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An Energy Revolution for Israel

November 9, 2012

David McCormack is an International Trade Specialist in ITA’s Manufacturing and Services unit.

The Oil and Gas Trade Mission to Israel business delegation.

The Oil and Gas Trade Mission to Israel business delegation.

Led by the Acting Deputy Under Secretary of Commerce Ken Hyatt, the U.S. Commerce Department Oil and Gas Trade Mission to Israel introduced 13 companies and 2 universities to the growing oil and gas industry in Israel. The participating organizations included two premier U.S. universities – The University of Texas, Austin and Texas A&M University, Kingsville.  Other Delegates included leaders in oil field services, logistics, consulting, data integration, consulting, and manufacturing.

The mission built on excellent trade relations between the countries, including America’s first ever Free Trade Agreement, signed by the U.S. and Israel in 1985.  More recently, U.S. Senator, Mary Landrieu brought the first ever oil and gas Certified Trade Mission to Israel in 2011, and the Government of Israel sent an inter-ministerial delegation to the U.S., earlier this year to see extensive energy development firsthand. Finally, on October 24, the US-Israel Joint Economic Development Group (JEDG) met in Washington, chaired by U.S. Treasury Secretary, Tim Geithner, and Israeli Treasury Director-General Doron Cohen.  A main topic of discussion was enhanced U.S.-Israel cooperation for natural gas development.  As the JEDG signed an agreement that will extend U.S. loan guarantees of $3.8 billion to Israel to 2016, the trade mission to Israel departed for Tel Aviv to explore the histroric opportunities to help build Israel’s new energy economy.

According to a 2010 United States Geological Survey (USGS) assessment, the Eastern Mediterranean contains approximately 122 trillion cubic feet (tcf) of natural gas, with a current market value of $240 billion. Industry representatives also report that they expect to discover oil in these offshore fields.  Finally, exploration efforts are also ongoing onshore Israel, creating opportunities for manufacturing, drilling, pipeline installation, etc.  Without a developed infrastructure to produce enough of their own energy domestically, Israel has historically been an energy importer. This will not always be the case, and many have recognized that these recent developments represent an energy revolution.  Many expect Israel to become a net energy exporter, but right now, extensive infrastructure and devlopment is needed.  U.S. companies are ready to deliver.

Hosted in Israel by Senior Commercial Officer Maria Andrews, the trade mission delegates attended the 2012 Israel Energy and Business Convention (IEBC), conducted site visits, attended receptions, participated in a roundtable discussion with Israel’s oil and gas industry, and participated in more than 100 customized business meetings.  The official program began at the IEBC, where Hyatt delivered a speech at the opening ceremony, and the U.S delegation was warmly received.

At the roundtable discussion hosted by Hyatt, Senator Mary Landrieu, and the Chair of Israel’s oil and gas association, Uri Aldubi, the delegation received presentations from Noble Energy, Zion Oil, and Genie Energy.  Noble briefed the delegation on their discoveries of around 30 trillion cubic feet of gas offshore Israel, and their future hopes for more gas, as well as oil, discoveries.  Zion, the largest onshore petroleum exploration leaseholder in Israel, spoke about how to do business in Israel, as a U.S. company, and their optimistic outlook towards Israel’s onshore potential.  Finally, Harold Vinegar, from Genie Energy, shared his vision for the development of oil shale in Israel.  Vinegar, formerly a Chief Scientist at Shell, stunned the crowd with his estimate of 250 billion barrels of recoverable oil in Israel’s shale deposits.  That evening, U.S. Ambassador to Israel, Daniel Shapiro, hosted the delegation at his residence for an exclusive networking reception with the leaders of Israel’s new energy economy.

Thanks to the efforts of the Commercial Service in Tel Aviv, the delegation received a rare and intimate tour of the port of Ashdod, and discussed opportunities in pipeline installation and logistics with port authorities.  Keeping a full schedule, they also attended government meetings in Jerusalem, and a high-level presentation and networking session, with industry and government leaders, hosted by the Herzliya Conference, and the Law Firm of Heideman Nudelman & Kalik, a CS Strategic Partner.

While in Israel, Hyatt met with several key government offices, including the Ministry of Energy and Water Resources, the Ministry of Trade, and the Office of the Prime Minister

U.S. Senator Mary Landrieu highlighted the opportunities for academic cooperation between the U.S. and Israel.  There are almost no Israeli born petroleum engineers still in Israel.  Universities in the Gulf states represent the best programs in petroleum and gas engineering, and specialized energy MBA’s in the world.  The 2011 and 2012 Oil and Gas Trade Missions to Israel are laying the groundwork for Israel’s energy industry by bringing advanced petroleum and gas engineering programs to Israel.

The delegates completed the mission feeling optimistic about the commercial opportunities in this sector.  The companies realize that doing business in Israel is often a long-term proposition and this will be the first of hopefully many visits to Israel that the companies will make.  The U.S. Commercial Service and our Strategic Partners are standing by to assist U.S. firms in accessing the historic opportunities represented by Israel’s energy revolution.

