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[Crowd talking] [unintelligible] [Rob]Okay! How's everybody
doing today? [crowd talking] Good. Well thank you all for
coming. We're really excited
to welcome here Patricia Cook. She's with the
Iowa Export... [unintelligible] I'm going to let her kind of do
her own introduction and explain what she does and how she's
affiliated with all of these
different departments. Before we jump right into the
presentation, I want to let all
of you know that this is a live recorded
broadcast that we are
simultaneously broadcasting over the online
community called MyEntreNet. Give me... Raise your hand if
you're familiar with MyEntreNet
or if you're registered on there for free. Great. Be sure to check
out that resource. Also, I have to do a quick plug for a conference
that we're hosting for small
business owners here at the end of February called EntreFEST. All
the details can be found at the EntreFEST website. And
there's also some brochures
up here. For our online audience, the web
address is www.entrefest.com. And also I want to thank
everyone online for joining us today as well. Feel
free to ask questions. And this is coming here to the
online audience. Bear with me
guys. If you guys want to ask questions, that's
fine. I'll kind of be keeping track
of those, and we'll try to get to the
questions at the end. If we
don't get to the questions, we'll kind of play
that by ear and see how things
go. Patricia has agreed to kind of
stick around for a little longer
than just the hour that we normally will allocate. So we'll
leave the webinar open for that discussion to kind of
continue happening. Again,
thank you all for coming. I'm going to go
ahead and just kind of turn
it over to them. [Patricia]Thank you very much
for having me. I am based in
Des Moines, Iowa. I'm an employee of the Federal
Government. The US
Department of Commerce has USEACs around the United
States. A USEAC is US Export Assistant Center, and we have
USEACs that help any business, large or small, to
access services and get free counseling to
develop their business. My
USEAC is an actual organization with about 300 members. So we have
a USEAC in almost every state in the United States. Come to us
by phone, by email, or in person to learn how to export. We are
part of the International Trade Administration, which is under
the US Department of
Commerce. I have the handouts that are
available for the people here
in the room. If you on the web cast can
email me after the program. You'll see my email address
shortly. And I have an
exporter's guide. I have our formal export
assistance center brochure. And this is my emailable flier,
which I would send any participant if you raise
your hand and let me know your
email address at the end. And this gives a full outline of
all of our services. We'll go
over that in the webinar portion. I'll actually sit
down shortly and give you a
powerpoint presentation that you'll be able to view over
and over again until you get all
these details clear in your mind. Before I start,
though, I have a couple visitors here today from a bank
and from the Small Business Administration. If you could
each come up and briefly
let us know what your organization is and how you
would help an international
business. - I'm Eric Olson from Wells Fargo here in
the Cedar Valley. I'm a business banker and
specializing in commercial lending from
operating to foreign exchange to foreign letters of credit or any
of those different capacities. Wells Fargo is a bigger bank in the Midwest, and we can offer
and provide pretty much any service that you
may need to handle any of your
foreign business needs that you have. To provide a local feel, that's why I'm here. Everybody knows
that a bank our size has these things, but they may
not know who to talk to. So that's why I'm here, just to put a
name with a face and provide
that local feel a little bit, local flavor. I do have
some contact information here as well and
information about foreign
exchange products that we have and the
things that also explain a little bit of our foreign
letters of credit and things that you may need or may
find that you might need to expand your business.
[Patricia]Okay. And now the
US Small Business Administration has an office in
Iowa specifically for
international. Please introduce yourself and
how that might help. - My name's Dee Ann Glover.
[unintelligible] in the SDA office in Cedar Rapids, Iowa. SBA has
two offices in the state. One is in Des Moines, our
district office. We are a branch
office in Cedar Rapids. I am the international trade
representative for the entire state. We have great resources with regard to training, assisting, educating as far as
[unintelligible]. We've gotten
some additional funding for the small business
development centers. They
are going to be promoting and growing their
international trade assistance to small businesses
in Iowa. We have four counselors. They're
volunteer small business people that volunteer their time
to counsel small businesses. And in the Cedar Rapids chapter
particularly, we have several retired business executives that
have had a lot of international
business experience that can be very
helpful to you. Jack Neville or John Neville in
Chicago is our expert. He's also located in the USEAC of Chicago, and he
has quite a large territory of state, but he does come to
Iowa once or twice a year, and we can get him on the phone and
get him out to visit a business and provide assistance if you
need it. We have a lot of just general
business information for you. We have financing
programs that can help
Your local lender provide the assistance that you
may need for that export of [unintelligible]. I have some
resource guides available,
and if there's any questions at any time,
please feel free. Thank you. [Patricia]Now you know we have
US export assistants there. And I want you to know that you should use both our
services, the services of SBA, but very seriously you want to
consider using the services
of bankers, lawyers, expediters, and other
professionals. It's not a little
thing. And one of the mistakes I hear in my
everyday conversations very recently are that entrepreneurs
such as yourselves are feeling like oh we're not really
exporting. We just fill an order
every now and then. We're just a little bit of an
exporter. So we'll just do it
our way. We can communicate with these people
by email and we don't want to
pay all that money to a banker or to a lawyer. We'll
just make the deal happen. They've offered so generously to
take a few samples, see if the
product's popular in their country. And
you know they've had several
orders, so now we're going to give them
a larger order. And it's amazing,
actually, how easy they're making it for us to get
into this country. And now they
just called and asked for a slightly larger
order, and they'll pay us back
real soon. Well that's where we get into
avoiding fraud. Just as you're familiar with the really
silly emails that you get sometimes with people
scamming to give them help to
move their two million dollars from Nigeria,
we have on the ground many many fraud situations in
Iowa, so unbelievably reputable, well-known, big
[unintelligible] Iowa companies
have been taken in. The sales manager gets this
call, they send a few
samples, they escalate, they want a
container load to see how it
will go, and they very foolishly accept it. Give them a credit card
transaction? Guess what. If
you're not happy with the delivery of your goods on a
credit card purchase, you can
cancel and never pay a dime. So you might have
sent them some parts thinking that they've been
working well with you, they
seem really nice, and you took their credit card
number, so you know. But
this isn't eBay. You're not safe. You're not save at all.
