AS YOUR BUSINESS expands its sales to other countries, the U.S. Department of Commerce may be your best collaborator. The department offers small- and medium-size companies assistance in exporting.
The department emphasizes products rather than services and focuses on making infrequent exporters into frequent shippers. The government estimates 86,600 U.S. companies export occasionally.
Don't think your company has to be a giant to get in on the action. According to The Exporter magazine, 70.9 percent of U.S. exports consist of shipments that average only $40,400 each.
Trade specialists: The Baltimore district office of the Commerce Department serves all of Maryland as well as the District of Columbia. Call (301) 962-3560 to speak to one of three trade specialists. If you are completely new to exporting, the specialist will make a gut decision during the phone call or at your first meeting as to the strength of your business skills. If your skills are weak or if you are new to international trade, you probably will be referred to the Small Business Development Center for a few hours of free business consulting. The center is U.S. Small Business Administration program to help small companies grow.
The trade specialist will work with you to determine the best foreign markets for your product. The department has a computer information management system that shows which countries out of the 173 in the system were the top 10 importers of your type of product. The trade specialist will contact an industry specialist in Washington to obtain additional information about your industry such as export regulations to observe.
You must do some homework and make a marketing decision as to which country or countries will be your export target. The trade specialist then contacts a country specialist in Washington to obtain more information on the political risk, the local economy, tariffs and applicable procedural information. All of this is critical to your final business decisions.
Market study: Will your product sell in a foreign nation? One way to get a sense for this is to ask the department's Comparison Shopping Service to analyze your potential for success. The fee, which varies by country and product, ranges from $500 to $1,500 for the research. The researchers talk to foreign importers, retailers, distributors and others in order to create a customized report within 45 days.
Making contacts: Once your business plan to export is complete, you may be able to use additional department services to help you make contacts. To find foreign agents, distributors, retailers, partners, banks, etc., spend $125 on the Agent/Distributor Service. This is a special report to provide you with limited information on three companies that the department's foreign-based staff member thinks will be helpful to you. For an additional $10 to $500, you can use the Export Contact List Service to obtain the names and addresses of all of the foreign firms in your target country that are in the department's information system. This list can be useful for marketing purposes. Once you have identified a company with which you want to establish a relationship, order the World Traders Data Report for $100 for each business investigated.
The Trade Opportunities Program is a computer bulletin board service. Your computer can interact with the department's computer to produce a list of foreign companies that are actively searching for specific American goods, hopefully yours. It costs $25 plus the "on-line" computer charges. The computer will produce a report that lists direct sales requests, project bids and joint venture opportunities.
Promotion: There are a number of other services available to promote your products. The most visible are the Trade Mission and the Matchmaker programs. Trade missions allow someone from your company to visit a foreign country with a group of other business people and representatives of state and federal government. The missions are carefully planned to "open doors to host-country government and business leaders who otherwise would be difficult to contact," according to David E. Earle, director of the department's district office in Baltimore. Appointments are set with local contacts and interpreter services are available. These missions are frequently subsidized by the government, so your costs may vary from $1,000 to $5,000.
The Matchmaker Program is similar to the high-profile trade missions. The department targets a country and organizes TC group of U.S. companies to visit the foreign country together. The participants benefit from the group travel rate, but much of the planning and background information for the trip is up to you to organize. The department's staff person in the U.S. embassy will schedule your appointments and will screen your foreign sales prospects. The cost is approximately $1,500 plus airfare and hotel.
The bottom line: Make the Commerce Department first on your list of contacts when your company considers expansion to foreign markets.
Patrick Rossello, president of The Business Consulting Group, is a member of a number of local advisory boards, including the College of Notre Dame. Send questions or suggested topics to him c/o Money at Work, The Evening Sun, 501 N. Calvert St., Baltimore, Md. 21278.