Finding gold in global sales

By Anne Field / chicagobusiness.com

For Arnon Rosan, it's been a constant challenge. Mr. Rosan, chief executive of a New York company that sells flooring and fencing for special events, made a big push into exports starting about five years ago. But finding distributors to sell his products hasn't been easy. His 50-employee company, Signature Fencing and Flooring Systems, went through several dealers in the U.K. and South Africa before he found partners he considered reliable enough to trust with an exclusive contract for the regions.

EXPORTS PUSH: Arnon Rosan found overseas markets for his fencing and flooring products.

“We've learned not to OK these agreements until they've proved to us they can deliver the sales,” he said.

Despite the headaches, his persistence has paid off. Thanks to these and other efforts, revenues for 2010 were around $40 million, up from close to $30 million the year before.

For an increasing number of small business owners, there's gold in global sales. With growth in the U.S. lackluster, the obvious place to look for increased revenues is other countries.

“If you're only operating domestically, it's like leaving money on the table,” said Carmela Mammas, director of the New York U.S. Export Assistance Center. “Exporting means new revenue streams.”

Certainly, small companies face a host of obstacles to exporting, from pinpointing the right markets to adapting their products to the requirements of different countries. Many companies simply don't know how to get started. Close to 40% of respondents to a recent survey by the National Small Business Assn. and the Small Business Exporters Assn. said they haven't gone global because they lack the necessary information to do so.

But thanks to the global reach of the Internet and a major government push through the National Export Initiative, aimed particularly at helping small businesses, international expansion has become more doable than ever for small and midsize firms.

Smaller companies jump in

For many companies, the easiest way to start exporting is by targeting a familiar region where there's no language barrier. That's one reason why the two top countries for small business exports are Canada and the U.K., according to the NSBA/ SBEA survey.

When Mr. Rosan started exporting, for example, his first step was into the U.K., then Western Europe. Both language and infrastructure considerations played a part in that decision.

“They already had stadiums, plenty of golf tournaments and the like,” said Mr. Rosan. More recently, he's moved into other countries in Eastern Europe and the Middle East, as well as India, where there's a push to build more facilities. Mr. Rosan works through distributors, who help navigate regulations and other red tape overseas.

Having a strong Web presence also is essential. That's been the case for Urban Green Energy, a 90-employee Manhattan seller of small wind turbines, with $2.5 million in sales last year. In less than two years, it has entered 47 countries, from Australia to Lebanon.

“We started selling overseas as soon as we started up,” says Nick Blitterswyk, the chief executive.

All of Urban Green Energy's distributors contacted the company through its website, which has a Spanish translation option. The results of its exporting efforts have been promising overall, although it has experienced the disappointment of shipping two turbines to a Spanish architectural firm that never paid for them and stopped returning e-mails.

The company projects $12 million in sales this year, with the increase coming mainly from overseas business.

Perhaps the most efficient way for Chicago small businesses to target a country and find distributors or sales reps is through the U.S. Commercial Service, which has an office in Chicago. Relying on a global network of country and industry specialists in about 80 countries, the agency's Gold Key Matching Service helps entrepreneurs research possible markets, vets potential distributors and other partners and makes appointments with them in their home country for a $600 fee.

For companies that don't have the resources to travel or aren't interested in such an elaborate program, the U.S. Commercial Service will simply send a report with prequalified partners. Case in point: RMP Travel. The 23-year-old New York company started hosting tours for international visitors back in 1991 and now earns 60% of its $4.5 million in revenues from such business.

When RMP decided about a year and a half ago to expand to Argentina and Brazil, it opted to tap the agency's services rather than go it alone, according to Nick Calderazzo, vice-president of sales and marketing.

Over a period of a week or so, Mr. Calderazzo met with about 50 tour operators and other potential partners, eventually striking deals with 10.

“If I'd had to do it myself, it would have taken me quite a while to complete that research,” he said.