Archive for the ‘Export Assistance’ Category

h1

Richmond Export Assistance Center and Partners Bring ExporTech to Norfolk, Virginia

February 11, 2016

This post contains external links. Please review our external linking policy.

This is a guest blog by Sandra Choi, Development Analyst for foreign investment and international research at the City of Norfolk Department of Development

Last month, five companies from Norfolk, Virginia and surrounding municipalities completed ExporTech, a national export technical assistance program that helps local manufacturers develop and implement an international strategy to boost export sales. The program is jointly offered by the National Institute of Standards and Technology Manufacturing Extension Partnership and the U.S. Export Assistance Centers of the United States Department of Commerce. ExporTech applies a structured export strategy development process that assists companies in accelerating their growth.

ExportTech

Since 2007, 141 ExporTech programs have been delivered in 31 states with more than 745 participating companies.

 

Over the course of 12 weeks, senior executives from each company participated in a series of customized workshops to develop a written export plan. At the final session, their export strategies were vetted by a panel of trade professionals, including trade specialists from the International Trade Administration. After completing the program, companies will begin the implementation of their strategy alongside a robust network of partner organizations that contributed to the successful conclusion of the Commonwealth’s first ExporTech program.

Virginia’s first class of ExporTech graduates includes technology manufacturers, Descal-A-Matic, Grandwatt Electric, Mission Mobility, Netarus and Paramount Sleep. The participating companies represented the diverse manufacturing community of Norfolk and the Hampton Roads region. They ranged from start-up firms like Netarus, a manufacturer of wireless video sensor technology, to Paramount Sleep, a third generation family-owned luxury mattress manufacturer with deep roots in Norfolk. The class also included companies such as Descal-A-Matic, a green non-chemical water treatment technology company, and Grandwatt Electric, a portable light tower and diesel & gas powered generator manufacturer. Both companies have a history of international sales but wanted to develop a refined targeted plan for export growth. As a defense contractor, Mission:Mobility, a manufacturer of ‘at the edge of the network’ mobile communications equipment, wanted to target new markets as part of their strategy to diversify revenue streams.

Effectively aligning and coordinating the individual programs of federal and local organizations within the Commonwealth was crucial to the success of this pilot program in Norfolk. Through the integration of all the export-related services offered by the partner organizations and functioning as a single team, ExporTech was able to provide a holistic export roadmap for the participating companies. The U.S. Export Assistance Center (USEAC) in Richmond was a key partner to the City of Norfolk and GENEDGE Alliance, in the development and implementation of this program. The USEAC counseled companies on the fundamentals of exporting and worked with them to develop their plans. Through its global network, the Richmond USEAC is currently working to connect each company to potential overseas partners through the International Trade Administration’s Gold Key Service and other on-the-ground support in target markets. Other ExporTech partner organizations include Virginia Small Business Development Council, Old Dominion University and the Port of Virginia. Additional sponsorship was provided by FedEx Corporation and Fulton Bank.

Norfolk is setting a foundation to build a trade ecosystem that allows local firms to participate in an export-intensive economy. Central to this new economic development model is to introduce new resources that support the growth and expansion of small- and medium-sized firms. In addition to organizing technical assistance programs such as ExporTech, Norfolk introduced another key resource for exporting firms: access to capital. The Global Initiatives Fund, one of four new NorfolkFirst investment programs, will provide patient flexible capital for businesses that are looking to begin or expand their export activities. Both manufacturers and service exporters are eligible for the Global Initiatives Fund. Initially capitalized at $250,000, local firms can access the loan fund to finance a broad range of activities; participate in trade missions, connect with prospective buyers or support working capital needs. The Global Initiatives Fund is the first of its kind in Virginia and the United States. No other municipality offers direct access to capital for its trade community.

As it continues to assist the first ExporTech cohort with the implementation of their plans, the network of ExporTech organizational partners will kick off regional recruitment efforts for the second class of Virginia’s ExporTech participants in March. With trade growth becoming an important cornerstone of economic development strategies for metropolitan economies across the nation, programs like ExporTech play a crucial role in bridging the resources of the private-public sector and different levels of government to assist local companies seeking export assistance.

