The Benefits of Exporting Business Success

Recently, I was asked to help a friend develop a business case for their company for increasing their exporting into foreign markets. Immediately, I began to dig into the data to support this request. As it happens, I also needed to write an article, and here we are. Below you will find the ‘tip of the iceberg’ of reasons why exporting is good for business. From accessing new markets and increasing profitability, to building resilience and fostering innovation, the benefits of exporting are vast and impactful. Let’s dive in to explore how exporting can transform and elevate your business on the global stage.

In an increasingly interconnected world, the aerospace industry leads the charge in globalization. The U.S. exports over $100 billion annually in aerospace products alone, and holds 41.2 percent of the world-wide total of aerospace exports. Today, exporting serves as a gateway for companies to access the vast international marketplace. It accelerates growth, leading to increased profitability, more jobs, and higher wages. Moreover, exporting raises a unique form of resilience, helping companies reduce or mitigate risks, notably during challenging domestic economic conditions. Additionally, as companies engage in exporting, they tend to become more innovative, as they are exposed to diverse cultures and alternative business practices. 

Accessing New Markets: A World of Opportunity

Exporting presents companies with the opportunity to access the vast majority of the global marketplace that lies beyond the borders of the United States. While the U.S. holds only 5 percent of all market share, 95 percent of consumers are located outside its borders, representing a significant opportunity for growth and expansion. By exporting, companies can tap into these new markets and reach a much larger customer base, leading to higher total revenue, faster revenue growth, and increased labor productivity. This enables companies to transcend national boundaries and connect with a diverse array of customers worldwide, adopting a more robust and sustainable business model.

Driving Profitability 

Exporting not only expands a company’s reach but also enhances its profitability. Studies have shown that companies that export experience faster sales growth, with a 17 percent increase compared to non-exporting companies. This growth translates into the creation of more jobs, as exporting companies often need to expand their workforce to meet the demands of new markets. Additionally, according to the Export-Import Bank of the United States, employees of exporting companies tend to earn more than their counterparts in non-exporting companies. This combination of increased sales, job creation, and higher earnings demonstrates the significant impact that exporting can have on a company’s bottom line.

Building Resilience and Reducing Risk 

Exporting not only helps companies build resilience by navigating fluctuations in the U.S. economy but also reduces risk by diversifying their customer base geographically. Companies that export are better equipped to withstand economic uncertainty by spreading their operations across the global market. This diversification mitigates the impact of economic downturns in any single region, making exporting companies more likely to stay in business and thrive even in challenging times.

Strengthening Innovation 

Exporting exposes companies to new cultures, markets, and ways of doing business, promoting greater innovation and competitiveness. By engaging with diverse markets, companies gain valuable insights into consumer preferences, industry trends, and technological advancements. This exposure not only sparks new ideas and approaches but also encourages companies to adapt and evolve their products and processes to meet the needs of the different markets. As a result, exporting not only drives innovation within companies but also enhances their competitiveness on a global scale.

As companies navigate the complexities of a rapidly evolving global market, exporting emerges as a cornerstone of their growth and success. By accessing new markets, driving profitability, building resilience, and fostering innovation, exporting not only benefits individual companies but also contributes to the overall advancement of the aerospace industry. As we look to the future, it is clear that exporting will continue to play a pivotal role in shaping the landscape of the aerospace industry, driving innovation, competitiveness, and sustainable growth on a global scale.

Resources 

For companies looking to begin or enhance their exporting efforts, a range of resources are available to provide guidance and support. Washington State, and states across the U.S., offer several initiatives to assist companies in their exporting endeavors, including the State Trade Expansion Program (STEP) or Export Voucher Program. The STEP Export Voucher Program provides grant funds to eligible small businesses to offset qualifying costs associated with export-related activities such as export training, website localization, compliance testing, in addition to participation fees associated with foreign trade missions, trade shows, and other export promotion activities. Leveraging this resource can empower companies to expand their reach into new international markets.

Further, companies in Washington State can benefit from joining state-led international trade shows and missions. These trade events provide valuable opportunities to showcase products and services, connect with potential buyers and partners, and gain insights into foreign markets. By participating in these activities, companies can expand their network, increase their visibility, and explore new business opportunities globally. 

The Export Finance Assistance Center of Washington (EFACW) offers a range of valuable trainings and services to support exporting companies. Their comprehensive training programs cover topics such as export financing, risk management, compliance, and market entry strategies, providing companies with the knowledge and tools they need to succeed in international markets. In addition, EFACW offers personalized consulting services to help companies navigate the complexities of exporting, including assistance with export financing options, trade credit insurance, and accessing foreign markets. By utilizing the resources and expertise of EFACW, companies can enhance their exporting capabilities and achieve greater success in the global marketplace.

On a national level, the U.S. Commercial Service offers a range of export promotion services to help U.S. companies succeed in international markets. Through its global network of trade professionals located in U.S. Embassies and Consulates around the world, the U.S. Commercial Service provides market intelligence, trade counseling, business matchmaking, and advocacy support to help companies navigate the complexities of international trade. 

Additionally, the Export-Import Bank of the United States (EXIM) offers financing solutions to support U.S. exports, including working capital guarantees, export credit insurance and direct loans. EXIM’s programs help mitigate the risk of non-payment by foreign buyers, enabling U.S. companies to offer competitive financing terms and win export sales.

In conclusion, aerospace companies in Washington State and across the U.S. have access to a wealth of resources and support services to help them succeed in the global marketplace. By leveraging these resources and tapping into new markets, companies can expand their reach, drive growth, and achieve sustainable success in this dynamic aerospace industry.

To learn more about enhancing your companies exporting or joining a Washington State trade show delegation, please reach out to Joanna Boatwright, aerospace international trade specialist with Washington State Department of Commerce at: joanna.boatwright@commerce.wa.gov.