All over the U.S. there are non-profit economic development organizations that offer free or low cost trade counseling, export outreach, and technical assistance to U.S. businesses looking to export. The Export-Import Bank of the United States (Ex-Im Bank) has established relationships with over 75 of these entities through our City/State Program network. If a business needs advice on export-related issues, Ex-Im Bank’s City/State Program members can provide the information and services that it needs to succeed. The Mississippi Development Authority’s International Trade Office (MDA) is one such organization.
MDA offers Mississippi business leaders international business assistance, including educational, marketing, and business-to-business referral services. MDA also works with Ex-Im Bank and other federal partners such as the Small Business Administration and the U.S. Department of Commerce so that Mississippi businesses can access financing-such as export credit insurance and working capital- and can participate in programs such as the Department of Commerce’s Gold-Key Matching Service, which allows U.S. businesses to find foreign buyers and obtain significant market research.
One company MDA has equipped to enter the international marketplace is Magnolia Metal & Plastic Products, Inc. Magnolia Metal is a Vicksburg, Miss., based company that specializes in the manufacture of window and door components, primarily screens. Magnolia Metal is a “mom and pop shop” that employs 35 people out of their factory in Vicksburg.
Over the past five years, Magnolia Metal has expanded their business internationally with sales in Chile. Since 2009, Magnolia Metal’s business with Chile has grown significantly, expanding from $5,000 in sales to $25,000. While Magnolia Metal grew internationally, it worked with a distributer in Chile that purchased their goods wholesale and then sold their products to regional suppliers. When Magnolia Metal started exporting, it initially relied upon being paid for its exports on a cash-in-advance basis with their Chilean distributer paying them via an international wire transfer before they shipped their goods.
Following a change in ownership of the Chilean distributer and an increase in sales—Magnolia Metal received an order for $50,000—they needed to offer an alternative to cash-in-advance payment. MDA was able to help. Magnolia Metal knew from previous conversations that MDA could provide information and resources on offering credit terms to their foreign buyer.
As soon as Magnolia Metal reached out to MDA, MDA put them in contact with an Ex-Im Bank Trade Finance Specialist within an hour. The Ex-Im representative assisted Magnolia in getting a $100,000 Express Insurance Policy after just short two weeks. Express Insurance is a type of export credit insurance for small businesses that provides protection for up to 95% of a business’ invoiced foreign receivables. Having export credit insurance empowered Magnolia Steel to offer flexible credit terms. It also gave them the confidence to make a larger sale with their new Chilean distributor because they knew that if that distributor defaulted, Ex-Im Bank would cover up to 95% of their shipped goods.
With Ex-Im Bank’s support and MDA’s assistance, Magnolia Metal is continuing to succeed internationally. Magnolia Metal projects they will grow their $50,000 in international sales to $300,000 through fiscal year 2016.
MDA was crucial in helping Magnolia Steel grow their business and increase their international sales. MDA offers services that Mississippi businesses are able to access at any point in the business cycle or at any stage of a business’ growth. Most recently MDA continued to help Magnolia Metal sign up for a trade mission to Mexico City and Guadalajara, Mexico, where they were able to build the relationships that will help them expand their business into Mexico.
Learn more about MDA’s International Trade Office by visiting their website, www.mississippi.org, as well as other federal export resources for U.S. exporters at export.gov and business.usa.gov. Find a full list of Ex-Im Bank City/State Program members and how to contact them via exim.gov.