Since 2007, 141 ExporTech programs have been delivered in 31 states with more than 745 participating companies. Based on its recent success in Norfolk, companies in this area will continue to have the opportunity to benefit from this program.

 

h1

New ITA Report Highlights Jobs Supported by Product & Industry Exports

December 11, 2015

Chris Rasmussen, a Senior International Economist in the Office of Trade and Economic Analysis, is the Team Lead for Quantitative Analysis and the author of several publications on jobs supported by exports.

The International Trade Administration has released a report detailing the jobs supported by exports by specific product and also within individual industries. This report joins earlier work estimating total U.S. jobs supported by exports, jobs supported by state goods exports, and jobs supported by exports by destination.

When thinking about the relationship between exports and jobs the natural tendency is to focus on the workers employed in the industry that produces the final product that is exported. For example, a statistic for U.S. exports of chemical products may conjure up images of workers employed in chemical plants wearing hardhats and other protective gear.

However, products are not produced in isolation from beginning to end in a single industry, with the production of any product generally requiring the use of inputs from other industries. As a result of these interrelationships between industries in the production process, the export of a product will impact employment in multiple industries in addition to the industry that produced the export.

In the chemical products example, the production and export of those products will not only affect employment in the chemical industry, but also employment in industries such as petroleum and coal products, transportation, and other services whose products are used by the chemical industry.

By the same token, production and employment in the chemical industry will be impacted not only by the export of chemical products, but also by the export of agricultural products and products made of plastic and rubber that use products from the chemical industry as inputs in their production.

This report uses data capturing these interrelationships to look at the impact of exports on employment throughout the supply chain. This report finds that as a group, manufacturing industries have the highest share, 27 percent, of their employment supported by exports. The report further finds that although 60 percent of all export-supported jobs are supported by the export of goods, 67 percent of all export-supported jobs are jobs located within service industries.

In fact, the report indicates that for every job within manufacturing industries supported by the export of manufactured products there is an additional job supported in service industries by the export of those manufactured products.

Visit our website to learn more about jobs supported by exports.

 

 

h1

Five Things Entrepreneurs Should Know About Export Controls

December 2, 2015

This post originally appeared on the Department of Commerce blog.

The U.S. Commercial Service is having a Export Control Seminar in Salt Lake City, Utah on December 10, 2015. Learn more and register today.

A few weeks ago, Secretary of Commerce Penny Pritzker addressed more than 1100 industry representatives during the Bureau of Industry and Security’s (BIS) annual conference to discuss export control policies and highlight how, BIS has an enormous impact on the nation’s safety and competitiveness.

Secretary of Commerce

Secretary of Commerce Penny Pritzker Addresses the 2015 BIS Annual Update Conference

As National Entrepreneurship Month comes to an end, we will continue to celebrate American innovation. Entrepreneurs launching new businesses or looking to export can look to BIS as a resource and learn how export control laws may be relevant to their operations.

Export controls help protect U.S. national security and foreign policy, and address proliferation concerns. By administering and enforcing export controls, BIS seeks to keep some of the most sensitive goods and technologies out of the most dangerous hands.  BIS requires businesses to submit license applications for certain exports, and enforces the law against those who do not get required licenses. An export license grants permission to conduct a specified export transaction–to ship an item or to release software source code or technology. BIS then issues licenses after a careful review of the facts, and with input from other U.S. government agencies, including the State and Defense Departments.

The key issues involved in the review of a license, or whether a license is required include: What you are exporting, how the item will be used, as well as where and who the ultimate recipient will be. Although many items are not affected by export controls, high technology items and items destined for sanctioned countries, persons, or entities will often require a license from BIS; this includes commercial as well as some military items.