Posted in Commercial Service, Exporting, International Trade Administration, Trade Missions | Tagged , , , , | 2 Comments »

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Workshop Shows Exporters How to Overcome Barriers to International Trade

October 24, 2012

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

Skip Jones is the Deputy Assistant Secretary for Trade Agreements and Compliance.

Assistant Secretary Michael Camunez delivers keynote speech at the Defeating Foreign Trade Barriers Workshop at the U.S. Chamber of Commerce.

Assistant Secretary Michael Camunez delivers keynote speech at the Defeating Foreign Trade Barriers Workshop at the U.S. Chamber of Commerce.

U.S. products are the most sought-after products in the world.  However, U.S. companies sometimes have problems selling their products abroad. They encounter various foreign government-imposed trade barriers such as unfair technical requirements, discriminatory government procurements, or unfair customs valuation practices. In many cases, these difficulties represent a country’s not honoring its trade agreement with the United States.

To address these difficulties, the U.S. Department of Commerce operates the “Trade Agreements Compliance Program.”  Representatives from the U.S. Department of Commerce, the Office of the U.S. Trade Representative, and the U.S. Chamber of Commerce offered participants expert advice at a “Workshop to Defeat Foreign Trade Barriers” in Washington, DC, and explained how to take advantage of this free Commerce program.

The day-long event was organized by the National District Export Council and the U.S. Chamber of Commerce. It featured numerous panels, roundtables and keynote addresses.

The speakers discussed current trends in foreign non-tariff barriers, and the government programs and policies available to combat them.


Download full video .mp4 (22MB)

The message was clear: The U.S. government is doing everything it can to help American businesses overcome these barriers as quickly as possible. As the Under Secretary for International Trade, Francisco Sánchez, stressed in his remarks to the audience :

“Trade agreements can serve as powerful export multipliers, but they need to work properly to reach their full promise,” he said.  “The Commerce Department intends to do its part to see that they do. Let us know when you encounter trade barriers abroad. Work with us so we can remove them as quickly as possible so that your job-creating exports can flow to foreign markets unhindered, just as they should.  ITA’s Trade Agreements Compliance program is a terrific, free resource for U.S. exporters encountering these trade barriers.”

In addition to Under Secretary Sánchez, over 30 speakers offered their insight to the participants – among them, U.S. Trade Representative Ron Kirk, Assistant Secretary for Market Access and Compliance, Michael Camuñez, and Acting Assistant Secretary for Trade Promotion and Director General of the U.S. & Foreign Commercial Service, Ambassador Chuck Ford.

U.S. companies are highly successful in international markets, if they can compete on a level playing field. Efforts like today’s workshop, as well as the underlying work of all U.S. government agencies, help ensure that is the case.

If your business encounters a trade barrier, please visit http://tcc.export.gov/Report a Barrier for assistance.

Posted in Commercial Service, Exporting, Interagency, International Trade Administration, Market Access and Compliance, Trade Shows and Trade Events | Tagged , , , | 3 Comments »

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Banner Year for U.S. Advocacy Center

October 16, 2012

Bryan Erwin is the Director of  The Advocacy Center in the U.S. Department of Commerce’s International Trade Administration

The Advocacy Center of the Department of Commerce has had its most successful year since its creation in 1993. Never before has the Center helped U.S. businesses win as many international public contracts as in the past fiscal year 2012 .

U.S. companies won 53 international contracts, with a total value of $87.1 Billion. Of this amount, $73.9 Billion is U.S. export content – which means that it was made here in the U.S. – ensuring jobs for Americans. In fact, the Advocacy Center estimates that our work has helped support some 370,000 U.S. jobs.

These statistics are a record for us. In the year before, the value of the U.S. exports in the contracts was only $23.7 Billion. In 2010, it was $16.8 Billion.

Our mission is to coordinate U.S. Government resources and authority in order to level the playing field on behalf of U.S. business interests as they compete against foreign firms for specific international contracts or other U.S. export opportunities. In doing so, the Advocacy Center helps create and retain U.S. jobs through exports. And our success in 2012 was very much a collaborative effort of the whole of the Department of Commerce, and in some cases whole-of government.

But it is not only the total number which is impressive. The Advocacy Center also helped more sectors vital for the National Export Initiative win contracts. One fifth of the acquired contracts were won by Small and Medium Enterprises. Their share used to be in the single digits.

The clean energy and environmental sector and the health care sector were also able to acquire more business. International contracts won in 2012 will support almost 2,400 US clean energy jobs and 200 U.S. healthcare jobs.

A focus of the Center has also been Emergency Rescue and Disaster Relief Projects, contracts in Reconstruction Areas, and bidding contests in the so called BRIC (Brazil, Russia, India and China) markets. In each of these focus areas, the Advocacy Center was able to assist more U.S. firms win contracts than in the recent past.

