The Small Business Administration is asking small business owners “where will your next customer come from?” AAC Enterprises, Inc. is finding them all over the world.  Justin Hartenstein started out selling automobile parts out of his garage, and now he designs and develops innovative custom lighting systems for car enthusiasts all around the globe.

Justin uses UPS TradeAbility® to obtain landed costs and UPS Paperless® invoice to electronically manage paperwork for international shipments, which make up about 20% of his sales.

Hartenstein entered SBA’s video contest and is sharing his exporting story.

If he wins – and I think he’s got a pretty good shot – he’ll win some cash and a trip to the National District Export Council Conference in Las Vegas. UPS is a sponsor of the November conference and plans to help other small businesses like AAC become more active in the global marketplace.

Boosting America’s exports strengthens our economic growth and supports millions of good, high-paying American jobs.  Although companies that export can make on average 9 to 12% more revenue than their peers, less than 1% of American companies sell their products in foreign markets.  Last year, President Obama recognized the importance of stimulating exports and set an aggressive goal of doubling U.S. exports in five years.  To achieve this goal, the President established the National Export Initiative. CEO Scott Davis was appointed to the President’s Export Council due to UPS’s ability to facilitate global supply chains for U.S. businesses.

Most business owners do not export because of a lack of knowledge and fear of the unknown.  To overcome these barriers and help companies expand globally, UPS is conducting a series of International Symposiums this fall. The next symposium in October will help small businesses develop an international expansion strategy.  Hear what participants had to say at a recent event held in downtown Los Angeles.

Through various roles at UPS, I’ve worked with companies for more than 13 years and the fears they have about doing business internationally are usually the same. Language differences, financial risks and terms of sale are just a few of the factors prohibiting competitive companies from taking advantage of the global marketplace.

The folks at Futurallia (Future + Alliance) have figured out how to minimize those fears and will assist hundreds of small businesses at its annual conference coming up in Kansas City – the first time in the U.S.  Don’t miss the opportunity to attend… registration ends May 13^th.

Think of it as matchmaking or speed dating. Over two days, companies from around the world get together in 30-minute sessions. For example, a widget seller from California can meet with widget buyers from Canada, China, and Chile all in one day!

The Obama Administration has turned to small businesses to help fulfill the President’s goal of doubling exports within 5 years under the National Export Initiative. Feeling like a small fish in a big sea, small businesses are looking for direction in overcoming export barriers and indentifying trustworthy trade partners.

Futurallia is the perfect venue to form those international partnerships. UPS will be there explaining how simple exporting can be – from logistics to international shipping solutions. UPS Capital will provide financial guidance, and the team from UPS Supply Chain Solutions will discuss how to move large freight shipments. The UPS Store will also be there offering shipping services for participants who want to send items back home.

And even before the conference begins, small businesses can review UPS market guides to gain insight from trade experts on opportunities in China, India and Mexico.

Be sure to check upside to see what’s going on at Futurallia. I’ll be there business dating.

Christopher Columbus had a global perspective when venturing half way across the world for international business. He set his sights on an emerging market and set sail, giving birth to ‘a whole new world.’ Lucky for us, conducting business in emerging markets in 2011 doesn’t have to be as gruelling as spending months at sea.

In Canada, small and medium-sized enterprises (SMEs) are becoming more global in their outlook on international business. Borderless business is becoming a reality for many, and an opportunity for all.   

A survey conducted by Angus Reid on behalf of UPS provided insights on Canadian SMEs opinions’ about emerging markets and highlighted some shifts in attitudes. Among the findings, 73% believe that Canadian businesses should put more resources into international trade. It was only last quarter in 2010 that many SMEs believed businesses should confine their commerce within Canada in order to sustain the country’s competitiveness, and more than half stated Canada should establish tariffs to discourage overseas exporters from accessing the Canadian market. These shifts in attitude can fuel Canada’s potential as a forerunner in global trade.

The survey showed that there are still some SMEs that believe they can’t compete with counterparts in emerging markets such as China, India and Brazil. Coincidentally, some feel strongly towards the trade agreement currently being negotiated between Canada and the EU. The belief is that this partnership would be valuable because there is demand for Canadian goods on the other side of the pond, and because European economies are likely to bounce back from the recession soon. It seems that confidence is limited to certain parts of the world. 

Yet, many still associate the fate of Canada’s export sector with its traditional U.S. trading partner, with the belief that a rebound in Canadian exports will hinge on U.S. consumer confidence. 