Here are the top five things entrepreneurs should know about export controls:

  1. BIS offers services for understanding export controls.  BIS offers a variety of services to help you comply, including live seminars, an online training room, and regularly scheduled conference calls on export control regulatory changes and Cuba updates.  We also offer consultations with export counselors who are also available by phone at (202) 482–4811, or (949) 660–0144 for our West Coast office.
  2. Export controls affect high tech industries, including items for commercial as well as military use. There is a misconception that export controls only affect military use items.  Export controls also apply to sensitive or high technology commercial items. Examples include high-end machine tools and semiconductors, encryption software, night vision camera equipment, and technology for unmanned aerial systems.  These and other items may require a license prior to shipment or transmission out of the United States.
  3. Exports to certain countries may be uniquely affected by export controls. Sanctions and other regulations can impose special restrictions that affect the export of many items—including “low tech” items in some cases—to particular destinations. BIS has a role in administering economic sanctions on countries such as Cuba, Russia, and Iran, among others. Exports destined for sanctioned countries will often require a license before they are exported, even if the items are not high tech.
  4. Export controls may affect companies and research institutions who employ foreign nationals or who collaborate with foreign nationals on research, even within the United States.  A “deemed export” is the release of technology or source code to a foreign national in the United States.  This is because our export control regulations treat such a release of controlled technology as an export to the individual’s home country.  Therefore, a license may be required before you release controlled technology to a foreign national who does not hold a U.S. green card.
  5. There are exceptions.  Even if your export would otherwise require a license under our regulations, it may qualify for a “license exception.”  A license exception is an authorization that may allow you to export or reexport, under stated conditions, some items that would otherwise require a license.  Four of our most common exceptions include allowing for replacement parts (License Exception RPL), shipments to certain government end-users (GOV), temporary exports (such as for exhibition, for tools of trade, or for repairs abroad) (TMP), and limited value shipments (LVS).  In addition, in 2011, BIS added a new license exception called Strategic Trade Authorization (STA).  STA facilitates trade with a list of 36 allied countries, and includes deemed exports to nationals of such countries.

For more information, please visit the BIS website at www.bis.doc.gov or follow us on Twitter @BISgov.

h1

The Great Mall of China

November 30, 2015

This is a guest blog by Doug Barry PhD, who until recently was a Senior International Trade Specialist with ITA’s Office of Communications and Digital Initiatives  

Despite slowing growth and a welter of government regulations, there are still good opportunities to be had in the China market, says the 2015 edition of the China Country Commercial Guide (CCG). Published by the U.S. Commercial Service in China, the CCG, now available online in bite-size nuggets, points out that while many industries remain closed to foreign participants, you’re on much more enticing ground if you’re selling medical equipment, health supplements, baby and environmental products and services, and using e-commerce to avoid most taxes and certifications to reach Chinese consumers directly.

E-commerce is rapidly increasing in China, and in May 2015 accounted for around 10.6% of all retail sales. There are over 632 million Internet users in China, of whom 47% are online shoppers. That’s slightly less than the entire population of the United States.

“The Chinese market remains strong, the retail sector underdeveloped, and logistics surprisingly improved,” says Joshua Halpern, a Commercial Officer with the U.S. Embassy in Beijing. “That combination, along with an expanding middle class, government policies that drive domestic consumption, especially in the 2nd and 3rd-tier cities and a degradation of trust for domestic-made products presents U.S. exporters with unprecedented opportunities across a comparatively streamlined and low-cost export channel.”
E-commerce sales in China totaled $449 billion in 2014, up 49.3% from $300.7 billion in 2013, according to the Chinese government’s National Bureau of Statistics (CNBS). In comparison, web sales in the U.S. totaled almost $305 billion in 2014, up 15.4% from 2013, according to Department of Commerce estimates (February 2015). China’s  e-commerce market is growing more than three times faster than that of the United States. Although the official average income of the Chinese online shopper is much less than their American counterparts, personal income of the Chinese middle class grew by 10% (CNBS). The Chinese research firm iResearch forecasts that China’s e-Commerce market will grow at a 27% annual rate over the next four years.