One example of our success in an emerging market is in Indonesia, in which case the U.S. Government advocated on behalf of Electro-Motive Diesel Inc. (EMD), based in LaGrange, IL, to win a government contract in Indonesia. In August, EMD reported that it was awarded a contract to provide PT Kereta Api Indonesa (PTKA), a state-owned railway company, with 44 diesel-electric locomotives as a result. EMD estimates that the total value of the procurement at $140 million, with U.S. export content of $94.0 million. And this contract will help support 470 U.S. jobs alone!

Our work on behalf of U.S. businesses is important that ever as we continue to help position companies to compete in an increasingly competitive global marketplace. That is why although 2012 was the Advocacy Center’s most successful year – we are already working on breaking this new record in 2013.

For more information about the Advocacy Center, please visit http://export.gov/advocacy/

Posted in Commercial Service, Exporting, Finance, International Trade Administration, National Export Initiative | Tagged , | 1 Comment »

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U.S. India Importers’ Council Joins ITA’s Global Buyers Initiative

October 2, 2012

Matt Kennedy is the director of the Strategic Partnership Program

Under Secretary Sanchez and 3 DHL CEOs make ITA and DHL’s new partnership official at an MOU signing ceremony in New York City.

Under Secretary Sanchez and 3 DHL CEOs make ITA and DHL’s new partnership official at an MOU signing ceremony in New York City.

Yesterday, the U.S. India Importers’ Council (USIIC) joined the ITA’s Global Buyers Initiative. At the signing ceremony, Acting Assistant Secretary for Trade Promotion and Director General of the U.S. & Foreign Commercial Service Chuck Ford said, “Extending the global buyers initiative to India emphasizes the importance of trade for our two nations and brings our business communities one step closer together.”

As part of the Initiative, USIIC  will refer Indian companies in search of new technologies or alternative sources of supply to the USFCS who will then connect India’s company directly to US businesses who can meet their needs.

India is a key trading partner and US businesses – especially in aerospace, healthcare and medical devices, education, construction services, energy and environment, information and communication technology, textiles, defense and security and export facilitation services should consider expanding to the region. And our work with the USIIC is just one example of how our partners are helping US businesses grow their exports.

As part of the National Export Initiative, the International Trade Administration has focused on utilizing the expertise of the private sector, trade associations and state and local organizations to increase our effectiveness and reach more small businesses.

Each organization plays an important role to increase US exports and create jobs here in America. Over the last year, our partnership program here at ITA has grown from 15 to more than 122. Together our partners, large multinational companies like UPS, FedEx and DHL, to trade associations like the National Association of Manufactures and National Marine Manufacturers’ Association, to state and local organizations like the Pasco Economic Development Council, have helped us reach tens of thousands of small business owners and connect some directly to business opportunities.

If your organization would like to work the ITA please send us an email.

Posted in Commercial Service, Exporting, International Trade Administration | Tagged , , , | 3 Comments »

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Constructing Partnerships: Evergreen Building Products and ITA Reach New Heights in the Building Industry

October 2, 2012

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Tyler Voorhees is an intern in the Office of Public Affairs at the International Trade Administration. He is a senior at Washington and Lee University in Lexington, Virginia.

U.S. building materials industry representatives share the latest “green building” products and technologies with Chinese builders, architects and designers at a technical seminar earlier in 2012.

U.S. building materials industry representatives share the latest “green building” products and technologies with Chinese builders, architects and designers at a technical seminar earlier in 2012.

Construction is an important industry to the American economy, and employs Americans in all stages of the supply chain, from logging to the manufacture of new and innovative building supplies. With low domestic demand, it is especially important for those in the industry to turn to foreign markets to help sustain and support American jobs.

In developing countries, there is huge potential for U.S. building product exporters, especially in high-value areas. Currently, we’re seeing a massive new infrastructure builds in emerging economies, and they are looking for more sustainable construction technology, which is perfect for American exporters. At the International Trade Administration (ITA) we’ve made it a priority to help expand global market share for U.S. building products exporters. This export sector encompasses a wide range of basic materials ranging from basic materials (wood, glass, paint) to installed machinery (windows, air conditions). The sector employs roughly 2.2 million U.S. workers.

There are many programs and initiatives within ITA that work with local businesses to promote trade and exports. Our Commercial Service  has local chapters in major cities across the country and in many foreign markets to help match domestic suppliers with foreign buyers. One of the most effective programs we have though is the Market Development Cooperator Program (MDCP). Through MDCP, ITA partners with non-profit industry groups such as trade associations and chambers of commerce to provide funds and technical assistance for export promotion programs that are aimed at enhancing an industry’s global competitiveness in target markets. Non-profit industry groups are particularly affective at reaching local small and medium-sized enterprises, a focus for ITA.

Partnership awards do not exceed $300,000 and partners pay two-thirds of the cost of the program while ITA provides the remaining third. This approach helps to ensure that the program is sustainable beyond the initial partnership. From 1997 to 2011, MCDP projects generated $219,000 in exports for every $1,000 invested. Any businessperson in the private sector would be astonished at such a high return on investment. Clearly, the MDCP program is a hugely successful program and a great example of the potential in public-private sector partnerships.