Sitting at the observation deck, it’s interesting to note that certain global partnerships are more favourable than others. Should there really be a reason to refrain from venturing out in emerging markets and possibly realizing borderless success? Should a growing SME not be willing to take risks to break into an emerging market?

Explore your options. Set your course. Sail towards success.

We have a winner!  Recently, UPS launched its inaugural “Growth through Global Trade Award” to recognize small- and medium-sized businesses (SMBs) that are excelling in international trade.   

The entries were narrowed down to five finalists who were considered by the judging panel on the following criteria:

• Growth of international sales and/or business operations
• An entrepreneurial spirit and innovative pursuit of international growth opportunities
• Ambitious plans to continue growing the company through exporting

By unanimous decision, SteelMaster Buildings was picked as the winner of the award. SteelMaster Buildings is a manufacturer, designer and supplier of arched steel structures.

The decision was one the judges made quickly and with ease. Below is a snapshot of what sets SteelMaster Buildings apart from the rest of the contestants:

• Since the company began exporting in 2006, the company’s revenue has quadrupled and now represents 15 percent of the company’s total revenue, and continues to grow.
• SteelMaster Buildings exports to over 40 countries and has distributorship relationships in more than 50 international markets.
• The website:
  • User friendly, offers bi-lingual choice for spanish speaking viewers
  • Live chat availabile
• The buildings are environmentally friendly and can be recycled. SteelMaster Buildings offer green buildings made with Galvalume Plus coatings that protect against non-uniform weathering and reduce energy loads on buildings due to a long-term, bright surface that helps heat reflectivity. SteelMaster Buildings Galvalume Plus coating maintains the EPA solar reflectance requirement of 0.65 on newly -manufactured buildings and the minimum of 0.50 on roofs over three years for age. Galvalume Plus coated steel has been approved by the ENERGY STAR program, both for low-slope and high-slope applications.
• The product is one that can be easily utilized in the wake of natural disasters, such as earthquakes, flooding or hurricanes. SteelMasters Buildings has participated in humanitarian relief efforts, specifically in Haiti.

The winner was profiled with a feature article in World Trade 100 magazine, as well as a highlighted on the UPS Pressroom.

UPS Chief Operating Officer David Abney recently spoke to a group of business leaders in San Diego, delivering his own version of the Discovery Channel show “Mythbusters” about global trade.

In his remarks, the UPS chief operating officer addressed increasingly negative perceptions in the United States about trade, focusing on three myths.

Myth #1: trade costs U.S. jobs.

David discussed the long-term trend of automation and technology driving gains in productivity but declines in factory employment, especially repetitive tasks, and he cited research supporting this point. “What’s confusing is that manufacturing employment is down in this country, and we assume it’s because jobs are leaving the United States,” he said.

 “The reality is that most of the lost jobs didn’t go offshore—they disappeared. Many businesses need fewer workers because they use newer technologies. They must invest in new equipment and processes to improve productivity and to compete globally. Over time, businesses have swapped brawn for brains—a tradeoff that causes friction in the short term but boosts our productivity and standard of living in the long run.”

David said the key to adjusting is education and training, and he noted that an important skill in today’s economy is supply chain management. “Businesses need a diverse network of suppliers and flexibility to move goods and parts, often across international borders. New capabilities in logistics make this chain more efficient and productive, and these improvements can be a game changer for global businesses.”

Myth #2: U.S. businesses can’t compete globally.

David said U.S. businesses lead the world in innovation and entrepreneurism, especially in business services. Future success should involve building on these strengths and evolving to meet global customer needs.

“It’s true that many commodity products are made in places with low labor costs. Wage arbitrage is a factor in our global economy. But wages are only a portion of production costs, especially when you’re adding value. The secret sauce for adding value – the goal of most smart businesses – is innovation. And when you add reputation and branding, you establish pricing power.”

Looking in the rearview mirror, David added, is no way to win a high speed race of global competition. “If we worry too much about protecting the jobs of the past, we may miss the opportunity to nurture the industries of the future.”

Myth #3: the U.S. market is big enough for future business growth.

David noted emerging opportunities in global markets and urged U.S. businesses to increase exports, taking advantage of new logistics capabilities to reach a huge wave of new consumers.

“Less than 4 percent of small and medium sized U.S. businesses export – that’s far less than in other countries,” he said. “For instance, in Germany about half the small and medium-sized businesses export. And, what protectionists don’t tell you is that 95 percent of the world’s customers live outside the United States.”

His points are supported by a recent report to the U.S. President on the National Export Initiative, in which the White House proposes doubling U.S. exports over the next five years.

