Export Assistance Centers: the original one-stop-shop for U.S. exporters – The Office of Domestic Operations: the Bottom Line for Exporters
Norbert Gannon
In 1993, the Clinton Administration realized that federal government export promotion efforts could no longer simply be “business as usual.” Resources were increasingly limited and at the same time the competitive environment faced by U.S. exporters was becoming extremely complex necessitating a more efficient system of information flow. Furthermore, access to export capital often limited small- and medium-sized businesses that might otherwise be active exporters. The Administration decided to work smarter and more efficiently rather than rely on more money in order to solve problems existing in the marketplace and developed the concept of one-stop-shops for U.S. exporters. These one-stop-shops were named Export Assistance Centers (EACs).
The EACs are a bold and innovative step toward providing, in a single convenient location, hands-on export marketing and trade finance support for small- and medium-sized companies. The EAC concept hinges on: (1) streamlining the delivery of federal services, (2) leveraging resources with partner organizations, (3) taking advantage of communications technology, and (4) continuing to focus on export-ready manufacturers and service providers. The EACs are a joint effort of the U.S. Department of Commerce’s Commercial Service, the Small Business Administration, the U.S. Export-Import Bank, and at one site, the U.S. Agency for International Development.
The EAC network is comprised of a regional “hub” and “spoke” system designed to effectively service regional trading areas. Electronic links and state-of-the-art communications technologies help the Centers deliver more services faster to more of our target clients: export ready firms, i.e., those with the commitment and resources to establish or expand export operations.
The EAC program has been intensely client-driven from its inception. The Commercial Service’s Office of Domestic Operations has the unique advantage of a vast domestic field network of offices all around the country. These offices allow the Commercial Service to be directly plugged into the exporting community and its particular needs. In addition, domestic field offices maintain strong partnerships with state and local export promotion organizations which increase the effectiveness of federal export assistance services. Whenever possible, we co-locate EACs with other public and private partners (such as World Trade Centers, state development agencies, port authorities) which improves the accessibility to services and allows the leveraging of resources among partner organizations. This partnership extends the range and depth of services available at a single site, and establishes a more rational, integrated delivery network.
At each EAC, one-on-one counseling is available to small-and medium-size businesses with export potential. Trained export counselors at the EACs work with. clients to evaluate their needs and help them develop customized international business strategies. They work with firms to determine their export potential, find new markets, and plan market entry strategies. EAC staff members evaluate the needs of clients and help them develop customized international business strategies based on the clients’ experience and commitment to exporting. Counseling is also available through Commerce’s District Export Councils (DECs), SBA’s Service Corp of Retired Executives (SCORE), and the Export Legal Assistance Network (ELAN).
Trade finance assistance provided by SBA and ExIm is available for U.S. businesses interested in selling their I goods and services abroad. EAC staff will assist businesses in obtaining export credit insurance, pre-export financing through working capital loan guarantees, and medium and long-term loans and guarantees to overseas buyers. This allows small businesses to obtain needed capital through long-term, fixed-asset financing to establish or expand international markets. Guarantee programs that include short-term working capital loans and regular business loans are also available.
EAC specialists are trained in all federal export promotion programs. Centers can also provide guidance to and feasibility studies. For firms that are not yet export-ready, the SBA has developed the Export Trade Assistance Partnership to provide introductory counseling and referrals. According to Eileen Cassidy, Acting Assistant Administrator and Director of International Trade at SBA: “The Export Trade Assistance Partnership, better known as E-TAP, addresses a critical need in the USEACs for focused assistance for the new-to-export small businesses. We have already witnessed great progress with this program. In fact, the first E-TAP class will graduate from the Long Beach USEAC this August.”
To date, Domestic Operations has opened 14 USEAC “hub” offices in the following cities: Chicago, Miami, Baltimore, Long Beach, Seattle, Cleveland, Dallas, Denver, St. Louis, New York, Philadelphia, Atlanta, Boston, and New Orleans. Very shortly ODO will open a USEAC “hub” office in Detroit. In addition to the “hub” offices, ODO has opened 14 brand new District Export Assistance Center (DEAC) “spoke” offices. Secretary Kantor announced the conversion of the rest of the domestic field network, over 50 district and branch offices, into DEACs at the May 10th National District Export Council meeting in Cleveland. On May 23 the Secretary also announced Commerce’s intention to put a USEAC in Charlotte, N.C.
Export Assistance Centers represent the future of federal export promotion efforts. To extend the services of the U.S. Export Assistance Centers to all of the nation’s exporters, the Commercial Service plans to open approximately 16 new DEAC offices in suburban areas to bring its trade specialists closer to their clients and complete the export promotion infrastructure of a national EAC network. This network will allow the federal partners to provide enhanced export marketing and trade finance services to a greater number of exporters than ever before. The design uses electronic links and communications technology to make the most of the limited federal resources. The new network also relies on close cooperation with state and local, public and private partners to effectively provide the level of service required by small and medium companies striving to be successful exporters.
Below are just two examples of countless EAC success stories across the country.
Precision Components Corporation (PCC), York, Pa. Prior to 1992, PCC was primarily a large supplier to the Navy and made more than 90 percent of its sales to the defense market. However, with the 1992 curtailment of the Seawolf Submarine Program, it found itself forced to terminate 250 of its 650 employees. Precision began an initiative in Japan to convince a nuclear utility consortium to consider PCC for transporting nuclear fuel. However, PCC’s financial institution was reluctant to provide working capital without an Export-Import Bank guarantee. The Commercial Service became involved pro-actively and assisted PCC in its request to obtain an unprecedented multiyear Working Capital Loan Guarantee arrangement with ExIm Bank. John De Felice, Chairman, President and CEO of Precision, states that, “through the combined efforts of PCC personnel, Representative Bill Goodling’s office, the Commercial Service, the U.S. Department of Commerce, the Pennsylvania Department of Commerce and the Export-Import Bank, PCC is overcoming the effects of the defense downturn, providing increased employment levels, and contributing to the economic health of the region.”
FloWind Corporation, San Raphael, Calif. The San Francisco office has counseled this company on doing business in India as well as on the programs of the U.S. Export-Import Bank that are directly helpful for the financing of export sales. Working with ExIm representatives, the Commercial Service was able to get a commitment on an ExIm financing product for FloWind while the President of the company, Hal Koegler, was in India closing a deal. Koegler credits the San Francisco office with providing critical assistance in this $28 million sale and anticipates sales of about $50 million a year to India.
COPYRIGHT 1996 U.S. Government Printing Office
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