Awardees range in industry as well as geography, yet all focus on expanding exports and increasing jobs. Some of the more innovative and successful partnerships include the hosiery industry targeting Japan to promote the export of American made socks and independent film industry.

Engaging China is a priority within the Department of Commerce, both to highlight export opportunities as well as ensure fair trade. China is a particularly important market for building product suppliers for many reasons, most importantly shear demographics. There is projected to be over 221 cities with populations of over one million alone by 2025.

This huge urbanization of not only first tier cities like Beijing, Shanghai and Guangzhou, but also second tier cities means that there will be many large, lucrative markets for U.S. suppliers. Not only that, there will be a growing middle and upper class that will want and be able to afford high quality homes as well an aging population that will soon need the same type of senior housing that we have in Western countries. In conjunction with positive demographic factors, the Chinese government has made it a priority to adopt more energy efficient technology, including building products and heating, ventilation and air conditioning (HVAC) systems.

The Evergreen Building Products Association (EBPA) from Tacoma, Washington, has a proven track record of working with the MDCP program to promote exports to China through their U.S.-China Build Program (UCBP). In 2001, Evergreen submitted a project proposal that garnered their first partnership. The focus was to support the promotion of earthquake resistant building technology. In 2008, they submitted another successful project to promote green building technology in China.

Just last month, Evergreen received their third award which is focused on promoting housing for elderly in China. Since their most recent partnership award in 2008, UCBP trade mission participants reported $190 million in export sales. This amounts to $1,283 in exports for every dollar of federal funding through the MCDP program! These exports sales translate directly to jobs for Americans- participants credit the program with helping to create 300 jobs in the last half of 2010 alone.

The most recent proposal builds on their past work, but also highlights the promotion of senior housing. As China’s population ages, it will be necessary to consider new types of housing that can accommodate older residents. Given our older population, the U.S. building product manufacturers are already accustomed to this market. With the help of Evergreen, building product manufacturers are hoping to export senior housing building products abroad and grow their businesses. There are huge opportunities, and Evergreen will help by leading two trade mission annually and helping to match U.S. producers with Chinese buyers.

Again, given the previous success of the program, everyone at ITA is excited about the prospects for this new MCDP grant. This is another example of the opportunities that become available to American companies as China grows and begins to consume the same type of goods at we do in America. To learn more about the MCDP awards, visit our website. Also, to learn more about the resources we have to help export abroad, visit www.export.gov.

Posted in Commercial Service, Exporting, Green and Sustainable, International Trade Administration, Manufacturing, Manufacturing and Services, Trade Shows and Trade Events | Tagged , | 1 Comment »

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Transportation: Helping the Economy Move Forward

August 7, 2012

Francisco Sánchez serves as the Under Secretary of Commerce for International Trade. Follow him on Twitter @UnderSecSanchez.

Healthy economic development depends on a healthy transportation system.  That’s because people depend on everything from boats to trains to get to work, move their products, and help customers shop at their stores. 

Across the globe, as economies push for more growth and development, there is increasing demand for transportation-related products and services, presenting an incredible opportunity for U.S. businesses. 

Under Secretary Francisco Sánchez during a ceremony formalizing a partnership to promote exports between ITA and the American Association of Port Authorities.

Under Secretary Francisco Sánchez during a ceremony formalizing a partnership to promote exports between ITA and the American Association of Port Authorities.

For that exact reason, a major focus of our work at the International Trade Administration is on the transportation sector.  As you’ll see in this issue of International Trade Update, we’ve been working to help U.S. businesses in this field succeed in a number of ways.  

For example, I was proud to participate in the Farnborough International Air Show, the world’s largest aerospace trade exhibition of 2012. Every other year, the global aerospace industry descends on England to exhibit their latest products and initiate partnerships. This year, $47 billion worth — that’s billion with a ‘b,’ — of orders were announced during the show. 

As the largest aerospace industry in the world, this one sector contributed more than $89 billion in export sales to the U.S. economy in 2011, a 9 percent increase over the previous year. Furthermore, according to a study by the Economic and Statistics Administration of the Department of Commerce, aerospace directly supported more jobs through exports — 488,000 —than any other industry in 2011.

Other promising transportation sectors that achieved significant export shipments last year include motor vehicles ($63.4 billion), motor vehicle parts ($53.2 billion) and ships and boats ($2.4 billion).  Behind all these numbers is a significant story. Every time a business makes a sale abroad, that impacts bottom lines, jobs, communities and futures here at home. 

Clearly, there are significant possibilities in this space. And the good news is that in the first five months of 2012, transportation equipment accounted for nearly $101 billion of U.S. exports, up 17.2 percent from the same months of 2011.

ITA is committed to keeping this momentum going. We continue to hold trade missions focused on transportation, including some later this year to South Africa, Zambia and Turkey.

We support the President’s recent announcement to help modernize and expand 5 major ports in the United States, thereby helping American businesses reach overseas markets more efficiently.

