When thinking about how to grow your business in 2020, aim high. Don’t just limit your plans to the local community—think about selling your products or services internationally.
Research from the Institute for International Economics shows that U.S. companies that export tend to grow faster and are 8.5 percent less likely to go out of business than those that don’t. There are significant opportunities for growth in exporting, with nearly 96 percent of consumers living outside the U.S., and two-thirds of the world’s purchasing power in foreign countries. Exporting can help small businesses, which make up 98 percent of all exporters, increase profits, reduce their dependence on local markets, and stabilize sales throughout the year.
Take EarthQuaker Devices, for example. Named the 2019 U.S. Small Business Administration (SBA) Exporter of the Year, they expanded from a home office to a newly renovated 15,000-square-foot building thanks to the profits they made from exporting. You can also use international trade opportunities to reach your business goals and succeed as an exporter.
How to Dive into Exporting
Ready to expand your business overseas? Here are some steps to get started:
1. **Learn About the Market**: Use export statistics from the U.S. Census Bureau to identify large international markets with strong growth over the past few years. Don’t forget to research emerging markets where there may be fewer competitors. U.S. Export Assistance Centers (USEACs) can help if you’re unsure where to start or if your products are suitable for these markets.
2. **Connect with Buyers or Distributors**: Decide whether direct or indirect selling works best for your business. Indirect selling involves using intermediaries like export management or trading companies, which can be an easier way for small businesses to enter new markets as these companies have existing international contacts. Direct selling means you find international buyers yourself, through ads, trade shows, or an e-commerce presence.
3. **Secure Financing**: While U.S. banks might see lending to exporters as risky, there are alternative funding sources. The SBA offers programs that provide lenders with up to a 90 percent guarantee on export loans. There are also Export Express lenders that can directly underwrite loans without prior SBA approval, speeding up access to capital. Check out the various financing options available for exporters.
Resources for Potential Exporters
If your state is part of the federal State Trade Expansion Program (STEP), reach out to your local STEP office for help entering the international market. The SBA’s Office of International Trade offers a toll-free trade hotline at 1-855-722-4877. Additional assistance is available at U.S. Export Assistance Centers or Small Business Development Centers. Start exploring the numerous benefits of exporting with the help of the SBA today.
