Chapter 2: EXPORT ADVICE

For companies making initial plans to export or to export in new areas, considerable advice and assistance are available at little or no cost. It is easy, through lack of experience, to overestimate the problems involved in exporting or to get embroiled in difficulties that can be avoided. For these and other good reasons, it is important to get expert counseling and assistance from the beginning.

This chapter gives a brief overview of sources of assistance available through federal, state, and local government agencies and in the private sector. Other chapters in this guide give more information on the specialized services of these organizations and how to use them. Information on where to find these organizations can be found in the appendixes.

Some readers may feel overwhelmed at first by the number of sources of advice available. Although it is not necessary to go to all of these resources, it is valuable to know at least a little about each of them and to get to know several personally. Each individual or organization contacted can contribute different perspectives based on different experience and skills.

While having many sources to choose from can be advantageous, deciding where to begin can also be difficult. Some advice from experienced exporters may be helpful in this regard. Recognizing this point, President George Bush created the Trade Promotion Coordinating Committee (TPCC) and charged it with harnessing all the resources of the federal government to serve American exporting business. The TPCC conducts export conferences, coordinates trade events and missions that cross-cut federal agencies, and operates an export information center that can help exporters find the right federal program to suit their needs (telephone 1-800-USA-TRADE).

In general, however, the best place to start is the nearest U.S. Department of Commerce district office, which can not only provide export counseling in its own right but also direct companies toward other government and private sector export services.

DEPARTMENT OF COMMERCE

The scope of services provided by the Department of Commerce to exporters is vast, but it is often overlooked by many companies. Most of the information and programs of interest to U.S. exporters are concentrated in the department's International Trade Administration (ITA), of which the subdivision called the U.S. and Foreign Commercial Service (US&FCS) maintains a network of international trade specialists in the United States and commercial officers in foreign cities to help American companies do business abroad. By contacting the nearest Department of Commerce district office, the U.S. exporter can tap into all assistance programs available from ITA and all trade information gathered by U.S. embassies and consulates worldwide. Addresses and phone numbers for all district offices, listed by state, are given in appendix III. The following sections detail the kinds of assistance offered.

EXPORT ASSISTANCE AVAILABLE IN THE UNITED STATES

Department of Commerce District Offices

Sixty-eight Department of Commerce district and branch offices in cities throughout the United States and Puerto Rico provide information and professional export counseling to business people. Each district office is headed by a director and supported by trade specialists and other staff. Branch offices usually consist of one trade specialist. These professionals can counsel companies on the steps involved in exporting, help them assess the export potential of their products, target markets, and locate and check out potential overseas partners. In fact, because Commerce has a worldwide network of international business experts, district offices can answer almost any question exporters are likely to ask or put them in touch with someone who can.

Each district office can offer information about

Most district offices also maintain business libraries containing Commerce's latest reports as well as other publications of interest to U.S. exporters. Important data bases, such as the NTDB, are also available through many district offices that provide trade leads, foreign business contacts, in-depth country market research, export-import trade statistics, and other valuable information.

District Export Councils

Besides the immediate services of its district offices, the Department of Commerce gives the exporter direct contact with seasoned exporters experienced in all phases of export trade. The district offices work closely with 51 district export councils (DECs) comprising nearly 1,800 business and trade experts who volunteer to help U.S. firms develop solid export strategies.

These DECs assist in many of the workshops and seminars on exporting arranged by the district offices (see below) or sponsor their own. DEC members may also provide direct, personal counseling to less experienced exporters, suggesting marketing strategies, trade contacts, and ways to maximize success in overseas markets.

Assistance from DECs may be obtained through the Department of Commerce district offices with which they are affiliated.

Export Seminars and Educational Programming

In addition to individual counseling sessions, an effective method of informing local business communities of the various aspects of international trade is through the conference and seminar program. Each year, Commerce district offices conduct approximately 5,000 conferences, seminars, and workshops on topics such as export documentation and licensing procedures, country-specific market opportunities, export trading companies, and U.S. trade promotion and trade policy initiatives. The seminars are usually held in conjunction with DECs, local chambers of commerce, state agencies, and world trade clubs. For information on scheduled seminars across the country, or for educational programming assistance, contact the nearest district office.