ITA is committed to keeping this momentum going.  We continue to raise a lot of awareness for our programs and will work hard to promote international trade, open foreign markets, and create jobs and opportunities for the American people.   

Together, we can help the world meet its transportations needs far into the future, while strengthening businesses on our shores.

Related

Posted in Commercial Service, Competitiveness, Exporting, International Trade Administration, International Trade Update, Manufacturing | Tagged , , , , , | 2 Comments »

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Spreading the Word about Doing Business in Latin America

July 31, 2012

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

Francisco Sánchez is the Under Secretary for International Trade

It’s been a busy couple of weeks. Just last week, I testified before the Senate Foreign Relations Subcommittee on African Affairs, chaired by Senator Robert Menendez (D-NJ) about new opportunities for trade that are emerging in Sub-Saharan Africa. Today, I testified in front of the Senate Foreign Relations Subcommittee on the Western Hemisphereabout the importance of trade with Latin American countries.

Under Secretary for International Trade Francisco Sánchez testifies at the Senate Foreign Relations Subcommittee on the Western Hemisphere about the importance of trade with Latin American countries. (Photo Commerce)

Under Secretary for International Trade Francisco Sánchez testifies at the Senate Foreign Relations Subcommittee on the Western Hemisphere about the importance of trade with Latin American countries. (Photo Commerce)

Two years ago, President Obama announced the National Export Initiative (NEI) with the goal of doubling U.S. exports by the end of 2014. The entire Department of Commerce, and especially everyone here at the International Trade Administration (ITA), has been working to make that goal a reality.

In 2011, U.S. exports reached a record $2.1 trillion in value, and supported 9.7 million jobs, an increase of 1.2 million compared to 2009. Throughout our economic recovery over the last three years, export related job growth has been a bright spot, proving that American products and services can compete anywhere around the world.

To keep this momentum going, we want to maximize opportunities available to all U.S. companies, large and small. That work leads us to Latin America.

President Obama has noted that the future of the U.S. is closely linked to the futures of our neighbors in Latin America.  Last year, U.S. merchandise exports to Latin America totaled $367 billion, representing an increase of 54 percent compared to 2009, faster than the 36 percent increase seen with the rest of the world. Clearly, Latin America is a key part of the U.S. export success story and is playing an integral role in the success of the NEI.

We are fully committed to helping maximize more opportunities in the region. Earlier this year, members of the Administration and private sector partners came together to participate in the CEO Summit of the Americas in Cartagena, Colombia. The President also recently announced that the United States and its partners extended an invitation to Mexico to join the Trans Pacific Partnership trade negotiations.

The United States has also passed trade agreements in Colombia and Panama that give U.S. companies more access to these important markets. The U.S.-Colombia Trade Promotion Agreement took effect on May 15th, and we are predicting that Colombia will spend $26 billion in the next four years on infrastructure projects, representing a huge opportunity for American businesses.

On a more personal level, ITA’s Commercial Service division has been working tirelessly to bring foreign buyers in contact with domestic supplies. For example, our Miami office helped a local supplier of oil and gas equipment secure a contract with Brazilian oil company, Petrobras. Our SelectUSA initiative also promotes the USA as the top destination for foreign capital. Mexico and Brazil are priorities in this effort because of their close proximity to America.

To keep up on further developments, visit our website, www.trade.gov, or follow our twitter account, @TradeGov. Increased trade will help continue the strong resurgence in American exporting we’ve seen since 2009 and help continue to provide good-paying jobs to millions of Americans. And that is a story worth sharing.

Posted in Commercial Service, Competitiveness, Exporting | Leave a Comment »

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U.S. Sock Maker Pedals Through Trials to Reach Global Markets

July 31, 2012

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

Doug Barry is a Senior International Trade Specialist in the Trade Information Center, U.S. Commercial Service within the International Trade Administration.

Shane Cooper is president of DeFeet International, a maker of cycling and other socks in Charlotte, North Carolina.  He’s a client of the Charlotte Export Assistance Center.  Over the years and despite substantial adversity, he has built the business that now includes distributors in 35 countries.  I chatted with him during his trip to Washington to receive the Presidential “E” Award for excellence in exporting.

Barry:  Tell us what you make and how DeFeet started.  Where did you get the idea?

Gerd Klose, Managing Director of DeFeet's distributor in Germany Lynn Moretz, VP International Sales and Shane Cooper, founder of DeFeet display their products during the Eurobike show in Friedrichshafen, Germany. (Photo DeFeet)

Gerd Klose, Managing Director of DeFeet’s distributor in Germany Lynn Moretz, VP International Sales and Shane Cooper, founder of DeFeet display their products during the Eurobike show in Friedrichshafen, Germany. (Photo DeFeet)

Cooper:  My wife and I were bike racers back in the early ’90s.  And in the summertime, she was supplementing her income by racing bikes as an amateur and I was spending her supplemental income as an amateur on my bike racing.  And my father was a sock knitting machine technician and sold the parts.  And so I grew up in the sock industry.  And I was a cyclist.  One day, I decided to make socks to pay for my racing.  It just kind of happened from there.  We made the world’s best sock for cycling and that was 20 years ago.

