Exploring the global business frontier

0514Exploring-new

Regional organizations enhancing resources to help firms enter world market

Story by Robin Driessen Bruecker

With the Wisconsin Economic Development Corp. reporting big bucks are being made in the state from exports, it makes sense for companies to investigate international markets.

Wisconsin exports to Canada, Mexico and China have reached billions of dollars, with Japan and Germany not far behind. Growth has been steady in recent years, but the state Department of Agriculture, Trade and Consumer Protection reported Wisconsin exports, which totaled $23 billion in 2013, fell just two-tenths of a percent when compared to 2012.

Experts say global opportunities are plentiful. But for companies who have never ventured outside the U.S., getting started can be daunting. There are numerous resources around northeast Wisconsin ready to provide guidance.

Laying the ground work

Global New North, a partnership of De Pere-based New North Inc., as well as regional and state economic development organizations, wants to help.

“Global New North came about as a consequence of some critical [Economic Development Administration] funding that purchased some market research that matched our regional market strengths to qualified targeted offshore markets,” explained Jerry Murphy, executive director of New North.

Involved in landing the EDA grant was a joint application from East Central Wisconsin Regional Planning Commission and Bay Lake Regional Planning Commission – which together cover all New North counties. Together they chose a global trade study as the grant’s activity.

Waupaca County Economic Development Corp., which organized a trade mission to Mexico in 2009 in partnership with the Northeast Wisconsin Regional Economic Partnership, Northeast Wisconsin Technical College and the Green Bay Chamber of Commerce, also was actively involved with the grant and the subsequent study.

“WCEDC was looking for opportunities for NEWREP to re-engage in international business development when the EDA grant opportunity came to light,” said Dave Thiel, executive director of the Waupaca County’s EDC and co-chair of Global New North.

A 2012 global trade study examined how much New North businesses knew about doing business globally.

“We found that most of the businesses were concerned that selling their products and/or services abroad would be extremely complicated,” said Thiel. “They were also unfamiliar with the multitude of resources available to help them get started in foreign markets.”

He said businesses already exporting generally fell into two categories.

“First, there were the large businesses that had strategic plans in place for international business, as well as dedicated staff to executing those plans,” Thiel said. “Secondly, there were the small- or medium-sized businesses that had been pulled into exporting via their websites or associations with other businesses who did business internationally. The global trade study and subsequent implementation is concentrating on helping (small and medium companies) get into the world of international business, or expand the number of markets they currently sell in.”

Murphy said the partnership working on the initiative is committed to increasing the number of exporters and export trade volume from the region by 50 percent over time.

“This will take a few years, but we feel confident that the opportunities in exporting are simply too strong to leave on the table,” he said.

Exporting 101

Developing a comfort level with the technical aspects of offshore markets is important.

“With that acquired level of comfort, (exporters) also look for domestic and in-country resources to identify prospective customers, and to build strong relationships with them,” Murphy said. “Export strategies need good intelligence about what the region has to market, and equally good intelligence about offshore markets to pursue. Strategy also needs structure, tactical measures, outcomes and long-term objectives.”

Northeast Wisconsin businesses can get training and advice from the Northeast Wisconsin International Business Network, which was created as a result of the global trade study. Besides networking, NEWIBN offers a speaker series focusing on global commerce themes plus discussions of global business operations, trade issues and markets.

Dean Stewart, dean of corporate training and economic development at NWTC, noted the trade study’s goals included increasing economic development assistance for new exporters; monitoring the global trade initiative’s effectiveness; and creating a clearinghouse of current international market data analysis, trends, and so on.

To put the goals into action, the region’s technical colleges banded together to provide networking for local businesses. First came Lakeshore Technical College’s LINKe network, followed by NEW International Business Network at Fox Valley Technical College.

“Six months after FVTC started NEWIBN, we at NWTC decided to join forces with FVTC to form a larger, more-encompassing organization to meet the needs of business across the Fox Valley, Green Bay and Shawano, Marinette, Kewaunee, Oconto, Florence and Door counties,” said Stewart. NEWIBN meets twice a year at FVTC and twice at NWTC, with attendance ranging between 40 and 50 people.

Stewart said 96 percent of the world’s population lives outside the U.S.

“This fact alone proves that a huge opportunity exists for manufacturing companies and service organizations to enter emerging markets,” he said.

Stewart said the recent recession had a profound impact on everyone, and encouraged companies to consider new groundbreaking ways for expansion of product lines and markets. NWTC provides local companies with assistance through NEWIBN; global business workshops and seminars; technical consulting; and a global business certificate program, he said.

NEWIBN’s mission is to be led and driven by the private-sector businesses engaged in exporting and international trade, said Nancy Peters, global training and marketing coordinator for FVTC.

“We work closely with the Global New North and the Wisconsin Economic Development Corp. and other agencies and entities – all working collaboratively to organize and promote each other’s events,” Peters said. “The college offers customized corporate training and translation services, plus seminars on topics such as working across cultures; Chinese for business; compliance; logistics; U.S./Wisconsin role in the global economy; and so forth.”

Experts say there are plenty of resources to tap if considering exporting but don’t know where to start.

“A business from northeast Wisconsin that has never been involved with international business could attend a seminar sponsored by international business networking groups that have been developed by the four technical colleges throughout the region,” Thiel said.