David closed his speech with this assertion: “Global trade may well be the most important and vital component of any serious effort to get our economy up and running again. The future of business isn’t threatened by global trade—it actually depends on it.”

UPS Chairman and CEO Scott Davis and Secretary of Commerce Gary Locke co-authored an opinion piece published by the U.S. Department of Commerce’s blog.

Robust and global trade drives the world’s economic engine. And it’s the quickest and surest way we know to accelerate economic growth, create new jobs and improve living standards. 

Now we freely admit that UPS has an interest here. At any given moment, UPS handles 6 percent of the U.S. GDP and moves 2 percent of the global GDP. So global trade is important to the future of UPS, and that holds true for its workers, and for workers across America. Every 22 packages per day that cross a border supports one job in UPS’s package operation.

That’s why UPS is so supportive of President Obama’s recent announcement of a landmark trade deal with South Korea, which is estimated to increase American economic output by more than the last nine trade agreements combined.

UPS’s logistics and lending services empower businesses of all sizes to export their goods and services virtually anywhere in the world, and with the impending passage of this agreement, there will be a lot more businesses to work with. 

The tariff reductions in this deal alone are expected to boost annual exports of American goods by up to $11 billion, supporting at least 70,000 Americans jobs. And an array of American industries will benefit from this deal.

The service sector is a great example – an area where America is a global leader. This agreement will open Korea’s $560 billion services market to more American companies, supporting additional jobs for American workers in sectors ranging from express delivery to engineering to legal and accounting services to education and health care.

American manufacturers and workers also will gain enhanced access to the Korean market and a level playing field to take advantage of that access. 

Under the agreement, Korea will immediately cut in half its tariffs on U.S. auto exports, creating more job-creating export opportunities for U.S. car and truck manufacturers and workers.

The National Association of Manufacturers reports that manufacturing exports to Korea supported 230,000 American jobs in 2008. The reduction of Korea’s tariffs on American manufactured goods is expected to boost this sector’s exports and related jobs even further.

And American farmers and ranchers could see their exports to Korea increase by as much as $1.8 billion every year under the U.S.-Korea trade agreement.

Agreements like this are a major step forward in efforts to create and support jobs for American workers and to ensure that the United States remains competitive in the 21st century.

In the months ahead, UPS will be working with the administration’s trade experts at USTR and the U.S. Commerce Department to ensure that U.S. businesses can reap the full benefits of this agreement.

This is a big win for the American economy, for American businesses and for its workers.

Robust and open global trade drives the world’s economic engine, Scott Davis said in a keynote speech to the America’s Competitiveness Forum Nov. 15 in Atlanta. “Everyone wins when trade flows freely,” he said to a room packed with about 1,000 international business and government leaders including the vice presidents of Colombia, the Dominican Republic, Panama and Costa Rica.

In his remarks, Scott Davis challenged officials to knock down trade barriers and clear the way for more exports as a driver of global economic growth and prosperity. He said the United States should mend fraying ties with both NAFTA trading partners, Canada and Mexico.

And he called for the United States to pass stalled trade agreements with South Korea, Colombia, and Panama. Davis cited statistics from the United States Chamber of Commerce that said that failure to pass these agreements on the table would cost the United States 380,000 jobs—at a time of 9.6 unemployment. “Does that make any sense?” he asked.

“Sadly, when it comes to trade, our elected leaders seem to be following their hearts more than their heads. In the halls of Congress, compelling arguments for trade get overwhelmed by noisy and heated attacked on globalization.” But he added, with the election over, he’s hopeful that “cooler heads would prevail” and trade deals would move forward.

Davis was introduced by Francisco Sanchez, United States Undersecretary of Commerce for International Trade.  Also attending the forum was U.S. Commerce Secretary Gary Locke who serves with Davis on the President’s Export Council.

The U.S. Commerce Department hosts the Americas Competiveness Forum each year with the aim of building commercial ties among the economies and markets of the Western hemisphere. After his speech, in response to a question, Davis said he was “very bullish” on Latin America and that UPS is continuing to expand its presence in the growing economic region to meet rising demand. Several Latin American and Caribbean nations have signed trade agreements that have boosted growth and commerce, he added.

Davis also mentioned the benefits of working with the U.S. Commercial Service, a U.S. Commerce Department office that helps U.S. businesses export and increase sales in global markets.

An example of a UPS customer that is leveraging the power of new logistics is Jurlique, a maker of high-end skin- and hair-care products based in Australia. In the past, the company absorbed a high cost of doing business in Europe because of air freight shipping expenses and warehouse costs in London.