Feet on the ground, or mail it in

U.S. Companies wanting to sell products via Chinese e-commerce platforms, including Alibaba and its affiliates Tao Bao, Tmall and Tmall International, can choose a more traditional approach by establishing a physical presence in China, or use cross-border e-commerce to sell the products directly from abroad. A presence in China can be a subsidiary company, a JV, a wholly-owned entity or a local distributor/agent. The CCG contains information on these different options for establishing a presence in China and the Department of Commerce offices across China can help you identify the right option for your business.

Within the massive growth of e-commerce in China is an approach called “bonded online shopping,” the cross border element of online shopping via government-approved websites that enables foreign brands to sell products overseas. In cross-border e-commerce, goods imported by means of bonded import will be exempt from certain import duties, consumption tax and value-added tax, and are only levied with Personal Postal Articles Tax. Cross-border e-Commerce is in a trial stage, and is likely to experience significant changes as regulations are put in place.

Also, since potential Chinese distributors comb through popular e-commerce marketplaces in search of new products, your product’s presence could lead to orders for containers, rather than oneseys and twoseys (small quantities), which still could be considerable given China’s population of 1.3 billion.

The latest CCG also contains information on the U.S. Government’s export assistance resources in China, which are most significant in the world. Good thing, too, because being successful at e-commerce in China often requires more than a passive listing or virtual store on one or more marketplaces.

Another trend to keep an eye out for is what Commercial Officer Joshua Halpern calls “C-commerce”, which is the shift in consumer behavior away from static one-directional e-commerce platform shopping toward content-rich sites and social media groups that discuss and recommend products and lifestyle activities they are passionate about. C-commerce allows Chinese consumers to trust recommendations from passionate friends in their “inner circle”. U.S. Commercial Services offices in China can advise you on developing a proper e-commerce strategy, including local service providers who can help market your product on China social media.

h1

How to Find Sector Opportunities in Korea

November 16, 2015

Jim Bledsoe is an International Trade Specialist with the U.S. Commercial Service in Little Rock, Arkansas

A business client named Max recently contacted me to ask some general exporting questions pertaining to a few specific markets. It soon occurred to me that a lot of what he was asking about was readily available in our agency’s Country Commercial Guides (CCG), which are posted online for free here. I asked Max if he had ever used a CCG or even heard of them, which led to the following conversation.

Max:  What is a CCG, and why do I, as a U.S. business, care?

Jim:  A CCG is a guide prepared by boots-on-the ground trade and economic professionals at U.S. Embassies and Consulates abroad that highlights specific country market conditions. While similar to the CIA World Fact book in concept, the nature of the CCGs is geared more towards giving you market insights so you can sell your product or service in that country.

Max:  I see. A lot of what I’ve found out there on the Internet hasn’t really helped me narrow down the field for potential markets to sell in. So these CCGs then are more useful—how so?

Jim:  There are currently CCGs covering 123 markets. These Guides have the latest on high-demand industry sectors, as well as market-by-market economic overviews, selling techniques, investment climate considerations, trade financing options, and business travel advice and resources. U.S. companies can also find opportunities not only in popular markets, but also in many other less crowded markets. In our earlier conversation, you had asked about the Korea market, so let’s take a closer look. We have a great group of trade professionals that I work with who write about specific areas like Agriculture, or the Defense Industry. Basically, you are getting current market conditions from people—U.S.  Federal Employees—who live and work in the respective markets of the CCG they write.

Max:  How do I use this CCG to get my Defense Industry in Korea-related market information?

Jim:  The easiest and most efficient way to capitalize on the valuable market information contained within the CCGs is to contact your local U.S. Export Assistance Center (USEAC). So right here by calling me, you are already doing it the easy way! But seriously, anyone can contact their local USEAC where an International Trade Specialist can help identify and winnow down potential markets, work with you to develop an export strategy, and help explore  options for business to business matchmaking

Max:  What if I just wanted to do some looking myself?  I would hate to bother you with this….