Barry:  Is that a pair of your socks on your feet?

Cooper:  Absolutely.  This is the Peloton, made of merino wool.  And if you notice, there’s a group of cyclists.  And the yellow jersey’s right there. And “peloton” is a group of cyclists.

Barry:  Tell us your biggest challenge in going international.  You had this great background and created the product.  But very few U.S. businesses go outside the country looking for customers.

Cooper:  It happened by chance.  We created product that world-class cyclists were taking over to Europe.  And we had this product on their feet.  So there was a desire from the customer before we had international distribution.  And so our brand grew from there.  Cycling in Europe is tremendous in size, similar to American baseball and football.  I was struggling myself, not being a true businessman.  And I met this wonderful man, Lynn Moretz, who came into our company and became my mentor and helped us capitalize on this desire that we had created as a brand into a real business.  And so Lynn was able to take it into these countries and give structure behind the madness that I had created.

Barry:  Your product was transported by your U.S. customers and introduced to potential international buyers to where it really became a process and a strategy.

Copper:  Yeah, process and strategy, pricing structures, the advent of the Internet and what was going to play there and how it was going to actually work and these international customers over the course of the last 20 years were coming to our website, finding the product and going, “where can I get it”?  They would see it on the best riders in the world.  And they’re asking where they could get it.  I was too busy paying attention to R&D and the product to really focus on that.  And then Lynn came in and provided that structure to actually make it happen.

Barry:  What in your mind was the biggest challenge that you overcame and that your collaborator overcame in that area?

Cooper:  Well, unfortunately the year that my collaborator, Lynn Moretz, came to DeFeet, we burned down.  We lost everything we had – 2001, October, right after 9/11.  And so we had nine months of no production. 

Barry:  That would be a crushing thing to happen for most people.  How did you manage to rise from the ashes, as it were?

Cooper:  I would like to say that I cut my hair off and used that to rebuild the building.  But I think the hair came off in the process somewhere.  We had insurance that covered the building, the equipment and the contents.  And then we had insurance for business loss, income loss, which turned into a court battle for three years.

Barry:  What happened next?

Cooper:  And so when we finally got the check, we had to pay taxes out of that money because it’s business income.  So for seven years – the first nine years of our business, we were profitable every year and growing organically.  The banks loved us – or the banks hated us because we actually paid the loans off too early. We had seven years where we made no money after the fire.  We became profitable again and started winning the business back.   OK, keep this in mind.  It’s 2008.  We’re profitable that year just in time for the worst economic downturn in world history that we know about, other than the Depression.  And the fortunate thing is that these bicycles were being pulled out of the garage and people were putting tires on it and commuting. And it made the bicycle shops flush with cash.  The dollar was going crazy with the euro. So all of a sudden, after seven years of struggling, we made it through.  And now, we’re four years in with profits again.

Barry:  Did international expansion save you?

Cooper:  If we didn’t have our international business, gosh, I don’t think we would have made it. 

Barry:  So you and your wife are pretty persistent.  Do you think that persistence is a useful skill to have in the international marketplace?

Cooper:  I think persistence is something that you have to have to be in business in any country.  In my opinion, it may come from the bike racing that we did that hardened us and toughened us up.  And we’re not quitters.  We could have shut our plant down and moved it to Asia and had socks made over there.  But we decided to stay put.  We never missed a pay period with our employees.  And we buy local yarn and boxes.  So even though we’re only 38 employees now, the benefit is pretty widespread when we buy locally.

Barry:  Why not outsource to China?  Wouldn’t it be cheaper in the long run?

Cooper:  Cheaper – that’s a good word. I prefer the word value.  And what we prefer to use that word value is for long-lasting goodness, affordable price and a sock that’s going to last 10 years.  I don’t like the homogenization of other sock brands making their product in the same plant that I’m making mine in and all of a sudden my trade secrets are gone.  I don’t like the environmental issue. I don’t like the lead in the toys, the drywall issues with radioactive materials and the lunch boxes with the toxic waste in them.  You hit a nerve there.  And so American-made to me is control.  It’s American jobs.  It’s quality, and mostly it’s value. 

Barry:  And when did the U.S. Department of Commerce and the U.S. Commercial Service in particular come into the story?

Cooper:  Anytime we have a question about a tariff, or when we’re dealing with Australia and we’re not sure what to do, or a new free trade (agreement), or some new idea comes up, we call the (Export Assistance Center) office in Charlotte.  Then there are international textile agreements and an understanding of how the sock is structured with what material and where the fibers come from and what category it fits in.  You guys have been a great help there.  You’ve got to remember, I was a dumb bike racer, a bad one at that.  I wasn’t a businessman. 

Barry:  Have you learned things from your customers in Europe that you’ve been able to apply to your products that have helped you sell other places?