They can walk away. You've got no legal basis to get your money
for that. And also, they might consider that they've become
your distributor now for the
whole country of Brazil or the whole country of Turkey.
And international law in many countries says that if
you even sent a sample one
time, you formed a distributor-
partner relationship with a
bona fide agent or partner, and four years
from now, you have to buy that
person out. Your emailed your business
letter, your box of sample kits from products or software
has established them as owning
the whole Philippine territory. Now if you
just give them $200,000, they might go
away quietly. And what are you
going to do about that? So when I say use services,
go to the bank and get one free conversation about
money. I'm pretty sure they'll
talk to you once for free, and then they will convince
you that what they're selling
really is worth the $200 or $50 or maybe $1,000 for
what you have to get done. But you know if
you're going to be in business,
do it the right way and budget that into your prices as you sell.
Budget that into your business
planning. If you don't want to go there,
just don't export. Just don't
go there. Because you can really be taken
advantage of. That will be
a disaster to your company. So avoid fraud. If you get a
strange email but it doesn't
seem completely off track, maybe it seems like a
nice guy from Jordan that wants to buy some
materials for his local store, can you sell to him? This is what
the presentation is on, showing you. And then in
any case, you can contact me absolutely for free. And my
reach is worldwide. The counselors of the US Export
Assistance Centers can call the US embassies anywhere
in the world. I can call Jordan, the US embassy, to the trade
office and say this man says
he owns drug stores in the country of
Jordan. Can you check him
out for us? And either for free or for a small
fee, for example, $200, we have a standard due diligence
process where the US embassy staff will drive by his business
office, walk in the door, and
see if the guy sounds reasonable and also
give you a 12 page single spaced
financial report on the reputability of that
person. So if you want to go
forward, make them be your agent, work
with a lawyer, use that document
to do an internal discussion if
that's worth it, but you're only
out $200 due diligence. You might have a
lawyer write up a partnership
agreement, and then you can work with your bankers
or the SBA lending arms to work
out how you finance something like that.
And you know instead of waiting
nine years until you feel profitable in central Iowa, you
might be moving that product
today, and you can continue to work the
Midwest region, but you can
actually move product and do everything at once
perhaps. Make more money. So pick up the fliers off the table.
Give me your email address when you raise
your hand in the webinar session and I'll have a contact
with telephone and email for
you, and I'll send you these. The next portion will actually be with the slide show. So it is the US commercial
service that is based in every state of the US and also
around the world. My office is in Des Moines, but I travel the
state, give seminars, and
most often just respond to email questions for me. [unintelligible] Our Iowa Export Assistance Center in Iowa
is in the federal building in
downtown Des Moines, but you don't have to drive there.
If I'm traveling, I can stop by your business if you
let me know to stop by sometime,
or you can opt in to be invited to my
training classes in different
areas of the state. There are a lot of dynamic
factors involved in international
trade. And I want you to know that this
doesn't have to be mastered in
a day. It takes a long time, but at least
familiarize yourself with the
terms, the responsibilities, and set up
for yourself a business plan. I've learned that
the SBA now has the service
available to help with business plans, especially
for international. So make that
commitment for yourself that you really write a
business plan. Not only do
lenders insist you have one if you ever need to
borrow money, but for your own
sake, you need to get organized enough so that
when you go in for counseling
you can see where you left off and where you
continually move yourself down
the path to being an informed business person
working with exports. When we say immigration and
boarder security, you can
imagine since 9/11 there's a lot more searching at
ports and documentation analysis going on. The entire US
Government documentation system for
imports and exports are now computerized. You have
to have a code number on every
product you're shipping, and that's called
a harmonized number or a scheduled ID
number. We can help you
learn how to find that number. There's actually an online tool
that you can use, but you might
want to have somebody check it for you. Well immigration and
border security isn't just checking for dangerous objects. It's also
checking for fraud on these
documents, and you can be fined, not the
president of your company
necessarily, but whoever signs the
documents back at the office,
at the loading dock, the CFO, the secretary of the
president. If you signed some of these documents, you
might be personally liable that
what's in the document is true. And so
you can get fined. And there is, perhaps, a not
frequent but possible audit that could occur at
[unintelligible] When we say US diplomacy goals on the
diagram, they mean things like the State Department in
order to try to find peace and build economic prosperity in
countries so that maybe our
military presence won't be the only thing that's steering
policy in those countries. Diplomacy goals might be the
great example of the country
of Columbia where in order to bring an
economic basis to that
country, we helped the companies
[unintelligible] to grow fresh flowers so that the
very small micro- industries started, and now it's a
fantastic fact that Columbian flowers are mostly what you see
in your markets in rural Iowa
today. They've actually almost crushed
the California flower market. So when you say diplomacy
goals, that's great because now
there's a billion dollar industry in Columbia. There are
few less people that are displaced and forced to work for
terror organizations. The second shoe to drop is for
us to say we've helped the Columbians grow the flowers.
Now we need the free trade
agreement with Columbia so that... Actually we're already
letting them bring their flowers in for no tariffs.
We're not sending anything
into Columbia right now for the last 10 years tariff free.
They've had all the benefit at the outset, and if we don't
pass the free trade agreement,
we don't get to move our cars and ours solar
panels and are pharmaceuticals
into Columbia without tariffs. So the diplomatic
goals go hand in hand to the State Department, to the
Commerce Department so that
we win this game over the long term, we see
democracy flourish, and poor people who are struggling
find sustainable projects to
work on. And theoretically once we pass the free trade
agreement the California
flower market will come back up, the Columbians will
still grow flowers, and we'll
see peace and stabilization continue in
Columbia. It has, frankly,
improved greatly over the last number of years.
So technology is something
that the United States Government, if
you noticed that the president's
state of the union address, he strongly recommended we
boost technology. Ann from
the SBA just spoke about there's new
funding to help loans for certain things. If there's
renewable energy technology,
you might be amazed at the policies that support you,
some advantageous introductions to business around
the world, and some actual useful assistance for you, maybe
[unintelligible] lending
that you want to explore with SBA and with
our USEAC staff. So all these national policies are
important for you to be a
little bit aware of, but more importantly,
you might actually have to do
something about these, because there are documents to
fill out. So who needs a road
map for exporting? You might be in a
small business and you might have all these titles here. It's
often the case when I call a
company in rural Iowa, one of two people
handle all of these roles. So you need to become self-aware.