If a business wanted to develop a strategic marketing plan for international business, the Wisconsin Economic Development Corp. offers a program called ExporTech, in conjunction with the Wisconsin Manufacturing Extension Partnership, Thiel said. ExporTech is geared toward high-level company executives and the fee is partially covered by the WEDC. Beginning this year, Global New North will partner with the WEDC on annual trade ventures outside the U.S.

Voices of experience

For more than 50 years, FEECO International Inc. in Green Bay has exported American-made bulk-material equipment for waste products to Africa, Australia and Asia, among other areas.

“Most recently, we had a Malaysian customer from over 25 years ago place a substantial order of replacement parts for their FEECO plant that was still in operation,” said Brian Madigan, who does process sales and business development for the company. “Simply put, if FEECO did not export we would be sacrificing sales.”

The U.S. dollar’s fluctuating value, higher shipping costs, language barriers, and competition from fabricators in developing countries have been some of the challenges that FEECO deals with, Madigan noted.

“The challenges facing FEECO are constantly evolving, forcing FEECO to not only be reactive but to anticipate upcoming changes,” he explained. “FEECO must always strive to communicate our strengths in innovation, our superior fabrication and design, and our commitment to long-term mutually beneficial relationships with our customers.”

FEECO’s business success positively impacts other local companies, which provide sub-components, fasteners, machining and more. “These casual partnerships lead to shared economic success,” said Madigan.

Another exporter with decades of international sales is Appvion Inc. in Appleton, which has customers in nearly 70 countries, mainly in Latin America and increasingly in Europe and Asia Pacific. The former Appleton Papers exports thermal and security, carbonless, and specialty coated products.

Among the exporting challenges faced by Appvion are the company’s orientation toward North America, limited familiarity with certain international markets, the preference of some international customers for local suppliers, price competition, currency fluctuations, distribution issues in some markets, and political turmoil, said Bill Van Den Brandt, senior manager of corporate communications.

“Some of these economic challenges are beyond our control,” he said. “We focus on what we can control and that starts with having a clear understanding of what our customers expect from us and then consistently meeting those expectations. That means providing consistent product quality because the cost and time to address errors are magnified in international markets.”

Appvion strives to tailor product innovation to specific customers, Van Den Brandt said.

“For example, we are one of the world’s leading producers of thermal paper used to produce tickets for lotteries throughout the world,” he said. “While all thermal paper images through the heat produced by thermal printing, we produce lottery products that have different sensitivity, durability and printability features that can be used for specific regional needs.”

Van Den Brandt said Appvion has a strong international sales team with local presence and knowledge of specific market needs, culture, language and growth opportunities.

“Also contributing to Appvion’s exporting success are a strong distribution network, strong relationships with shipping lines, and a good logistics team,” he said.

Appvion saw long ago that demand for its products doesn’t end at the U.S. border.

“We see the world as full of business opportunities and capturing those opportunities is a key element of our growth plan,” he said. “A strong and growing Appvion benefits our employees, our customers, our suppliers and the communities in which we have operations.”

Navigating export seas

Oshkosh Corp., which has annual export sales of $1.6 billion, exports products such as fire trucks, defense vehicles, and refuse, mixer and maintenance trucks.

“Exporting creates diverse markets for our products,” said Nancy Ebben, director of international finance for the Oshkosh-based maker of military vehicles and other heavy duty trucks. “When the U.S. market is down, we can sell into emerging and developed markets across the globe to offset the domestic downturn.”

When dealing with the overseas business challenges, Ebben said, “You have to be patient and flexible while trying to increase sales, mitigate risks, and still make money.”

Sue Hahn, who works in international sales for EuroPharma Inc. in Green Bay, said the company has expanded into Singapore, the Dutch Antilles and the Channel Islands, and is negotiating elsewhere.

EuroPharma has taken advantage of exporting services from NEWIBN, the WEDC and ExporTech.

“Within the exporting world, all companies have basic challenges – researching the right country, finding the right partner for the company – one that has the same philosophy and ethics – as well as the time frame of closing the deal and the actual shipment of product,” said Hahn. “The average timeline is 18 to 24 months and possibly longer.”

Don’t be afraid to venture out globally is her advice to other regional businesses.

“Wisconsin is a cornucopia of programs. Utilize them – all of them. One thing to remember, do your homework – on the country, the potential partner and the culture,” Hahn said.

Being an international traveler as a young man led Daniel Schwarz, president of Dan’s Fish Inc. in Sturgeon Bay, to partner with a professor in Finland to produce the first commercially-sold caviar from the Great Lakes. Financing was one of his first challenges, and a $35,000 grant from the state helped get the ball rolling. Over a 20-year period other challenges have ranged from export regulations that keep changing, to finding reliable overseas partners, to funding the needs of a growing company.

Schwarz credited government export programs and good employees with helping him navigate the export seas.

“I would say the greatest success is to produce a quality product that you can be proud of and find it across the ocean being served as a highly valued delicacy in grocery stores, restaurants and in everyday home cuisine,” he said.

For companies thinking about getting into exporting, Schwarz said, “Take the leap. Exporting can be challenging but can also be very rewarding. There is a lot of opportunity around the world, so take advantage of it.”

Robin Bruecker (robinbrueck@yahoo.com) has been writing for magazines and marketing departments since 1995.