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The impact that small businesses have on United States exporting is often underestimated, when it is considered at all. Did you know that 98 percent of all exporters are small businesses? And, small businesses account for 30 percent of the total value of goods exported? Plus, the number of small business exporters is growing. A 2013 study by the Small Business Exporters Association (SBEA) found a “notable increase in the number of small-business owners who report they export their goods and/or services” over the number who did so in 2010.
Why the interest in exporting? The biggest reason is the tremendous potential for new customers. According to the Small Business Administration (SBA), 95 percent of the world’s consumers live outside the United States and those non-U.S. consumers account for 66 percent of the world’s purchasing power. Although Canada remains the top destination country, China, India, Mexico and Brazil are also significant markets for U.S. exports, providing markets for a wide variety of goods and services.
While the lure of exporting is powerful, it is not an activity that a small business can undertake without serious preparation and commitment. In the SBEA study, nearly half of the small business exporters surveyed spent months, and over eight percent of their annual operating revenue, simply preparing to export. Yet, despite the time and expense of launching an export business, the resulting access to the vast international market can drive significant growth. Between 2005 and 2009—years that included the infamous financial collapse—small and midsize exporting businesses had revenue growth of 37 percent. In contrast, the total revenue of non-exporting businesses declined by seven percent during the same period, according a report issued by the U.S. International Trade Commission.
Given the potential upside, it is worth exploring whether exporting makes sense for your business. Here are five avenues that you can take to help with the process of exploration, preparation and implementation.
Exporting has proven to be a means to revenue growth for many small businesses. By taking the time to explore some of the options presented above, you will be able to determine if it is a path that you want to take as your business grows and expands.
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