Small Businesses Exporting Products

By George C. Ford The Gazette, Cedar Rapids, Iowa

WWR Article Summary (tl;dr)  Help is available for women in business who are considering exporting their products overseas. The U.S. Commercial Service, a division of the U.S. Department of Commerce, has 100 offices in U.S. embassies around the world that can provide services to potential exporters. Patricia Cook, director of the Des Moines, Iowa office says that if someone is looking for a distributor she can put them on a toll-free conference call with a U.S. embassy trade specialist. It could take just weeks for the owner of a small business to travel to a specific country, meet with a distributor and get their product on the shelves.

IOWA CITY

When Anna Sobaski launched Breads From Anna in 2004 after she was diagnosed with celiac disease, word spread fairly quickly on the Internet about the Iowa City company that develops and sells gluten- and allergen-free baking mixes.

"We have received requests from all over the world from the very beginning," Sobaski said. "I've always been willing to ship directly to individuals."

A number of Iowa small businesses are exploring international markets for their products and achieving success in places such as Dubai, England and New Zealand.

Businesses with fewer than 500 employees accounted for 83 percent of the 3,420 companies that exported from Iowa in 2013, the most recent year for which figures are available, according to the U.S. Department of Commerce International Trade Administration. Iowa companies exported $13.1 billion of merchandise in 2015.

"Around 2006 or 2007, I started shipping to a distributor in New Zealand," Sobaski recalled. "There's a lot of need for gluten-free foods in New Zealand and a lot of awareness about celiac disease in that part of the world. That was my first big international shipment -- two pallets."

A woman with celiac disease in Dubai searching the Internet for gluten-free food brought Sobaski's company the opportunity to market her products in the Middle East.

"We started by shipping our 25-pound bulk bags to a warehouse in Queens, N.Y.," Sobaski said. "All of a sudden, she sent me an email asking if we could ship pallets of our products to Dubai. It involved a lot of paperwork, but we did it.

"We've been shipping to her for four or five years. She is closing her Dubai location, moving to Germany and opening multiple locations there."

Sobaski said her company is in discussions with a Spanish distributor that focuses on allergen-free foods for grocery stores and food service. That distributor already has initial approval for Breads From Anna products in the school systems in Spain.

The logistics of exporting "takes effort on both sides to make it happen," she said. "When we wanted to ship product to our distributor in Dubai, we had to get a certificate of origin from the Iowa City Area Chamber of Commerce and a certificate of health from the state.

"Our distributor had all the labels translated, and we applied them to all the products. We also had to apply additional stamping on all the bags to meet her inspector's specifications."

House calls When Freda and Jim Sojka, owners of Simply Soothing in Columbus Junction, were initially approached by a potential international distributor for their popular Bug Soother insect repellent, exporting was not on their agenda.

"Jim and I made up a concentrate last spring for a fellow in Scotland who had been bugging us for about three years," Freda said. "He had spotted a story about us on Yahoo.com and wanted to know if he could buy it in Scotland. We couldn't make Bug Soother fast enough and we told him that we didn't have time to get anything ready for Scotland.

"We ship it to him in a concentrate and he dilutes it down. He fills the bottles and puts a label on them."

With an eye toward additional overseas markets, the Sojkas met with additional distributors during a trade mission to London.

"We had a lot of interest from all over the world, but it's so tough to get that set up," Freda said, referring to the numerous regulations that need to be met.

Patricia Cook, director of the U.S. Commercial Service office in Des Moines, said small business owners considering exporting their products can take advantage of services offered by the federal agency.

"They need to go to a few fully identified official classes so they will not get ripped off and waste a ton of time," Cook said.

"There are free resources at the state and federal level in all 50 states."

Classes are offered three to six times each year for a startup or small business, Cook said. Most of the partners at the state and federal level who do the training also make "house calls," she added.

The U.S. Commercial Service, a division of the U.S. Department of Commerce, has 100 offices in U.S. embassies around the world that can provide services to potential exporters.

"If someone is looking for a distributor, I can put them on a toll-free conference call with a U.S. embassy trade specialist," she said. "They will provide leads on potential distributors.

"Within a matter of weeks, the owner of a small business travels to the specific country to meet with a distributor. Their product can be on the shelves in a month."

Cook said that, "If a company is viable and knows how to make a product that is sold in stores domestically, they are ready to go overseas."

The agency also can check out a potential overseas vendor or joint venture partner to make sure they are legitimate.

"I can have the embassy check them out," Cook said. "Small businesses across Iowa are the targets of Internet scams, and unfortunately they are falling for them."

Sobaski said Breads From Anna was the target of an attempted scam involving an emailed request for a shipment of product to a school for autistic children in Japan.

"I had killed myself to get a pallet of banana bread mix put together and I looked up the school online," Sobaski said. "I felt that it must be real because a school for autistic students wanted it. That's when the buyer said he wanted to pay for it with a credit card and have it sent priority. I realized at that point that he had given me a stolen credit card number and he was actually in London."

Sobaski managed to get the would-be buyer's cellphone number.

"I called him and told him, 'You're a crook and I've notified the authorities.' He hung up," she recalled. "You really have to be careful because it's easy to be taken in."

 

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