Federal Resources Help U.S. Small Business Exporters Go Global By Kelly Kemp
T he U.S. government has three premier federal agencies engaged in helping
T E X A S S U C C E S S S T O R Y
Texas Small Business Cements Overseas Sales Expansion
U.S. exporters go global: The U.S. Department of Commerce (DOC), the Small Business Administration (SBA) and the Export-Import Bank of the United States (EXIM Bank). • The DOC can help exporters locate new international markets in which to sell products, and can help identify key buyers in existing or new export markets.The DOC’s Gold Key Matching Service actually takes exporters overseas to meet face-to-face with potential distributors and buyers. • The SBA offers guarantees to lenders that make loans to U.S. exporters.These loan guarantees support purchase order financing as well as the purchase of fixed assets to manufacture export products.The SBA’s Export Express product, for example, allows exporters the flexibility of using the funds for any export development activity the company needs. • EXIM Bank provides exporters with the financial tools to help with international expansion, while minimizing risks. For example, many companies use EXIM Bank’s Export Credit Insurance policies not only as protection against buyer nonpayment but also as a marketing tool to extend open account terms to attract new customers and increase sales to existing ones. Insuring foreign receivables also allows exporters to use them as eligible collateral with a lender. EXIM Bank also offers Working Capital Guarantees to lenders that provide export financing loans.These guarantees can cover activities such as purchasing a finished U.S. product for export, the raw materials used in manufacturing a product, or opening a standby Letter of Credit needed as a performance bond. EXIM Bank also provides foreign buyer financing, where the sales of capital equipment are supported with credit insurance.This allows exporters to assign the receivable to a U.S. lender who will “cash out” the sellers soon after the product ships. The EXIM Bank also supports service exports as well as product exports. EXIM Bank can provide assistance to service exporters such as accounting firms, engineering firms and architectural firms. EXIM Bank also works with freight forwarders who invoice foreign buyers directly. More information on EXIM Bank is available by contacting Kelly Kemp, Regional Director, for EXIM Bank in Texas at grow.exim.gov/Contact-Us-Tx or by calling (214) 551-4959.
F ritz-Pak Corp., a family-owned manufac- turer of concrete admixtures based in Mesquite, Texas, has been exporting almost from the day it was launched in 1998. Fritz-Pak’s innovative products for controlling the mixing and setting of concrete have prov- en to be very popular
Gabriel Ojeda, President, Fritz-Pak
in export markets. Moreover, the company’s Slick-Pak primer has become a world standard for priming concrete pumps. Today, exports account for 35 percent of the company’s sales. “Exporting as a small business can be a risky proposition in some markets,” says Gabriel Ojeda, President of Fritz-Pak. “But having EXIM Bank coverage in place gives me the peace of mind to expand my business into new markets, while mitigating many of the risks associated with international transactions and changing market conditions.” EXIM Bank coverage helped facilitate the company’s expansion into markets that can be risky, such as India, Russia and China. To help insulate itself from the potential of buyer nonpayment, Fritz-Pak uses an economical multi- buyer insurance policy from EXIM. It allows Fritz-Pak to offer credit terms up to 180 days to its buyers and protects the company against nonpayment losses up to 95 percent of the sales invoice. When it comes to export sales, EXIM Bank fills a need for small exporters when the commercial sector is unwilling or unable to take on the risk of financing. That can translate into both sales and employment growth for U.S. based companies. Today, Fritz-Pak is selling its products in 30 countries worldwide. By increasing its international sales Fritz-Pak has been able to eliminate seasonal layoffs and keep its full production crew year-round. “We may be small, but we think big,” says Ojeda. “In an age where everything seems to be made someplace else, we’re thriving here in Texas. There’s no doubt this success is in no small part due to the services provided by EXIM Bank”
Texas.Think.Global
2017 Texas Export Guide
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