USTR - Developing markets for your business
Office of the United States Trade Representative

 

Developing markets for your business
By: Gregory Walters, Director of Small Business Affairs, Office of the U.S. Trade Representative 11/09/2004

On November 4, 2004, the U.S. Small Business Administration’s Office of Advocacy released a study titled, “Costs of Developing a Foreign Market for a Small Business:  The Market & Non-Market Barriers to Exporting by Small Firms.”  This study investigated the issues that impair or impede U.S. small businesses from entering into foreign markets.  The complete study can be found at http://www.sba.gov/advo/research/rs241tot.pdf.

The study concluded that most small firms enter the international marketplace as a reactionary response to potential customers.  As a result, out of pocket costs of export didn’t inhibit exports, but rather psychological, personal and opportunity costs were greater barriers.  In other words, most small businesses saw exporting as taking away from there domestic sales rather than adding to them.  But for those companies who did wish to take advantage of the international market place, the large fixed costs of starting exporting were so high that they served as an impediment to exporting.

By aggressively opening markets abroad, the Bush Administration is committed to assisting U.S. small businesses proactively pursue export opportunities.  Through the U.S. Department of Commerce, the federal government offers a first step to exporting at www.export.gov.  Additionally, by calling 1-800-USA-TRADE, any U.S. company can talk to a live federal international trade specialist.  The U.S. Small Business Administration offers counseling through its representatives in the U.S. Export Assistance Centers throughout the country.  Information for their locations can be found at www.sba.gov/oit.  For small businesses that are looking to expand their international strategies, the Department of Commerce Foreign Commercial service offers several programs through www.buyusa.comU.S. small businesses looking for assistance in financing international transactions can look for resources from the Small Business Administration and the Export-Import Bank of the United States, www.exim.gov.  If your small business is interested in transaction insurance or setting up overseas facilities, the Overseas Private Investment Corporation can assist through its small business programs, www.opic.gov.

 
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