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In general, the SBA defines a ‘Small Business' as one having 500 or fewer employees. That being the case, the SBA/U.S. Census Bureau data show that during 2003, there were 5,750,201 ‘Small Businesses' in the United States . Of these 5.8 million businesses, only 230,736 exported goods (International Trade Administration, 2001), an embarrassingly dismal 4%. Despite the fact that small business exporters have more than doubled since 1992 (108,026 per SBA), there is still much room to grow in light of the trend of lowering trade barriers and tariffs, greater access to foreign markets, and more rapid delivery of products and services through globalization and internet communications.

The United States has run a Trade Deficit since 1975, the last year the U.S. enjoyed a Trade Surplus. The 2005 Trade Deficit of $725.8 billion was a 17.5% increase over 2004's mark, continuing a dangerous and growing trend. Rather than focus our attacks on China (which accounted for $201.6 billion of the total deficit) for not revaluing their currency, I suggest that an alternate solution to bringing down the Trade Deficit is a call to action of America 's economic strength – U.S. Small Businesses.

The average annual export sales of goods for the 230,736 small business exporters in 2003 was $780,000, resulting in total export sales of $182 billion. By increasing the number of small business exporting firms to 10% of the nation's total small businesses, coupled with just a 10% growth in export sales of current small business exporters, the Trade Deficit could be cut in half.

Many small business owners say the risks and costs of exporting are too high. According to a recent poll of small businesses conducted The Export-Import Bank of the United States (Ex-Im Bank), these business owners cited a major concern and impediment to exporting was ‘Getting Paid' by their foreign customers.

The good news: There are programs offered by Federal and State Governments to reduce the risk of loss when developing and growing small business' export sales. For example, Ex-Im Bank offers a ‘Small Business' Export Credit Insurance Policy for small business exporters that covers 95%- 100% of a loss to a foreign buyer when the foreign buyer does not pay the exporter's invoice. This policy is designed to encourage small businesses to export more, protecting their Export Accounts Receivable from loss due to foreign bankruptcies, insolvencies, currency inconvertibility, slow pay behavior, foreign government interference and a host of other perils that can cause a foreign customer to default on your export invoice. The cost is quite modest when compared with the high indemnity coverage – for exporters selling on payment terms of Cash Against Documents (CAD), the annual premium for $2,000,000 in annual export sales is only $4,800, about ¼ of 1%. For exporters who give longer payment terms of up to 60 days from shipment, the annual premium for the $2,000,000 in annual export sales is $13,000, about 2/3 of 1%. In addition, with an Export Credit Insurance Policy, bank lenders will include Export Accounts Receivable in your borrowing base if you need working capital financing to purchase raw materials and pay for labor that go into finished goods that are ultimately exported.

Yes, there is a solution to our growing Trade Deficit – educating and training the millions of U.S. Small Businesses about the tools and programs available to reduce risk of loss when expanding their sales to foreign markets. Profit margins and wages paid by U.S. companies that export are higher than those who sell only in the U.S. For more information on Export Credit Insurance, visit www.exim.gov

John R. Koch, CCE, is President of World Trade Consult, LLC, a St Charles, MO-based Trade Insurance Services provider. WorldTradeConsult is a Registered Broker with The Export-Import Bank of the United States . Mr. Koch can be reached at 636-922-9552 and contact form