COVER STORYSTEP: Export Assistance for Small BusinessesThe STEP program provides financial and technical assistance to qualifying<strong>Minnesota</strong> small businesses with an active interest in exporting productsor services to foreign markets. Participants may be first-time exporters orcompanies that currently are exporting but are interested in expanding intonew international markets.FINANCIAL ASSISTANCE AVAILABLESmall businesses may apply for reimbursement of up to $5,000 for approvedexport-development activities, including:• Participation in trade missions.• Exhibiting at trade shows or industry-specific events.• Translation of marketing materials.• Development of foreign language Web sites.• Gold Key or other business matchmaking services.• Company-specific international sales activities.• Testing and certification (such as CE marking) required to sell products inforeign markets.ELIGIBILITYEligible companies must fit the SBA definition of a small business, based onannual sales or number of employees, and:• Have been in operation for at least 1 year.• Be operating profitably, based on U.S. operations.• Have an understanding of the costs associated with exporting.• Have a strategic plan for exporting.Contact Jennifer Kocs at 651-259-7488 or email jennifer.kocs@state.mn.us formore information.Pooler, logistics coordinator. "Argentinacompanies, for example, are now requiredto have a license to import machineryand tools. This is a sizeable market forus and wasn't an issue before 2008. Nowthese companies have to wait 60 to 90days to obtain a license to buy from us."She went on to say that exports toChina and Europe were down slightly,partly because of the European crisis, butseem to be holding steady. Mexico, onthe other hand, has been doing very well."We've noticed a lot of companies havemoved their companies from overseasback to Mexico," she said.Proceeding with CautionThe <strong>Minnesota</strong> Trade Office isone resource for small manufacturersapproached by foreign companies. Theagency has a free technical assistancephone line and email address that cananswer everything from whether anoverseas company is legitimate to whathappens if an order gets stuck in customs."There are some risks with exporting,"Clark acknowledged, "which is why youwant to enter it smartly. Every now andthen we get calls from companies thatreceive a questionable email inquiry. Afterworking with both the U.S. CommercialService and the Foreign CommercialService, we've been able to determine thatsome are indeed scams."One suggestion she mentioned formanufacturers is to consider signing up forthe U.S. Commercial Service's Gold KeyProgram, which acts like a matchmakingservice for U.S. companies looking tosell and foreign companies looking tobuy. That way manufacturers will knowthey are doing business with trustworthycompanies right from the start.Planning for GrowthThough a large number of <strong>Minnesota</strong>businesses already are exporting, thereseems to be plenty of room for growth.Though small businesses comprise nearly90 percent of the state's exporters, theyaccount for just 20 percent of exportsales. In fact, the Minneapolis/Saint Paulmetro area is the 14th largest market forexports in the country, but ranks 67th forexport growth—a ranking the <strong>Minnesota</strong>Trade Office is hoping to improve overthe next few years."There's a significant opportunityin the metro area to focus on growth,"Clark said.To boost exports among smallbusinesses, the <strong>Minnesota</strong> Trade Officerecently announced an ambitious initiativeto double the metro area's exports from2012 to 2017. Through a federal grant,it launched the MSP Export Initiative, aplanning group involving MinneapolisMayor R.T. Rybak, Saint Paul Mayor NormColeman, and several other political andbusiness leaders. Over the next year, thisgroup will be exploring which resourcesand programs are needed to supportexports at a local level. Minneapolis/SaintPaul was one of just four metro areas inthe country selected to pilot this work.A recent success of MSP ExportInitiative was the 2012 opening of theEx-Im Bank in Minneapolis. The groupshared the need for such a bank withthe federal government and the federalgovernment responded. Currently, theMSP Export Initiative is working oneverything from branding the MSPregion in other parts of the world toincreasing the number of accessibleexport containers.If the <strong>Minnesota</strong> Trade Office issuccessful in its efforts to double themetro area's exports by the end of 2014,that would add another $5 billion inrevenue and 114,900 jobs. It also wouldmean a broader, more diverse customerbase for <strong>Minnesota</strong> companies."One thing we need to remember isthat 95 percent of the world's populationand 75 percent of the world's buyingpower is located outside the United States,"Clark said. "In order to be competitive inthe future, the state as well as individualbusinesses need to continually focus onPMhow to grow exports."MELISSA DEBILZAN is a contributing writer forIntrinXec Management, Inc. She can be reachedat melissa@mpma.com.10 | PRECISION MANUFACTURING January | February 2013
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