UPS helped Jurlique streamline its supply chain by consolidating its distribution operations for the United States, Canada and Europe. These distribution facilities are now located in a 7,000-square-foot warehouse space in Atlanta.

By leveraging new logistics capabilities, Jurlique cut shipping costs by an estimated $60,000 per year. Their solution was to piggyback European inventory onto U.S.-bound ocean shipping containers. This logistics adjustment eliminated its London warehouse, saving approximately $7,000 to $8,000 per month. And it reduced customs brokerage expenses and border delays by using UPS World Ease to consolidate international shipments.

The success of Jurlique illustrates Davis’ larger point in his ACF speech about the importance of trade and logistics. “With improved capabilities and electronic customs, shipments can more seamlessly and swiftly around the global and at lower cost.  But trade-friendly rules have to be in place. The bottom line is this: When global commerce suffers, we all suffer and end up paying a price.”

Did you know that 95% of the world’s consumers live outside the U.S., and yet only 3.9% of the 29 million small businesses in America are exporting? I spent several years at UPS working in our international operations and customs brokerage group, so I understand how a company that has never done business outside the U.S. might be intimidated by all the paperwork, customs regulations and other potential obstacles.

That’s one of the reasons UPS is hosting a special webcast at The New York Times on Wednesday, Nov. 10, at 12:00 p.m. EST. Titled “New Logistics & Exporting: How Your Business Can Benefit,” the webcast will offer insights and guidance for companies that are thinking about taking their business global.

The webcast will be moderated by Michael Rogers, author and “futurist in residence” at The New York Times. Serving on the speakers’ panel will be Matt Eckert, vice president of Hypoxico (a fascinating company that designs and manufactures high altitude training equipment); Daniel O’Brien, deputy national director of the U.S. and Foreign Commercial Service, and Dan Brutto, president of UPS International. The webinar is free.

Coming off the heels of the worst economic recession in decades, exporting is our best bet for producing new opportunities for growth and prosperity. The middle class in countries like India and China are growing fast and they’re becoming more affluent every year. They also have a strong desire for American products. But that won’t be of much benefit to U.S. businesses unless they’re willing to take that first step.

There is an incredible amount of information and support available to help even the smallest company reap the benefits of exporting, and the UPS webcast is a good place to get started. To register, visit newlogisticswebcast.com.

Lack of interest and investment despite countless opportunities overseas

Newly-released data shows that small to medium-sized enterprises (SMEs) are still hesitant to engage in international trade, despite the vast opportunities in the worldwide marketplace.

In part two of its three-part series to study SMEs’ global trade habits and attitudes, the survey, commissioned by UPS Canada, revealed that 52 per cent of SMEs would not take advantage of a free-trade deal with the EU — not because it’s with the EU, but because they have no interest in engaging in trade activity at all.

UPS Canada President Mike Tierney said the results are not surprising, but do present a concern about the future economic competitiveness of Canada’s businesses. “Given the turmoil taking place in the U.S. and European markets and much talk about the possibility of a double-dip recession, it’s understandable that many SMEs are reluctant to invest in expanding their enterprise beyond Canada,” said Tierney. “However, it’s very important that Canadian SMEs realize that in order to remain relevant and competitive in the future, they should leverage the economic opportunities emerging in overseas markets.”

Despite consistent encouragement to go global, the survey found that 61 per cent of SMEs would not be willing to invest – at all – to take their business beyond Canada. Just more than a quarter would only be willing to invest less than 20 per cent of their business capital.

In addition, almost 40 per cent of respondents believe that businesses should confine their commerce within Canada in order to sustain the country’s currently strong level of competitiveness. The numbers do not bode well for Canada’s growing trade deficit, which currently stands at record levels.

Tierney said he empathizes with the struggles that many businesses go through when it comes to expanding their businesses and notes that entrepreneurs are often discouraged from investing because they mistakenly believe they have to make massive investments into their own proprietary supply chain infrastructure.

“It’s important that SMEs understand that as Canadian businesses they are currently in a very competitive position to enter the global market,” said Tierney. “There are many organizations, such as UPS, that can provide resources to help them identify new, strategic markets, plan strong supply chains and realize cost efficiencies that will expand the profit margins of their global commerce.”

The survey was commissioned by UPS Canada and completed by Leger Marketing. It was conducted among a random sample of 300 small business respondents across Canada between August 31 and September 13, 2010. This method simulates a probability sample, which would yield a maximum margin of error of +\-5.7%, 19 times out of 20.

The full second survey is posted on the UPS Pressroom website. The first survey, conducted in June 2010, is also available. Stay tuned for survey three, which will be available in November.