You can't say my forwarder just handles that for
me. You'd be liable to errors on your shipping
documents, and you might want
to take our coaching and advice that
would guide you to get copies
of things that other people do for you. The role of the US
Government, as I started to say, is regulation with
trade, trade promotion, assistance, and advocacy, trade
finance, negotiating and
managing trade agreements, and the statistical
recording, which can be very
fun, and we can offer insights into statistics
for you to pick what countries you'd like to sell your goods in
so it's not a blind guess. So when I have a training class... This today is more of a high-
level review, but in a training
class or in a telephone call or email exchange
between you and I, we might cover what you need to do for
every one of these agencies
to send your software to Saudi Arabia, to send some
popcorn to France, to send a plastic bucket
to Australia. You
actually might have to do something for
every one of these agencies just
to get that transactionally going. The US Department of
Commerce, which is ultimately
the agency I'm funded by, has a Bureau of Industry and Security.
They're the guards at the border, and they actually have badges
and guns, and they are checking product at the docs in New
Jersey or Long Beach, and they want to make sure that the
documents are in order before the goods move. If you've
forgotten some of the documents,
you could be fined and or your goods could be
held. We want you to learn
about the denied persons list. There
are people the US Government has designated undesirables,
and there's a website you need
to go to at bis.doc.gov. And by the letter
of the law, you're supposed to check every truck,
every shipment, every air freight parcel that takes off
before sending to a foreign
country to see if the person you've
addressed that to has been
checked on the denied persons list that day. The State
Department has the Directorate of Defense
Controls, ITAR, which means if you sell bullets, you've got to
be restricted before you sell
the bullets. Or if you sell ball bearing that can be
made into a dirty bomb, you have to have extra levels of
documents every time you ship
them, and you'd definitely better be checking the denied persons
list. It seems like an innocent
thing to have a ball bearing. Those are actually components that are on a short
list of items that cannot be shipped without an export license. So you
have to work with us to learn how to fill out an export license. And
it might be specific to which
country those goods are bound for.
There are also a couple sites of the State
Department such as travel advisories. If you're going to the
Middle East or even to Australia
during the floods, you might want to look on this
website just to see the conditions
for US citizens in the country. And I can work with you also to
get you personal addresses and
telephone numbers if you are going to a
foreign country on your own.
You don't have to coordinate a fancy service, but you might
want to know a contact at the
US embassy if you're going to Costa Rica or France or Russia
just to feel a little more comfortable. If something went
wrong, you'd know how to go
to the embassy and know how to ask for help or
assistance. Another portion of the US
Department of Commerce is the Census Bureau,
which works with the worldwide organization that
establishes these harmonized
system code numbers. These aren't made in the USA.
This is a worldwide body. I think
it comes out of the United Nations. And it's standardized,
therefore they use the word
harmonized. It's a standardized list so that
there's a 10 digit number for
cotton balls, there's a 10 digit number for
military software, there's a 10 digit number for children's
toys that are plastic or wood or bendable or in a kit that you
build yourself. Each product that you have needs to
have a harmonized system
number, and as I said earlier, don't trust another person to
help you to determine that.
That would be okay, but you need to review and
make sure that they are not
cheating the system to get a lower tariff rate.
That actually occurs on a somewhat regular
basis due to ignorance of the shipping expediter. Imagine
there might be staff turnover
and the person doesn't really know how to
codify so they just put something
on there and their boss was none the wiser or you're none
the wiser. Actually if you have
somebody handling your documents, you can
request that on every shipment
you be copied by email or with a hard copy of what they
sent out so you can, at least after
the fact, on that they're fulfilling what
should be done for your
business. And a very important bullet is
bullet number two on this
slide. It's a requirement of the United
States Government that you
file through the AES if you ship anything over
$2,500. The Automated Export System
requires that you either have your expediter
or train yourselves how to go
to an online portal and register movement of
goods of $2,500 or more each time. And there's a help
desk toll free number and an 800 number given here
on this slide where you could
call them, but if you think you have
something problematic, you
might want to call us at the USEAC first and sort of explain
how just maybe in the past you weren't aware of this and maybe
in the past you weren't quite
sure how to proceed. And we could gently review with
you until you get to the point where you might want to disclose that
you were in error with sending your bullets to Central
America without registration or something like that. It's
actually okay to report your ignorance of the system and
then move forward like a tax forgiveness with the IRS.
