Welcome to "A Basic Guide to Exporting". an overview of the fundamentals in exporting, designed for small to medium sized companies who are considering finding new market segments overseas. This first article in the series provides a list of total U.S. annual exports 2010-2014 and discusses the different channels to consider when trading cross-borders. This information is provided by the U.S. Commercial Service.

The World Is Open for Business—Your Business

Today, it’s easier than ever for a company like yours, regardless of size, to sell goods and services across the globe. Small and medium-sized companies in the United States are exporting more than ever before. In 2013, more than 300,000 small and medium-sized U.S. companies exported to at least one international market—nearly 28 percent more than in 2005, the year in which the 10th Edition of this book was first published. In 2013, the value of goods and services exports was an impressive $2.28 trillion, nearly a 25 percent increase since 2010. And 2014 topped the previous year, with exports valued at $2.34 trillion.
 

 

 

Additional Reasons to Explore or Expand Exporting

Global trade in goods and services is likely to grow in the future. The new World Trade Agreement on trade facilitation that was introduced at the end of 2013 and renegotiated in 2014 will reportedly add $1 trillion to the global gross domestic product (GDP) once it is fully implemented. This agreement compels the World Trade Organization (WTO) members to improve customs procedures and cut regulatory red tape, speeding the flow of goods and services across borders and reducing the costs involved. The U.S. government will create a “single window” system that has some of the same benefits and efficiencies as the WTO effort.

The United States is in an advanced stage of negotiating trade agreements with the European Union and countries in the Asia-Pacific region, including the large market of Japan. Together, these markets represent 50 percent of total global GDP and 30 percent of global trade. These agreements, if ratified, will join agreements already in place, including the North American Free Trade Agreement (NAFTA) and the Central America and Dominican Republic Free Trade Agreement (CAFTA-DR). More than reducing the duties on imported goods by member countries and thus making these products cheaper for consumers, the agreements also generate additional business opportunities by strengthening intellectual property protections, simplifying regulations, opening up the service sectors and government contracting procedures, and generally treating foreign companies the same as domestic companies.

If you have a web presence, you have a global marketing and order-taking platform. For a few more dollars, you can process credit card payments for buyers in Australia or translate key pages into Spanish and other languages to further your reach. During the next few years, worldwide B2C e-commerce is projected to nearly double to  $2.2 trillion with the fastest growth in the Asia-Pacific. You’ll want to be in the game as sales soar.

US Total Annual Exports (US Trillions, 2010-14)

Year

Value

Increase %

2009

1.570

 

2010

1.831

16.6%

2011 

2.103

14.9

2012

2.216

5.4

2013

2.280

2.9

2014

2.345

2.9

Source US Census Bureau

Do You Want More Sales Channels?

Online B2B and B2C marketplaces offer virtual storefronts and a ready-made global army of shoppers. They also offer payment solutions, and you can choose a shipper that will take care of the required documentation for you. The shippers want to help make things easier too, and many offer international business advice, freight forwarding and customs brokerage services, cost calculators, and in some cases, financing. Plus, they’ll pick up goods and documents from your back door and deliver them to almost any address in the world. And you can track everything on their website. Some e-commerce platforms will arrange to ship your goods to one or more of their fulfillment warehouses located in major commercial centers around the world. As items are sold and shipped quickly to buyers, you can restock the goods by sending larger quantities to the fulfillment centers, generally at less cost than shipping one item at a time from your place of business in the United States.

Want even more sales channels? If web-based marketing and sales are insufficient to meet your sales growth appetite, you can attend trade shows in the United States where buyers from around the world come to purchase U.S. goods and services. Show organizers will facilitate introductions to the buyers, working with agencies of the U.S. government to provide matchmaking services on the show floor. These same government agencies can arrange for you to attend shows in other countries, where the connections and influence of your embassy network can save you time and money generating new business. Government agencies can find buyers for you and arrange introductions in more than 100 countries. Call this service “customized business matchmaking.” 

Channels can include:

- Direct to end-user
- Distributors in country
- Supplier to the U.S. government in a foreign country
- Your e-commerce website
- A third-party e-commerce platform where you handle fulfillment
- A third-party e-commerce where they handle fulfillment
- Supplier to a large U.S. company with international sale
- Franchise your business. 

You are not limited to one of these channels. Today’s global trading system is ideal for the smaller company employing more than one marketing and sales channel to sell into multiple overseas markets. But most U.S. exporters currently sell to one country market—Canada, for example. And the smaller the company, the less likely it is to export to more than one country. For example, 60 percent of all exporters with fewer than 19 employees sold to one country market in 2005.