Assistance Available From Department of Commerce Specialists in Washington, D.C.: Among the most valuable resources available to U.S. exporters are the hundreds of trade specialists, expert in various areas of international business, that the Department of Commerce has assembled in its Washington headquarters.

Country Counseling

Every country in the world is assigned a country desk officer. These desk officers (see appendix II for a list), in Commerce's International Economic Policy (IEP) area, look at the needs of an individual U.S. firm wishing to sell in a particular country, taking into account that country's overall economy, trade policies, political situation, and other relevant factors. Each desk officer collects up-to-date information on the country's trade regulations, tariffs and value-added taxes, business practices, economic and political developments, trade data and trends, market size and growth, and so on. Desk officers also participate in preparing Commerce's country-specific market research reports, such as Foreign Economic Trends and Overseas Business Reports (see appendix V), available from the U.S. Government Printing Office and through the NTDB. The value of IEP's market data may be gauged from the fact that this agency develops much of the country-specific background for negotiating positions of the U.S. trade representative.

Product and Service Sector Counseling

Complementing IEP's country desks are the industry desk officers of Commerce's Trade Development area. They are grouped in units (with telephone numbers): The industry desk officers (see appendix II for a list) participate in preparing reports on the competitive strength of selected U.S. industries in domestic and international markets for the publication U.S. Industrial Outlook (available from the U.S. Government Printing Office). They also promote exports for their industry sectors through marketing seminars, trade missions and trade fairs, foreign buyer groups, business counseling, and information on market opportunities.

Export Counseling and International Market Analysis

The Market Analysis Division provides U.S. firms with assistance in market research efforts and export counseling on market research. Many of the research reports described in this chapter are planned and prepared by the Office of Product Development and Distribution, Market Analysis Division (202-482-5037).

Major Projects

For major projects abroad, the International Construction unit works with American planning, engineering, and construction firms to win bid contracts. The Major Projects Reference Room in Commerce's Washington headquarters keeps detailed project documents on multilateral development bank and U.S. foreign assistance projects. Companies able to bid on major overseas projects can reach the Major Projects Reference Room on 202-482-4876.

The Office of Telecommunications (202-482-4466) has major projects information exclusively for that sector.

Other Assistance

Rounding out the Trade Development area is a unit that cuts across industry sector issues. Trade Information and Analysis gathers, analyzes, and disseminates trade and investment data for use in trade promotion and policy formulation. It also includes specialists in technical areas of international trade finance, such as countertrade and barter, foreign sales corporations, export financing, and the activities of multilateral development banks. For more information, contact the nearest Department of Commerce district office.

EXPORT MARKETING INFORMATION AND ASSISTANCE AVAILABLE OVERSEAS

US&FCS Overseas Posts

Much of the information about trends and actual trade leads in foreign countries is gathered on site by the commercial officers of the US&FCS. About half of the approximately 186 US&FCS American officers working in 67 countries (with 127 offices) have been hired from the private sector, many with international trade experience. All understand firsthand the problems encountered by U.S. companies in their efforts to trade abroad. U.S.-based regional directors for the US&FCS can be contacted at the following telephone numbers: In addition, a valued asset of the US&FCS is a group of about 525 foreign nationals, usually natives of the foreign country, who are employed in the U.S. embassy or consulate and bring with them a wealth of personal understanding of local market conditions and business practices. The US&FCS staff overseas provides a range of services to help companies sell abroad: background information on foreign companies, agency-finding services, market research, business counseling, assistance in making appointments with key buyers and government officials, and representations on behalf of companies adversely affected by trade barriers. (Some of the more important services are described fully in chapter 7.)

U.S. exporters usually tap into these services by contacting the Department of Commerce district office in their state. While exporters are strongly urged to contact their district office before going overseas, U.S. business travelers abroad can also contact U.S. embassies and consulates directly for help during their trips. District offices can provide business travel facilitation assistance before departure by arranging advance appointments with embassy personnel, market briefings, and other assistance in cities to be visited.

US&FCS posts also cooperate with overseas representatives of individual states. Almost all 50 states have such representation in overseas markets, and their efforts are closely coordinated with the resources of the US&FCS.

OTHER COMMERCE EXPORT SERVICES

Besides ITA, a number of other Department of Commerce agencies offer export services.