You might have to manage that,
or if it's just a minor thing that you
didn't know you had to keep
constant record keeping, just move forward with better
guidance. And after you speak
with us, you're also again certainly free to call the AES
US Government Office in Washington, D. C. to perfect
your methods and make sure
that you're doing this correctly. The US Department of Treasury collects money. And
when we manage the government's
business, we have concerns about law breakers. So you may have
heard in the past of certain companies based in the US that
were really gathering money to support terrorist organizations
[unintelligible] or elsewhere. Now if the US Government has
determined that a bakery in
Florida is really just a front for a
charitable organization for
Muslim Jihad of some kind, they have
been blacklisted, and the Department of Treasury
maintains a blacklist, meaning
denied companies and denied persons, the people
you can't do business with. And so if you thought you'd sell
your frozen bread dough to this
bakery in Florida, well guess what? You can't ever
for any reason. So you need to
go to this website, more work, more
checking, more required steps that you cannot
evade, and be sure that these Specially Designated Nationals
or this business entity hasn't been listed as forbidden by the
United States Department of
the Treasury. Again, if you're caught, there are
real fines. So let us help you export. Actually exporting can be fun,
and it's profitable. And I imagine you want to be exporting. It's
frankly quite approachable for entrepreneurs and very small
businesses. You can have a
start up. You can ship to Canada and practice how to
get something over a fairly easy to understand
border. You can gain a great
deal of interest from foreign markets if
you know that your product
would be desirable. There was an Iowa company that
was one of the first on the ground
for hand sanitizers during the last
giant flu outbreak. They were assisted by some of these agents
we talked about the day with free
help. They moved their hand sanitizer to the Asian
countries faster than anybody else, and they made a lot of
money. But how do you know
where to sell your software? How do you know
where to sell your toy or your
buckets or whatever? We actually can find out fairly
easy for you rather than you
just guessing or waiting to get a fraud phone
call from somebody you don't
really want to waste your time with. There's so much more to
it, and I am able to help you
with business development as well. And on this
slide, let us help you export, the buyusa.gov is one of
our export trade websites. It has a lot of tabs used to open similar to the
things we were just talking
about, sort of self-help. There's actually
some webinars to. You can learn
more about how to fill out free trade
agreement forms, how to view the AES filing requirement. And
study up on that by yourselves. Export.gov is another Federal
Government website. The TIC is our hotline for trade. It's
kind of the easy first stop for quick information. It's called
the TIC, and it's an 800 number. The thing that they're
particularly good at is
calculating tariffs for you. So if you knew you
wanted to sell your way in or your bicycle to France or
Australia, you know the tariffs in that country are the
tariffs you pay. They're not our
tariffs. They're country-specific. So you need to
calculate what that country would charge you to bring those in,
and the TIC Center does that
for free all day long, every day, at any time
you'd like. And I didn't give the number. I actually
want you to go there and
explore that website. So look it up and call them and just
kind of check what you understand about how to fill
out forms and calculate tariffs for shipping. We have this global
network of trade professionals. When I
say that I have counterparts in
the US embassies abroad, they're
members of the US Commercial
Service, my agency of the Department
of Commerce. Inside the
embassy trade office we have people who are rotated
around the world who come
from the United States. And we also have people who
are permanent hires who are
employees of the United States Government.
So for example, in Tokyo there's
one person who's been there for 20 years
who works on aerospace
[unintelligible]. There's another person who works
on fisheries. There's another person
who works on cosmetic products and pharmaceuticals. And so the
list goes on and on. And so if you
wanted to put in a flavored soybeans for snacks, I would
have you call Tokyo and find out about a trade show. And I
actually was working in Japan
last summer and was kind of impressed to find out
they're dying for United
States bar snacks. They want flavored
sausage also. Any kind of meat breakfast
sausage. They're just crazy
about pork and sausage. And we've been sending pork to
Japan for years, granted, but they'll pay a premium for fancy
snack foods. They eat a lot of snack foods.
So if you could have spicy tofu or cinnamon soybeans
or something, whatever it might
be, developing even food products
we assist with. Or if you have a technical product, I'm aware of
trade shows that you can attend
for no cost in Osaka and Tokyo, and
you get very special treatment because Japan, again for
example, is desperate for
innovation right now. They want partners, and
they also are desperate for
financial partners. They have some money
problems. So you could find
yourself with a partnership with Panasonic or
Sanyo just through a free
introduction if you'd fly to Tokyo with our
assistants and attend a technology fair, for example.
But pick any company. If we
do the research and find out that Poland or
Russia would like your equipment, because they have
compatible regions as far as we
might have things they'd like to buy, we can
discover where you should
[unintelligible]. So we work with you start to
finish. We find out if you're export
ready. I usually interview
people pretty thoroughly, and I can tell your sophistication
level. Most people tell me that they're already good, they
already have it handled, they
know how to take an order and ship. But I want to be very
careful and be sure that you
actually know how to do your documents and are fully
aware of these government
agency requirements. And then we do the fun stuff, which I just
mentioned, is finding key
markets. Find out what countries you could most
easily enter and most easily
move your product. And there are countries
with very low restrictions and
easy to manage paperwork. And there
are the countries that are
extremely difficult. Many people call and want to start
right off moving their product
to China, for example. That's a harder one to tackle. It's
certainly possible, but you might
want to just pick Panama first and try Canada
and see how that goes for you
and then expand once your staff is well
aware of what to do. So we
determine the sales potential in those
markets. We get a free
telephone call to the embassy in that country. Every time we
want to develop a new market,
I coordinate a free phone call. You have a 45
minute chat that tells you this is never going to work. This
product isn't wanted in our
country. We don't have the power supply
for it. We don't like that kind of
meat. We don't like that kind of clothing. And then you
go away without having wasted
any money or time. But then if they say wow we've
been waiting for you to call,
when are you coming, we help you work through that.
And then we refer you to the
SBA, the state of Iowa, the bankers,
the lawyers, whoever it might
be so that you don't maybe miss a moment where
you don't realize that you have to do this before we
begin, but you're all but
guaranteed an audience at a trade show or an introductory
visit in the [unintelligible]
And then you implement your marketing
export plan, which takes you
back to step one. Did you write your business plan?
Because it's hard to upgrade
something you didn't write in the beginning. So I do
urge you to take it seriously, to have some kind of business
plan for your own sake and for
the sake of the people who will counsel you. And many of the
counselors are working for no
fee, and it helps if they're able to
view an organized plan with
you with a budget and set goals for
how long you have to wait to turn profitable or what
demands you have on your business plan. So we have the proven expertise
of about 30 years assisting US
companies in this fashion. We do the
counseling, we offer the
market intelligence, we do the business
matchmaking, and we also have
commercial diplomacy. Recently the Iowa companies
Titan Tire and Firestone Tire, I believe,
were very disadvantaged by Chinese tires
coming into the United States and undercutting the market.
Our agency reported this to the US Trade Representative
and the Secretary of State's
Office of the US Government, started a battle with the country
of China, and ultimately we won that fight so that now China
isn't allowed to do this dumping of low price tires into Iowa.
That's an example of commercial
diplomacy. And you might have a product...
Years ago the Russians wouldn't
let our combines in because they said only their combines
should be bought by Russian
farmers, so the Germans in the US teamed
up together and did a World
Trade Organization battle with the power of the
United States Government and Secretary of State to
negotiate that you will buy our
farm equipment and your 1940s-era combines just
aren't cutting it. You don't
have a strong argument that you can't use a John Deere
product or an International
Harvester combine in Russia. There's a lot of fields
there, and since that time we won the argument.
