By Peter Galuszka, The Chesterfield Observer
Exports are the way to go, especially for small to middle-sized businesses, according to a new campaign by local and state economic development officials.
“We have an exciting new program,” says Garrett Hart, director of the Chesterfield Economic Development Authority.
Dubbed the Metro Richmond Exports Initiative, the program offers training and advice for companies interested in selling to other countries. The Virginia Economic Development Partnership is putting $150,000 into the program. J.P. Morgan, a major international bank, is matching the money.
The program is being run by the Greater Richmond Partnership; the Virginia Gateway Region covering economic development south of Richmond, including Chesterfield; and the VCU Center for Urban and Regional Analysis, along with local economic development authorities.
“Exporting can have an incredible new impact on a company,” says Grace Festa, business development manager at the Greater Richmond Partnership.
She says selling overseas can boost overall revenues and help local companies weather economic downturns in this country.
Yet exporting has its challenges, including understanding foreign countries’ regulations and markets and managing currency exchange rate fluctuations.
The initiative will put together “Exporting 101” courses for executives of local small and middle-sized companies starting in the spring. The initiative is also hosting monthly lunches for executives to network and learn about what’s coming up.
“I see this as a great foundation to get novices exporting,” says Holly Pearce, VEDP international trade manager.
If business managers are interested, program officials can assess their companies to see if they are ready to export and what markets might be best suited for them.
After that review, business executives can go along on VEDP trade missions to such countries as Mexico, the United Kingdom, Japan, France, Israel and Chile, among others. Local business people will pay for their own travel but can apply for up to $2,500 in grants that will be used by VEDP to hire foreign experts to advise them of local regulations and market conditions.
Hart says that about 600 firms in Chesterfield are involved in exporting, but precise numbers are hard to come by. So far, local firms participating include SweetFrog, a specialty yogurt maker based on Midlothian Turnpike, and ITAC, which sells engineering services from its Chester offices.
Exporting, despite its benefits, can be tough. Wood Fuel Developers, owned by ITAC, had been exporting wooden fuel pellets to Europe, but the market dried up when the dollar’s value rose dramatically in relation to the Euro.
“We exported quite a bit to Europe in the past two years, and we have export experience,” says Christian Boehme, Wood Fuel’s business manager.
But exports dropped to nothing with the rise in the dollar’s value. “We are very dependent upon the exchange rate of the dollar to the Euro,” Boehme says.
The exporting program comes as VEDP is under attack for mismanagement.
The Joint Legislative Audit and Review Commission (JLARC), the accounting arm of the General Assembly, recently issued a scathing report that found VEDP was granting funds to foreign companies without sufficient oversight.
Yet, the participation of such a venerable institution as J.P. Morgan boosts the prospects of the new export initiative.
By chance, the election of Donald Trump may help because the new president has been highly critical of companies that take jobs overseas to take advantage of cheaper labor and then export products back into the United States. Exporting does the opposite and could shore up local jobs.