Cooper:  We get input from the word’s best riders.  Paolo Bettini, the Italian national champion, Olympic champion – sat down with me and we had a translator on what he needed in a sock. We then listened to him and made that sock available to the public.  So we used the world’s best cyclists to develop the sock, like astronauts, and then we took it to their fan base. 

Barry:  Is it a trade secret or can you tell us what he told you?

Cooper:  That is a trade secret. 

Barry:  Can you share some advice with us for other companies that are thinking about exporting?

Cooper:  My advice is figure out what your strengths are.  Use every available government agency’s help as well to really make your life a lot easier.  If you don’t have the skills or time to so the international, hire someone who can do it. 

Posted in Commercial Service, Competitiveness, Exporting, Success Story, Textiles | Tagged , , | Leave a Comment »

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For Columbia Technologies, Success in the Global Market is about Commitment and Execution

July 24, 2012

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Doug Barry is a Senior International Trade Specialist in the Trade Information Center, U.S. Commercial Service within the International Trade Administration.

John H. Sohl III is founder of Columbia Technologies, a Maryland company that maps underground pollution from large manufacturing facilities, oil terminals, pipelines and military bases. The company is a client of the Baltimore Export Assistance Center. 

Barry:  How do you map underground pollution?

Sohl:  Mapping involves deployment of sensor technologies that track leakage and migration of pollutants.  Following analysis by our technicians, customers can make decisions on risk assessment, disposition of the property and proper cleanup actions. 

John Sohl, owner of Columbia Technologies, conducting training for partners in Mexico (Photo Columbia Technologies)

John Sohl, owner of Columbia Technologies, conducting training for partners in Mexico (Photo Columbia Technologies)

Barry:  Tell us about the company history.

Sohl:  I started the company about 15 years ago after doing similar work in the U.S. Navy.  I was always intrigued with the application of sensors and three-dimensional mapping of components, and that’s the approach we brought to the industry.  The world really is getting flat and many of our clients are global industries that have footprints both in the U.S. and North America as well as the globe.  So once we’ve established a good working relationship and reputation with those firms, they sought to bring us into other parts of the globe.

Barry:  So your initial market entry strategy was to piggyback on clients here in the U.S. and ride them into new markets.

Sohl:  Exactly.  And Columbia started closer to home, as many U.S. exporters do. We first migrated up to Canada and performed services up there and sort of cut our teeth on export, and the second, we went down to Mexico and performed the same types of services, and additional services in Mexico.  And so that’s been the first two exports in terms of direct boots on the ground, so to speak, of sensors and folks.

Barry:  Any additional boots?

Sohl:  Yes, in Latin America, including Brazil, Argentina and Colombia. Peru is likely the next target of opportunity.  We’re careful not to grow too fast.  What’s our capacity as a small business to move into markets?  We’re focusing on Latin America at this point in time based on the customer base and the business deals that we can put together in those markets.  Next will be Asia but that’s a much more complex world.

Barry:  Is employment growing in step with the international business?

Sohl:  We’ve grown recently from 10 employees to 13. We expect to double the size of the staff once the Brazil projects are fully underway later this year. International means a lot to us.

Barry:  What was the biggest surprise for you in getting out in the world?

Sohl:  Well, nothing bad.  The biggest is the enthusiastic welcome we as people and our services receive wherever we go.  But I think what was really a very pleasant surprise was how eager people were to help us move into those countries and bring the services in there, because a lot of what the technologies that the U.S. companies have are unique in some of these other locations.  I was really welcomed with open arms to come down there. The expertise, the experience, the technologies are very important. Yes, I think many of the purchase decisions are made based on the fact that we are bringing to these countries quite a valued proposition.

Barry:  Any horror stories with getting paid?

Sohl:  I can say, so far, our experience has been nothing but positive.  We had very, very little issues with payment terms, and certainly had some slowdowns in moving equipment and things into various countries, but nothing that we didn’t really anticipate.

Barry:  Tell us how you got started in Mexico?

Sohl:  We had already decided to go to there and then we heard about a trade mission called Trade Winds that was being held that year in Mexico. A major benefit of working with U.S. Commerce was that we attended the Trade Winds expositions, where were connected with a lot of commercial officers from Mexico and throughout Latin America.  We got introductions to people who expressed an interest in purchasing our services. We were briefed on Mexican customs regulations and the best methods to get our equipment in and out of the country.  So even if I’m visiting on a non-official visit to the Commercial Service side, I’m able to get an audience and gain some help from those people locally based. Being welcomed, being introduced to people in the business community in Mexico was very beneficial for us.

Barry:  What’s your advice to companies considering starting to export or expanding to new export markets?

Sohl:  Probably the primary piece of advice is don’t feel like you have to do it alone.  I mean, the Commercial Service is there to help.  Sit down with your local representative, lay out a strategy, think through the strategy and don’t just try to go execute without thinking through all the pieces of the puzzle.  Use the resources.  Do it very systematically in a very coordinated planning mode.  You don’t have to do it as a fire drill.  Another lesson is that our competition is foreign.  It wasn’t all invented in the U.S.  So, yes, there is strong competition from Europe, strong competition from some of the Asian countries and from Australia.  We need to understand that it’s not just a U.S. market out there.  It’s very much a global market.