Commercial diplomacy was
a success, and I think that the Iowa and Midwest
region companies have prospered due to that fact. So I'm trying to
give you a little flavor for the
fact that different agencies of the government are working
together. They're also watching
each other, and there is, much more than
even five years ago, auditing
and monitoring of your documents and your
activities. So don't feel that you can just go under the
radar with your eBay sale to
a certain country or just go under the
radar and have your brother
in law drive a couple of trucks up to Canada
and sell them. The fact is, he
might be stopped at the border and not
even be able to proceed if he
doesn't have these documents or he might have to pay $1,000
fine that day because he didn't
[unintelligible] the law. So why go there? Why not do
some homework first now that
you know we exist and continue to work toward
stronger policies in your company. So we'll work on planning and
strategy and the legal and
regulatory issues. There are often certification requirements,
electricity regulations, and things like that. You might
have heard of a UL listing on
your toaster and your hair drier. If you sell anything at all
to a country in Europe, part of the European Union, you
have to have a CE mark. You
shouldn't even sell anything or send a sample to the European
Union if you don't have a CE mark. That's something you can do in
house, it's a self-registration
process, but you're liable for damages or injury by electrical
components if you have it
registered, and you really aren't on the up and up to
be doing business in those
companies unless you have that handled. So that's another
example of some quick
counseling we can do. If I overhear you say Italy, UK,
Ireland, stop right there and
say here's some more homework. We've got to
work out your CE mark. If you
didn't know it existed, but here it is, and you can do
this yourself, it just takes a
couple of weeks. If you need certification
requirements, that would be an example of a dairy feed
additive or pet food or something that the country
where it's destined has strong Ministry of Health or
Ministry of Agriculture requirements, how will you know
what the rules are and how will
you know if they changed six months ago? We
simply send an email to that
country and say what is the newest regulation and give us a
copy of the form that you want
to have. We obtain that for you for no cost, we give
you the certification documents
that you need to attach to your type of product, and that
goes with your packet when
you ship it. And so you can see there are quite a lot
of documentation requirements,
but that will fit into your business plan and
you'll build out your list as you
go. We offer classes throughout the year. My
next class is February 24th in Iowa City. It's our most
popular class. It's the free
trade agreement documentation class at the
[unintelligible] Center. If you
provide your email address to me, you'll be
invited. It's a $50 class for three hours of instruction that
will customize your harmonized
system products into the right format for any
worldwide free trade agreement, especially
NAFTA, which is for Canada and
Mexico, but you might not realize we have a
free trade agreement with
Israel, Morocco, Australia, and several other countries. I
often find companies are shipping and
they're not getting the zero
tariff. So you could be saving thousands of dollars or a least
off your new to export sales you could offer a very low
price point if you only realized
you have no tariffs on those goods, if you
just learn how to complete this document. And it's
not particularly easy to do, so
you want to take the class once so you're comfortable
with that. And again, if you fill the document out wrong for a
free trade agreement, you get a
fine for that. So it's taken very seriously by every country as these goods
move, and the documents are
being checked. The webinar now continues with some real
life examples, but I'm not going to read them out loud to them.
This is a set of real company, real life examples
where the United States
Commercial Service counseling helped a country enter a new
market or get through an obstacle with an international
trade issue. So you might want
to review... Take this whole class over again because I know
you're very excited about
learning all of these details. So this one mentions that we
have market intelligence. We can customize research
and statistics for you on the
target markets that you see coming up.
Get background reports. We actually
charge a fee for extensive reports, but we can steer you toward free
resources as well. Here's an example of a New
Hampshire software company. That's one thing I wanted to
touch on. This is a city in an area that's fairly strong in
new technology. You might feel
that since you have software you don't have to
register it or document it
or pay any tariffs, but that actually isn't true. You have to
proceed with some caution with
software as well, even if there's no tangible good in a
box. So that would be something
to be sure to review. And the business matchmaking means that we find a trade
mission or private meetings or a trade show that might even
be in Las Vegas that you could
attend and just pay $200 for specially reserved meetings.
The highest level of US Government trade official from
a European or Asian country might be in Vegas for a technology
show, and we can get you
pre-approved appointments for $200 at their formal reception.
And those would be high-level
US trade officials that have these
sanctioned inbound trade
missions, as we call them. There are always
trade missions available to go
outbound, but those typically are very high price
point. I'd encourage you to
go if you could manage it and if it's a fit, but I like to steer
people toward the more basic,
first line, approachable things they can do
to actually make strong
connections and move quickly into the business for
exporting. So here it mentions the trade shows. We
have a website also out on export.gov, which we've mentioned,
export, gov, in this trade shows by date location. Here's the happy story of... It's pet food. Pet food's actually
a big booming market. So you know there's a market for
everything if you just know where
to look. Commercial diplomacy we talked
about the tires and difficulties. If you're a larger
company and you've had year
on year of difficulty entering markets or
been given some mysterious fees to enter beyond
your normal tariffs, we can
explore that, and maybe even on an
immediate basis, make those funny fees go away. Some
countries have problems with
fraud in their customs. And if you have a problem of
goods being held at customs at the
border in Mexico or a shipment
that got moved to a Middle Eastern country and
you think you have everything
clear but they're holding the goods in customs with no
explanation, you call me, and
overnight I can have someone from the embassy
actually go to the dock or the
airport and say what is missing, we will
fulfill it, and sometimes the
problem just goes away when someone from
the US embassy comes down
to inquire, and sometimes FedEx messed up.
Sometimes you messed up. But
we can find out what the answer is because our
officer speaks the native
language of the person native to the country.
He'd go down and find out, and
then ya well I guess you did make a mistake and they
want you to pay a $300 penalty.
