and Commerical Service Regional Directors; quite a formidable array of U.S. government resources all brought together to support our US business clients in a very practical and informative format.

As usual, the local USEAC set up meetings for me at the hotel with individual local companies interested in the Russian market, so after my presentation to the larger group and before hopping on a plane for my next city, I met with two local firms.  One company, an experienced manufacturer and distributor of dental products with lots of international sales, was already established in Russia and was coming to me for advice on a problem with their exclusive Russian distributor.  This is a pretty typical case for many US firms that come our way and we always try to do our best to help them out.  The issue involved counterfeit products of the US company showing up in Russia, which was hurting legitimate sales.  Intellectual property rights (IPR) is a big issue in Russia and one in which we are well equipped to assist, since we have a U.S. Patent and Trademark Office Attache that sits in our FCS office in Moscow and a Russian IP attorney on staff.  I put the US firm in touch with our IPR staff in Moscow along with our Commercial Specialist who covers the medical sector, so they will be in good hands.

The second company was a well established manufacturer from Pennsylvania that sold duct work accessories into the HVAC sector in a number of foreign markets.  They have had some passive export sales to Russia, but really wanted to do much more.  I had a feeling we could really help this company so that day I put them in touch with our Moscow Commercial Specialist who covers this sector in order to start a dialogue and also looped in our Pittsburgh USEAC, which has worked with this company in the past.  Looking ahead to possible trade promotion opportunities, I let this firm know about a proposed energy efficiency trade mission to Russia later this year that the US Dept of Energy is planning with support from our agency.  This could be an interesting market entry vehicle for the company since the mission would be designed to bring Russian firms to the US and then take US firms to Russia in order consummate in-depth, long lasting business relationships.

Next stop Cleveland.

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