Jim: It is no bother at all—this is what I do and am happy to help!  However, if you wish to do further research into the markets yourself, it is easy. Here’s what I recommend:

  • First go to the CCG landing page and select which country you want find out more about. They are split up by region: Asia, Europe, Middle East & Africa, and Western Hemisphere.
  • Once you have clicked on a country, you will notice there are eight sections listed with topics you can click on in each of the following:
    • Doing Business in [Country]
    • Political and Economic Environment
    • Selling U.S. Products and Services
    • Leading Sectors for U.S. Exports and Investment
    • Trade Regulations, Customs, and Standards
    • Investment Climate Statement
    • Trade and Project Financing
    • Business Travel

Max:  What if I just want to find out about the Defense Industry in South Korea?  What all would I click on?

Jim:  Well, that depends. First click on the Korea link under the Asia region, then next under the “Leading Sectors for U.S. Exports and Investment” section. I would recommend clicking on the Defense Industry Equipment link. Under this link, you will get a comprehensive view of the Defense Industry market segment in South Korea, including best prospects and opportunities in the market. This section also includes major trade shows and key acquisition contacts for the Defense Industry in Korea. However, I wouldn’t recommend stopping at that link alone, especially for the Defense Industry. I would recommend looking at the “Doing Business in Korea” section, and reading through the overview sections where there is valuable information on how strong a trade partner Korea is with the United States. Then look at Market Opportunity and Challenges insights, as well as where you can find a general Market Entry Strategy specific to Korea.

Seeing as how the “Doing Business in Korea” Market Entry Strategy link explicitly recommends “a local presence is essential for success,” I would highly recommend that you look at the “Selling U.S. Products and Services” section. This explains the various aspects of actually selling in Korea, such as the Using an Agent to Sell US Products and Services or Establishing an Office , where you will find  how to establish the local presence recommended by our Commercial Specialists at the U.S. Embassy in Korea.

Max:  That sounds helpful, is that all I should look at then?

Jim:  Your company has had good success in selling quality U.S. goods to the Defense Industry worldwide. In pursuing opportunities in Korea, you should check out the “Trade Regulations, Customs, and Standards” section for Korea, where topics such as Import Requirements and Documentation and U.S. Export Controls, among others, are covered for the South Korean market.

h1

Market Research that Challenges Your Assumptions

November 10, 2015

This is a guest blog by Doug Barry PhD, who until recently was a Senior International Trade Specialist with ITA’s Office of Communications and Digital Initiatives  

This post contains external links. Please review our external linking policy.

You are in the renewable energy business in the United States, and receive a notice about an upcoming conference on the topic to be held in Brazil. You’re interested, and start thinking about next steps. However, after talking with some colleagues at the office, you are quickly reminded that Brazil is in an economic slump, its politics more volatile than usual. “Slump” and “volatile” are not samba to your ears, and you decide that this isn’t the year to expand to Brazil.

CCGs

Country Commercial Guides showcase market research intelligence for 120+ countries. 

You’ve made a mistake. There’s significant opportunity in the renewable energy market.

What should you have done to get an accurate understanding of the market, even if you decide not to go to a trade show for the industry?  Well, you should have consulted a resource that for many years has been providing reliable, in-depth market research for U.S. companies of all sizes. The publication is called the Country Commercial Guide (CCG) and there are Guides covering some 123 markets. Formerly comprised of large, door stop proportions, the CCGs from 2015 are divided into bite size bits and accessible online via export.gov/ccg/. In case we fail to mention it later, access is FREE. It’s never a good idea to select market opportunities based on faulty assumptions and hearsay.  With the CCG’s, you can get accurate, bankable information with an investment of a few minutes and a couple of mouse clicks. The format is mobile friendly, so you can peruse tidbits at your leisure, emailing yourself, or colleagues, to select pages for closer scrutiny later. Your boss may appreciate receiving this information for its brevity and insightfulness.

Size doesn’t matter

One of the first and most important things you notice is that despite a bumpy economy, caused in part by China’s falling demand for natural resources, Brazil is eager to build up its alternative energy capabilities. A drought in part of the country means that dependence on hydro power must be balanced with more solar and wind power. Businesses in the U.S. specializing in renewable energy should take note: Brazil isn’t your only best bet, and there’s opportunity in the most unlikely places—if you know where to look for it, like the Country Commercial Guide’s best prospect report on Renewable Energy.