Export Administration

The under secretary for export administration is responsible for U.S. export controls (see chapter 11). Assistance in complying with export controls can be obtained directly from local district offices or from the Exporter Counseling Division within the Bureau of Export Administration (BXA) Office of Export Licensing in Washington, DC (202-482-4811). BXA also has four field offices that specialize in counseling on export controls and regulations: the Western Regional Office (714-660-0144), the Northern California Branch Office (408-748-7450), the Portland Branch Office (503-326-5159), and the Eastern Regional Office (603-834-6300).

Trade Adjustment Assistance

Trade Adjustment Assistance, part of Commerce's Economic Development Administration, helps firms that have been adversely affected by imported products to adjust to international competition. Companies eligible for trade adjustment assistance may receive technical consulting to upgrade operations such as product engineering, marketing, information systems, export promotion, and energy management. The federal government may assume up to 75 percent of the cost of these services. For more information call 202-482-3373.

Travel and Tourism

The U.S. Travel and Tourism Administration (USTTA) promotes U.S. export earnings through trade in tourism. USTTA stimulates foreign demand, helps to remove barriers, increases the number of small and medium-sized travel businesses participating in the export market, provides timely data, and forms marketing partnerships with private industry and with state and local governments.

To maintain its programs in international markets, USTTA has offices in Toronto, Montreal, Vancouver, Mexico City, Tokyo, London, Paris, Amsterdam, Milan, Frankfurt, Sydney, and (serving South America) Miami. Travel development activities in countries without direct USTTA representation are carried out under the direction of USTTA regional directors, who cooperate with Visit USA committees composed of representatives from the U.S. and foreign travel industry in those countries, and also with the US&FCS. For more information, U.S. destinations and suppliers of tourism services interested in the overseas promotion of travel to the United States should call 202-482-0140

Foreign Requirements for U.S. Products and Services

For information about foreign standards and certification systems, write National Center for Standards and Certificates Information, National Institute for Standards and Technology (NIST), Administration Building, A629, Gaithersburg, MD 20899; telephone 301-975-4040, 4038, or 4036. NIST maintains a General Agreement on Tariffs and Trade (GATT) hotline (301-975-4041) with a recording that reports on the latest notifications of proposed foreign regulations that may affect trade. Exporters can also get information from the nongovernmental American National Standards Institute (212-354-3300).

Minority Business Development Agency (MBDA)

The MBDA identifies minority business enterprises (MBEs) in selected industries to increase their awareness of their relative size and product advantages and to aggressively take them through the advanced stages of market development.

Through an interagency agreement with the ITA, MBDA provides information on market and product needs worldwide. MBDA and ITA coordinate MBE participation in Matchmaker and other trade delegations.

MBDA provides counseling through the Minority Business Development Center network to help MBEs prepare international marketing plans and promotional materials and to identify financial resources.

For general export information, the field organizations of both MBDA and ITA provide information kits and information on local seminars. Contact Minority Business Development Agency, Office of Program Development, U.S. Department of Commerce, Washington, DC 20230; telephone 202-482-3237.

Foreign Metric Regulations

The Office of Metric Programs (202-482-0944) provides exporters with guidance and assistance on matters relating to U.S. transition to the metric system. It can also give referrals to metric contacts in state governments.

Fishery Products Exports

The National Oceanic and Atmospheric Administration (NOAA) assists seafood exporters by facilitating access to foreign markets. NOAA's National Marine Fisheries Service provides inspection services for fishery exports and issues official U.S. government certification attesting to the findings. Contact Office of Trade and Industry Services, National Marine Fisheries Service, Room 6490, 1335 East-West Highway, Silver Spring, MD 20910. Telephone numbers are as follows: Trade Matters, 301-427-2379 or 2383; Export Inspection, 301-427-2355; and Fisheries Promotion, 301-427-2379.

Bureau of the Census

The Bureau of the Census is the primary source of trade statistics that break down the quantity and dollar value of U.S. exports and imports by commodity (product) and country. Commerce district offices can help retrieve Census export statistics for exporters who want to identify potential export markets for their products. Firms interested in more extensive statistical data can contact the Bureau of the Census at 301-763-5140.