That's better than throwing your things in
storage for a month or just
abandoning your goods because you feel this is
just such a hopeless thing to
try to export. There's always an answer, and through
our worldwide network, we can
always find an answer. Nothing ever goes
completely unsolved. Here's a great story about
Caterpillar. Caterpillar, John Deere, many of the biggest
companies in the world use our services on a very regular basis,
but you don't have to be a big
company. You can be a very small
company. To make an income, to make a difference
in your bottom line doing
exporting, you know you could go that big to consider it a big
to consider it a big success for
your terms. So that's who we are. This will be
available for review any time. And you can
find me at my local contact number in
Des Moines. So let's see what we can do
about questions. [Rob]Okay. Well first I would like to open it
up to you guys if you have any questions for
Patricia. [audience member]Hi Patricia.
We're a very small company and some of our sales takes
place on the web. So what
kinds of problems can we avoid or how
best to handle if someone from a foreign country
wants to order something from us, is that $2,500 limit in effect and
we could send it anywhere as long as we check
that we're not sending it to a
terrorist first? [Patricia]I believe so. But you'd
need to know the denied persons, and you need to know the denied
countries, and you need to be under the $2,500 limit. And also
for a matter of paperwork, you should have some kind of
document in your office that says what your policy is so
that if you ever have a review
of your practices you have an export
management and compliance
program. [audience member]Okay great.
[Patricia]And that sounds like a
pretty heavy thing, but it is actually a requirement to
have an EMCP. And we'll talk more about that another time.
We're having a class in Ankeny
near Des Moines in the summer with a US
Government official who's going
to talk about how to maintain your export
management and finance
program required tracking. [audience member]So
for a small business like ours, we have a unique product.
And there may or may not be some
regulations. So... [Patricia]You'd work directly with
me. And I know we've talked
before, so we'll check it out. You'll tell me your target
countries or any countries
where you suspect there might be an issue. And then the easy
short answer is with the website.
Find out what countries are barred and
just take those countries off
your drop down menu on your website. And anybody
who answers the phone, this is the country list, we just
don't do business with them.
[audience member]Thank you. [Patricia]You're welcome.
[Rob]This applies to online
retailers as well right? [Patricia]Online
retail. That would be one way to be protective enough for first
steps. [Rob]Do we have any questions
online? Feel free to enter those
questions here [unintelligible]. [audience member]Ya I just had
a question. Did I hear you say
that you can help businesses determine if there is an
international market for their
product? Maybe they've never thought
about that and they'd like to
research that out then they could do that through
your office? [Patricia]That's
right. Through accessing data portals that we have access
to, like paid subscriptions to online reference material, or
maybe more quickly and immediately my
preferred method is just to do
a free conference call with a country. And I have had maybe
one or two out of a hundred shot down where it sounds like
a nice product, but really it's not a fit in this country. We
have too many mountains and
what you have doesn't fit the terrain or
something like that. And that's
great. And then we move on to another phone call, another
country and we see what the
synergy seems like there, at which point our staff in those
countries usually goes way out of their way to help find
leads and help some sales take place. [Rob]Bobbie
had asked if this webinar's being recorded.
Yes Bobbie, we do record all of
our webinars here on MyEntreNet, and everyone here and
everybody online can access
those at any time through that MyEntreNet
website. Laurie had asked
what was that website again to see if a country had
been on that do not send to list? [Patricia]You'll have
to click through the previous
pages. I believe that one might be the
State Department. The buyusa.gov is for market
development, so that's not
regulatory. Here's [unintelligible]. Specially
Designated Nationals. I think the Treasury one will lead to the
list of barred countries and then also the list of barred
companies in those countries. [Rob]Susie had said
online... Or do we have any questions
here? [Patricia]Yes go ahead.
[audience member]For that question earlier about kind of
[unintelligible] [unintelligible] that entire process
[unintelligible] [Patricia]That's free. [audience
member]Everything there that
[unintelligible] [Patricia]But you do run into,
though, to be honest... And it's
on the handout that's in the manual we'll hand out, the one
on the white page that's in the
back of the room. We do have paid services, but they're very
minimal payments so that if you talk to Mexico, your product
is certainly desirable there, you're ready to move product,
you know how to do it, we would encourage you to have a
distributor designated, get you
through customs, and to move the product
nationwide rather than just
waiting around for one small person to move a little
product down to one shopping
center in Mexico. So what the embassy staff has is a
running list of the best
distributors in the nation for farm machinery,
pharmaceuticals, high-tech renewable energy. They invite
you to come to Mexico to the embassy and have a gold
key service. This is our premier
service. It's $700 for any small business. According to the government, a
small business is 500 employees
or less. So I think most people on the
call have the smaller business. You would have to pay for your
flight to go to Monterrey or
Mexico City, and the embassy would tell you
a nice place to stay. You'd pay
for your own hotel, but then you'd be in the embassy
compound the next day for an interview with eight of the
best distributors in the country
of Mexico hoping to have your business.
And maybe you'd walk away, like any
interview process, a couple of
the people's personalities might not be a match or it's revealed
that you'd only have a tiny
territory, or they've got huge connections
with the university systems or
ports or your sector. And then by the
time you're home in Iowa, you
know who your distributor is. You really need to work with
a lawyer at that point that would craft your distributor
contract. It's wise to say you've
got 18 months or we might dissolve the contract.
But then you've already had a
fully vetted pool of distributors. And if the
first one fails, you've got the option to call the next guy up for
free and attach them or maybe divide the country in half with
two distributors on the same
thing. That's called the gold key service. It starts
with the conference call. But
if you ever use this conference call I can
give you, I have no pressure,
you have no pressure to proceed to any paid
service of any kind. It's just
there for your comfort level. If you're
selling a simple product, go
for it. Go ahead and sell that on your own. But
I've seen the best breakthroughs in the fastest period of time with
the gold key services. I did this session two years ago at the
SBDC in Iowa City, and two of
the attendees in a room this size moved product to Saudi
Arabia, Turkey, Jordan within six months. They did back to back
gold keys. These are companies with two
employees, the owner and his
partner, and they went to the gold key,
the technology was needed in
the medical sector, and they just started selling it. [Rob]A question had come
through from one of the
attendees, is our company required to have our
own broker? When we ship and receive from Canada, we
are required to go through our
customer's broker. The only thing I see that our broker does
for us is the email. [Patricia]I've been overhearing
these discussions when companies have problems at
customs. Sometimes we call
the embassies and they say what you should do differently
to stop those hiccups at the
border, time and again, you have to have your own
broker. You have to pay that
broker. That broker picks up the shipment when it comes in.