A good place to look for buyers is trade shows, and Brazil has many, including in the energy sector. Trade shows inevitably provide a solution to one of businesses biggest challenges:  Where to find buyers—and these shows have a big collection of them under one large roof. Some of these shows will be attended by market and sector experts of the U.S. Commercial Service, based at the U.S. embassy and consulates. These folks know the buyers and will guide you to them, making sure reputations are impeccable and that they have the money and are ready to spend it. In turn the buyers may trust you more because the U.S. government is introducing you.

Here’s a sample of upcoming renewable energy shows in Brazil:

June 30-July 1, 2016, Rio de Janeiro, SP

Now that you’ve changed you mind about attending a trade show in Brazil, you wonder about temporary entry for samples or a popup table display. There’s a section in the CCG on temporary imports.

To your surprise, you learn that in this heavily taxed country, temporary imports are also taxed, but the amount is pro-rated based on the amount of time the goods are in the country. You can calculate the cost ahead of time. You learn that Brazil is examining the Carnet system, whereby participating countries agree not to tax temporary imports and a common document is used to expedite Customs processing. You make a note to check back in six months to see if Brazil has joined the Carnet system. If you make more frequent trips to Brazil, the Carnet, if adopted, will be useful.

Certain business protocols such as dress, perceptions of time, negotiation strategies, and trust are also covered in the CCG and can make the difference between making a sale and losing one. It’s not an overstatement to say that in no other publication, on or offline, can you find this mix of hard data and practical business acumen that you can apply immediately.

Oh, and did we mention that it’s FREE?

h1

Export Assistance Center Director Honored for Helping Utah Firms Succeed Internationally

October 7, 2015

Thomas McGinty is the International Trade Administration’s National Director for U.S. Operations.

What does the director of the Salt Lake City U.S. Export Assistance Center (USEAC) have in common with a former Utah governor and a former director general of the U.S. Commercial Service? They are all recipients of the annual Utah International Person of the Year Award.

Dave Fiscus accepts award

Director of the Salt Lake City U.S. Export Assistance Center, Dave Fiscus (2nd from right) accepts the Utah Person of the Year Award

I was thrilled to learn that Dave Fiscus, director of our Salt Lake City USEAC, recently received the 2015 Person of the Year Award for going beyond the call of duty to promote trade and help Utah companies succeed in international markets. The award was presented to Dave by KeyBank and the World Trade Association of Utah. This is a tremendous honor and professional achievement for him and the entire Commercial Service family. We challenge our employees to ‘Dare to Be Great’ in creating opportunities for U.S. businesses and promoting exports. I congratulate him for his outstanding work in Utah.

Terry Grant, president of KeyBank in Utah and member of the nominating committee, commended Dave for his deep engagement in the Utah business community, particularly his outreach to rural companies and the support he provides to state and World Trade Association events. This year, the governor led five trade missions and Dave played a major role in planning and executing each of them. Mr. Grant attended several of the missions and noted that the Gold Key meetings organized by Dave were extremely valuable in connecting Utah exporters with prospective overseas clients and partners.

Dave was also instrumental in recruiting 130 foreign buyers for the first time ever to attend this year’s Outdoor Retailer Summer Market trade show in Salt Lake City—100 more foreign buyers than the show organizer expected.

Director Fiscus in Salt Lake City and our international trade specialists in more than 100 other domestic Export Assistance Centers are helping U.S. firms succeed internationally by providing a range of services including:

  • Counseling on export mechanics and the development of an export strategy;
  • Market intelligence on best export prospects, market conditions, legal and cultural issues and more;
  • Matchmaking services to identify qualified foreign distributors and arrange meetings with these pre-screened contacts in the target market; and
  • Background reports on potential distributors, agents and partners.

To find an Export Assistance Center near you, visit Export.gov.