Census can also provide authoritative guidance on questions concerning shippers' export declarations (see chapter 12). Call 301-763-5310. Department of State

The Department of State has a diverse staff capable of providing U.S. exporters with trade contacts. These staff members include bureau commercial coordinators, country desk officers, policy officers in the functional bureaus (such as the Bureau of Economic and Business Affairs), and all U.S. embassies and consular posts abroad. While the Department of Commerce's US&FCS is present in 67 countries, the Department of State provides commercial services in 84 embassies and numerous consular posts. Their addresses and telephone numbers are published in the directory titled Key Officers of Foreign Service Posts, available from the U.S. Government Printing Office (202-783-3238). The ambassador takes the lead in promoting U.S. trade and investment interests in every U.S. embassy. All members of U.S. diplomatic missions abroad have the following continuing obligations:

Bureau of Economic and Business Affairs

The Bureau of Economic and Business Affairs has primary responsibility within the Department of State for (1) formulating and implementing policies regarding foreign economic matters, trade promotion, and business services of an international nature and (2) coordinating regional economic policy with other bureaus. The bureau is divided functionally as follows: Planning and Economic Analysis Staff; Office of Commercial, Legislative, and Public Affairs; Trade and Commercial Affairs (including textiles and food policy); International Finance and Development (including investment and business practices); Transportation (including aviation and maritime affairs); International Energy and Resources Policy; and International Trade Controls. For more information, contact Commercial Coordinator, Bureau of Economic and Business Affairs; telephone 202-647-1942.

Regional Bureaus

Regional bureaus, each under the direction of an assistant secretary of state, are responsible for U.S. foreign affairs activities in specific major regions of the world. Bureau commercial coordinators can be reached on the following telephone numbers: Country desk officers maintain day-to-day contact with overseas diplomatic posts and provide country-specific economic and political analysis and commercial counseling to U.S. business.

Cooperation between state and commerce

The Departments of State and Commerce provide many services to U.S. business jointly. Firms interested in establishing a market for their products or expanding sales abroad should first seek assistance from their nearest Department of Commerce district office, which can tap into the worldwide network of State and Commerce officials serving in U.S. missions abroad and in Washington.

Small Business Administration

Through its 107 field offices in cities throughout the United States (see appendix III for addresses and telephone numbers), the U.S. Small Business Administration (SBA) provides counseling to potential and current small business exporters. These no-cost services include the following:

Department of Agriculture

The U.S. Department of Agriculture (USDA) export promotion efforts are centered in the Foreign Agricultural Service (FAS), whose marketing programs are discussed in chapter 7, Making Contacts. However, other USDA agencies also offer services to U.S. exporters of agricultural products: the Economic Research Service, the Office of Transportation, the Animal and Plant Health Inspection Service, the Food Safety and Inspection Service, and the Federal Grain Inspection Service. A wide variety of other valuable programs is offered, such as promotion of U.S. farm products in foreign markets; services of commodity and marketing specialists in Washington, D.C.; trade fair exhibits; publications and information services; and financing programs. For more information on programs contact the director of the High-Value Product Services Division, Foreign Agricultural Service, U.S. Department of Agriculture, Washington, DC 20250; telephone 202-447-6343.

State Governments

State economic development agencies, departments of commerce, and other departments of state governments often provide valuable assistance to exporters. State export development programs are growing rapidly. In many areas, county and city economic development agencies also have export assistance programs. The aid offered by these groups typically includes the following:

Commercial Banks

More than 300 U.S. banks have international banking departments with specialists familiar with specific foreign countries and various types of commodities and transactions. These large banks, located in major U.S. cities, maintain correspondent relationships with smaller banks throughout the country. Larger banks also maintain correspondent relationships with banks in most foreign countries or operate their own overseas branches, providing a direct channel to foreign customers. International banking specialists are generally well informed about export matters, even in areas that fall outside the usual limits of international banking. If they are unable to provide direct guidance or assistance, they may be able to refer inquirers to other specialists who can. Banks frequently provide consultation and guidance free of charge to their clients, since they derive income primarily from loans to the exporter and from fees for special services. Many banks also have publications available to help exporters. These materials often cover particular countries and their business practices and can be a valuable tool for initial familiarization with foreign industry. Finally, large banks frequently conduct seminars and workshops on letters of credit, documentary collections, and other banking subjects of concern to exporters.