And it might seem like a fee
you wish you didn't have to pay, but
without the broker, I've been
given to understand there's nothing exaggerated about it.
You need that broker to handle your documents. So for Canada
and Mexico and probably other markets you
would want the broker,
because misunderstandings happen. It's
not as clear cut as you might think. It's not just going
through a mail room. These
documents need to be discussed in the local
language and handled correctly,
and the problems go away once a local broker is
attached. So you might already
have a broker and think it's bothersome, but you
might not like life without one. The expenses
mount up pretty fast if you can't get through the customs
clearance process. Questions from our
[unintelligible] [Patricia]Yes? [audience
member]I heard mentioned
that there were some products that may be on a list
because they are maybe things that a terrorist
could actually... [Patricia]That's
right. [audience member]Is that a list
that you provide? Is it a list on a website?
[Patricia]It's on a website. And first you find your harmonized system
code number and review that with
us. [unintelligible] find that on the
website. And on a different
website is an ECCN number. And both of
these are as easy as going to an online catalog or an online
bookstore and just looking up a
list of numbers that go with the adjoining
product. Pretty easy to find.
You just have to know where the website is. I
don't know the ECCN number website off the top of my head,
but if you contact me, [unintelligible].
Especially if you have a product like that, you'd want to document
that you've had some counseling
and training about that. And then at a future date if you
went ahead and got a license and you did everything and you
still had a problem, on the back
end if you did ever get a fine or make a mistake, you
could say well I had training, I had
counseling. I have an email from Patricia
Cook. She told me how to get
started, I guess I still made a little
mistake. The fines, in many
cases, I've heard, are arbitrary. So if you've shown the effort, if you've
kept some kind of paper trail
where I started off saying you want to have an
export compliance management
program, it's not just that you have to do it. You're
wise to at least make some effort toward that so
if you were audited by a customs problem or a problem
like that, you can say well see
we've tried everything. There's just three of us. I guess we made
a little mistake. Your fine might
be $500 instead of $1,000. I can't speak for those
agencies, but anecdotally I've heard things like that. But they
get to evaluate your demeanor, your organization, and the
people who I call sometimes say we're so big, we're so busy,
we don't need to be [unintelligible]
with things like that. We're just an online retail store. We don't need
to call anybody about that. I don't
need your help, thanks anyway. If that's
your demeanor, you never talk
to anybody and get caught, I don't think
your fine's going to be quite so
pleasant. Yes? [audience member]What
type of labeling do you need when you
export? [Patricia]That's a very
good question, and labeling is pretty controlled by most
countries. The only way to find out is for me to send
an email to their trade staff at these
embassies and say would
you review what the current labeling requirements are for
technology goods or
pharmaceutical over the counter products or for textiles?
They very quickly and easily get that for you from
the Ministry of Health or the
Ministry of Manufacturing in your country.
They'll send that back, and they'll
give you an easy to read document that says labeling will
look like this. And that's always free. Free
communication. You could actually go to some of
these websites and find United
States Government embassy trade
offices in those overseas countries. But I beg you, don't
try to help us out by evading the process. They do not want
you to contact them directly.
They want you to go through these USEACs to filter
the questions to... If I ask a question a certain way,
it's so easy for them to just grab
that off the shelf and send it to me. If you get on
the phone and explain your great
ideas and everything else, they'll give you a
perfunctory answer, but they
might not even realize what it is your asking. So the
best thing is just to ask me. And I never get tired of
these types of questions, so just keep the questions coming
in. Do we have another one
online? [Rob]No not yet, but we do have
a comment. [Patricia]Yes go ahead. [audience
member]I have a question. We
work with a lot of small business owners, and one of the
challenges that we often hear is that the regulations and the
[unintelligible] just overwhelming. And listening to you today, you
really cut through a lot of that,
and I [unintelligible]. Is there some kind of a step by
step guide that... [Patricia]There isn't
one that exists because every one of this long list of
departments has so carefully organized and
[unintelligible] these processes.
But at our own Iowa USEAC, we have put together a
homemade version of something
like that, so if you email me I would send you a
copy of it. [audience
member]It would be uploaded into my [unintelligible]
[Patricia]Yes it will. [audience member]Then it will
be readily available to the
[unintelligible] [Patricia]Yes. Everything is
possible. Even though the
list seems very long, it really is possible. And many of those
documents fall to the wayside.
They don't apply to you. But you need to know that for a
fact. So the list won't remain
long after you become a little more
practiced. [Rob]I want to share
with everyone here a comment that came through
from Susie Gayken. It says she can vouch for the
Department of Commerce
assisting companies, as Patricia and Allen were essential
in helping me complete an audit
on my NAFTA. We are a small company
and were very unaware of the
complications that could have arised by errors
on the NAFTA. It has been four
months and we are still not totally in the clear, but all word
from NAFTA officials has been
encouraging. Thank you for your help for
small businesses. And so I
guess with that comment, since we only have about a
minute left, I also want to
thank you, Patricia, for coming down [unintelligible]
with us. [Patricia]Oh you're
very welcome. [Rob]Thank you to everyone here who came to
today's workshop. We're going
to go ahead and kind of leave this open and keep this
discussion going, but I do want
to make sure that we formally thank you for your
[unintelligible] [Patricia]Oh
it's been my pleasure. [applause] Okay go ahead. You might still
have more questions. Feel free. [audience member]Is the
powerpoint available? A
hard copy of it or... [Rob]Usually we'll upload the
powerpoint as a PDF on the
MyEntreNet website. I'm sure Patricia will
[unintelligible] [Patricia]I'd
actually prefer just to have it archived there.
And then I think it's good to access it through my EntreNet.