Barry:  What’s the key to getting repeat business?

Sohl:  The international business validates the operating mission of our company, which is its execution.  If you do your job well and you provide a good value for a fair price, you’re going to succeed in these countries and with your customers.  You can’t fake it.  So if you’re going to be in a country and executing in that country, you need to go ready to do the job and do it right. 

Once we make the decision to export and entry into a country, we’re going to stay.  So we go to build long-term relationships, both with our customers and with our partners. We’re not there on sort of a just drop in, do some work and leave kind of thing.  You have to go at it with a long-term perspective.

Posted in Commercial Service, Competitiveness, Exporting, Small Business, Success Story | 2 Comments »

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Hard Work and a Desire to do Better Powers this California Company around the World

July 12, 2012

Doug Barry is a Senior International Trade Specialist in the Trade Information Center, U.S. Commercial Service within the International Trade Administration.

Kusum and Mukund Kavia were a young married couple who came to the U.S. from Bangladesh via London. They settled in the U.S. with very little money but had their youth and the immigrant’s determination to succeed—a kind of secret sauce in the creative curry that is Southern California. Currently, their company works in 10 countries and will soon add Iraq to the mix. 90 percent of revenue comes from international sales.

In 2011 at a White House ceremony the company received the Presidential “E”- Award for excellence in exporting.  Combustion Associates is a client of the Export Assistance Center in Ontario, California.  I recently spoke with them about their story.

One of Combustion Associates 80 MW power plants being assembled in Benin, West Africa (Photo Combustion Associates, Inc.)

One of Combustion Associates 80 MW power plants being assembled in Benin, West Africa (Photo Combustion Associates, Inc.)

Barry:  You own Combustion Associates, Inc.  What do you do there?  Combust?

Mukund:  You are very close.  We design and build power generation systems using aero-derivative turbines, the kind which power aircraft. Our company provides modular power plants in the range from 1-megawatt to 10-megawatt.  Now, a 1-megawatt is the size of a 40-foot container and can power 1,000 U.S. homes.  So, when we take it to emerging countries such as Africa or East Europe or Central America, they can power villages.

Barry:  Since these villages aren’t on a national power grid, having reliable electricity helps in a variety of ways.

Mukund:  Absolutely.  Our units are there not only for power but to really help the local economy grow.

Barry:  When did you get started?

Mukund:  We started in 1991 with just a 200 square foot office.  Today, there are 60 employees with a 40,000 square foot facility.

Barry:  What was the biggest challenge the company faced getting started in the international marketplace?

Mukund:  We were not recognized in the industry.  So being a small company, we had to make a name for ourselves out there.

Barry:  How’d you do that?

Kusum:  We partnered with the U.S. Commercial Service (of the Department of Commerce) to spread our name, spread what we did, and that really elevated us to a level that we were able to be in front of the customer at the international level. Since the Commercial Service has representatives in these countries they can help find buyers for us. In some case we invite prospective customers to our facility in California.

Barry:  How did this work in the early days of the business?

Kusum:  It was interesting. We didn’t have a suitable place to meet.  One of the biggest things that I remember Fred Lauterperisa (the director of the Export Assistance Center) doing is opening up his office to us.  When I called him, he said, ‘please use my conference room.’  And that’s what we did.  We actually had our customers meet us at the U.S. Commercial Service in Ontario (California) and utilize their conference room. 

Barry:  What else did Fred do for you?

Kusum:  He also arranged for representatives of the Export-Import Bank of the U.S to attend the meeting and discuss Bank programs that provide loan guarantees to the U.S. companies for extended payment terms and money for more inventory.  Funding is also available for foreign buyers to purchase U.S. products from companies like ours.
 
Barry:  I take it that government export promotion programs have been something of a gold mine for you. 

Kusum:  The government both at the local, state and federal levels really go out of their way to help businesses blossom and grow.  And we have found that everywhere that we have gone and told people about our story, they have opened up and they have said ‘how can we help you?’

Barry:  What advice do you have for other U.S. companies that haven’t entered the global market because of fear of failure, lack of knowledge or other reasons?

Kusum:  Don’t limit yourself.  You’re already doing something that you know is your passion.  All you have to do is get out of your comfort zone and don’t limit yourself. You’re going to have different challenges – some new, some old.  But I would encourage everyone that is looking to export to say, ‘Please, why haven’t you thought of doing that?’  As Americans, I believe that all of us want to reinvent ourselves. We want to be the best we can be so that we are able to export U.S. products overseas that are quality, cost-effective and really a win-win for the countries that we’re doing business with.  At the same time, we want to go out there again and do so much more for this great country of ours, which really is a welcoming opportunity for anybody that wants to work hard and do better.

Posted in Commercial Service, Competitiveness, Exporting, Success Story | Tagged , , | Leave a Comment »

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