Among the many services a commercial bank may perform for its clients are the following:

Export Intermediaries

Export intermediaries are of many different types, ranging from giant international companies, many foreign owned, to highly specialized, small operations. They provide a multitude of services, such as performing market research, appointing overseas distributors or commission representatives, exhibiting a client's products at international trade shows, advertising, shipping, and arranging documentation. In short, the intermediary can often take full responsibility for the export end of the business, relieving the manufacturer of all the details except filling orders. Intermediaries may work simultaneously for a number of exporters on the basis of commissions, salary, or retainer plus commission. Some take title to the goods they handle, buying and selling in their own right. Products of a trading company's clients are often related, although the items usually are noncompetitive. One advantage of using an intermediary is that it can immediately make available marketing resources that a smaller firm would need years to develop on its own. Many export intermediaries also finance sales and extend credit, facilitating prompt payment to the exporter. For more information on using export intermediaries see Methods of Exporting and Channels of Distribution.

World Trade Centers and International Trade Clubs

Local or regional world trade centers and international trade clubs are composed of area business people who represent firms engaged in international trade and shipping, banks, forwarders, customs brokers, government agencies, and other service organizations involved in world trade. These organizations conduct educational programs on international business and organize promotional events to stimulate interest in world trade. Some 80 world trade centers or affiliated associations are located in major trading cities throughout the world. By participating in a local association, a company can receive valuable and timely advice on world markets and opportunities from business people who are already knowledgeable on virtually any facet of international business. Another important advantage of membership in a local world trade club is the availability of benefits such as services, discounts, and contacts in affiliated clubs from foreign countries.

Chambers of Commerce and Trade Associations

Many local chambers of commerce and major trade associations in the United States provide sophisticated and extensive services for members interested in exporting. Among these services are the following: In addition, some industry associations can supply detailed information on market demand for products in selected countries or refer members to export management companies. Most trade associations play an active role in lobbying for U.S. trade policies beneficial to their industries. Industry trade associations typically collect and maintain files on international trade news and trends affecting manufacturers. Often they publish articles and newsletters that include government research.

American Chambers of Commerce Abroad

A valuable and reliable source of market information in any foreign country is the local chapter of the American chamber of commerce. These organizations are knowledgeable about local trade opportunities, actual and potential competition, periods of maximum trade activity, and similar considerations.

American chambers of commerce abroad usually handle inquiries from any U.S. business. Detailed service, however, is ordinarily provided free of charge only for members of affiliated organizations. Some chambers have a set schedule of charges for services rendered to nonmembers. For contact information on American chambers in major foreign markets, see appendix IV.

International Trade Consultants and Other Advisers

International trade consultants can advise and assist a manufacturer on all aspects of foreign marketing. Trade consultants do not normally deal specifically with one product, although they may advise on product adaptation to a foreign market. They research domestic and foreign regulations and also assess commercial and political risk. They conduct foreign market research and establish contacts with foreign government agencies and other necessary resources, such as advertising companies, product service facilities, and local attorneys.

These consultants can locate and qualify foreign joint venture partners as well as conduct feasibility studies for the sale of manufacturing rights, the location and construction of manufacturing facilities, and the establishment of foreign branches. After sales agreements are completed, trade consultants can also ensure that follow-through is smooth and that any problems that arise are dealt with effectively. Trade consultants usually specialize by subject matter and by global area or country. For example, firms may specialize in high-technology exports to the Far East. Their consultants can advise on which agents or distributors are likely to be successful, what kinds of promotion are needed, who the competitors are, and how to deal with them. They are also knowledgeable about foreign government regulations, contract laws, and taxation. Some firms may be more specialized than others; for example, some may be thoroughly knowledgeable on legal aspects and taxation and less knowledgeable on marketing strategies.

Many large accounting firms, law firms, and specialized marketing firms provide international trade consulting services. When selecting a consulting firm, the exporter should pay particular attention to the experience and knowledge of the consultant who is in charge of its project. To find an appropriate firm, advice should be sought from other exporters and some of the other resources listed in this chapter, such as the Department of Commerce district office or local chamber of commerce.

Consultants are of greatest value to a firm that knows exactly what it wants. For this reason, and because private consultants are expensive, it pays to take full advantage of publicly funded sources of advice before hiring a consultant.

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