Once I went out and opened
the other presentations, I think it's a really
nice library of tips for businesses. [audience member]We have a
product that we were told we had to have a
dual [unintelligible] [unintelligible] our computer was
so slow that we didn't have room to do
that without throwing out too much more product than we
wanted to show. We were
looking at complications with dual stickers,
something of a hidden job or anything like that. It
increased our cost too much. If you're selling in the other
country, dual labeling, dual language, having both languages on there,
if we're selling in that country,
can we just put it in that language?
[Patricia]That would be something,
again, I would forward that exact question to my
counterpart, the toys and novelty sector in
that country or several countries, and confirm. And if you're still
not comfortable and clear, we'd
ask them one more time. But what about this instance?
What about this instance? And
that's how it would still come to a point where you
had an email with a date on it
from the US embassy trade office that says
this is what we learned from
the ministry. And anecdotally, what I've heard
from some companies is that they just use... Like if you're at a
store and you buy a shirt and it's in plastic wrap and then there's
a sleeve over it, that they label
the sleeve. So a pouch within a pouch so
that they could get the labels on there. So I don't know
if that type of look and feel would be possible,
and I don't know what happens
once it's cleared customs. That pouch
maybe [unintelligible]. [laughter] But it's all about
getting it through customs so
that they can collect tariffs in a fair
manner and then keep their
consumer education on that end. So you could explain
what your idea was to label it, with a pouch or a fold out label or kind of microchip put into the
stand. Saudi Arabia, by their letter of law, you have to
have made in the USA on every
part of every product that you send to
their country. It is an infinity of smallness they haven't
determined yet. Even every
washer of a tractor or a combine needs to
have made in the USA on it for [unintelligible] [Rob]Microchips.
[Patricia]And that's why I was
jokingly saying... Literally some companies I know
of did factory engraving. So it gets to be pretty tough. Yes sir. [audience member]I'm importing
some product, and I just had some questions.
Maybe you could send me in
the right direction of who I should speak with to make sure I have
the right labeling when I bring
my products into the US and can sell them in the
US. Because they're private
labeled. [Patricia]I have a list of import
brokers that I could steer you
to. And they might charge a small fee for their counseling
[unintelligible] ask, and I also
have... The only customs broker in Iowa
is at the International [unintelligible] in
Des Moines. He's a federal
official. So you could maybe try asking him for free
advice. I don't know how that
would go. [unintelligible] use the brokers
to then clarify. But if you put your questions together it might
be a [unintelligible] have that described for you. [audience
member]Alright perfect. [Rob]Is there not then an office
of importing like there is
exporting? [Patricia]There is not. I'm only export. Because the
money comes in if I help you. And the jobs stay in Cedar Falls/
Waterloo if I help you and you're here and you're
selling things. So we're not
funded to help importing, but we do have US Government
import officials, and I can certainly refer you to the Treasury or the
import office or the SBA office.
I mean it's not like I wouldn't tell you. But
there isn't any beefed up customer
service desk for that. [audience member]Thank
you. That's what I found out so far. [laughter] [Patricia]You're not
going to find one, but I can
help you to the best of my knowledge,
because I've kept my ears
open because it's a question that
comes up, so I do know a few
places to send you. [audience member]Okay. [Rob]Do we have any more
comments from our online
attendees here or questions? Do you guys have anymore questions? [audience
member]Just a comment. I've
worked with Patricia for a little while now, and truly, in the different
seminars that I've been at, exporting sometimes can [unintelligible],
and especially from a small business person's point of view.
But the great thing that is a secret that we
have to keep trying to get people to understand is that
there's resources to help you. And as [unintelligible], there are
regulations that you have to
follow to do it right, and you want to [unintelligible] and there's a lot of resources
available. [unintelligible] [Patricia]Right. [audience
member]Okay I have one more
question. What if say I were to import my products
and then someone wants to buy
them from me in Canada. So it's kind of a
double layer there where you're importing and exporting.
[Patricia]Ya that's perfectly
legal, and it's called a transnational [unintelligible].
But you don't dare claim it
as a NAFTA [unintelligible], because it's
imported and all you're doing
is... You can't order a bunch of
watches Taiwan and sell them
to England, just mark the price up a little bit
and... [unintelligible] There's all kinds of tests and regimens and lists to say is it
made in the USA. And remarkably, you could make
a software product in the United
States with 100% foreign components,
and it would be a United States
product. So you do want to learn about
that. And at the class we're having on February 24th, we go
into that extensively what qualifies as a US product.
And you might find that very interesting and helpful
because it's not just about using
your free trade agreement, in that upcoming class, it's about
how the law looks at that so that if you refabricated it and
add to it enough, it flips to become a made in USA.
If you put a ton of marketing... Think of the product Proactiv. I
think that's made in Iowa. And you've probably seen ads.
Here's a free ad to Proactiv.
But it's on... You know what do they really
have in there? Some liquid in
a bottle with a label on it. But the TV ads are
fantastic. So if you can show
your marketing costs you nine million
dollars a year and some of your inputs are from who knows
where in another country and all you're doing is squeezing it into
a little bottle in a bottle plant,
your inputs from marketing count as a US
input. Or your software genius is
redeveloping something into code or a service
to track fleet vehicles. Even though your
chips came from Hong Kong, if you innovated it into some kind of a
GPS or tracking device or a box that does something with your
little bit of tiny bit of extra
software, that can be made in the USA.
Perfectly valid. But you have to know what's good enough to
count for that. And that's the beauty of that next class
that we're having is that it
explains that [unintelligible]. Yes go ahead.
[audience member]Is there
any chance that the people who were here today if
[unintelligible] what they're
doing [unintelligible]. Some of these
entrepreneurs... [Patricia]I
just have a quick question. Are we on camera still for the
webinar's sake? [Rob]Yes.
[Patricia]And maybe we could close that out and then just
switch to the last minutes of chat. Because I think we've
covered the core topics, and
then we could go and visit. So just say our
goodbyes. [Rob]Yep. Thank
you everyone for coming to today's webinar. We're going
to go ahead and close out the
webinar. If you do have any questions for
Patricia, her email address is
here in the slide, and then also we'll be putting up
the archived webinar here shortly with the
powerpoint. So thank you
all again for attending, and have a great afternoon and
weekend. [Patricia]Bye
everyone!