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Setting a goal for 2012: Export to survive

John Kalkowski -- Packaging Digest, 1/2/2012 7:05:00 AM


Imagine your company being able to double its size in three years—during one of the worst recessions of the last century. That's exactly what Gilpin and Co., an Alabama-based packaging supplier, has done. The company specializes in easy-open ends for metal and plastic containers, as well as specialty packaging, which they sell in more than 40 countries. And while Gilpin was expanding and creating jobs in the U.S., a large portion of its sales have been in international markets. That's why Gilpin recently was named Alabama 2011 Small Business Exporter of the Year by the Small Business Administration, which played a major role in helping Gilpin find the financing it needed to take advantage of these growth opportunities.


For many years, U.S. suppliers of packaging, equipment, materials and services have been able to support their growth expectations almost entirely within the domestic market. While the U.S. is a huge consumer market for packaging, it is also mature and saturated. It simply is not going to grow as fast as some other parts of the world. 


According to Jorge Izquierdo, PMMI vp of market development, most growth in packaged goods is taking place in developing countries. His advice: "To take advantage of worldwide growth, follow your growing customers. Almost all the major projects that global companies are announcing are overseas." He adds that these companies are not expanding outside the U.S. just because of cheap labor and lower costs. They're going after the burgeoning middle class in these countries who now can afford the same types of products that U.S. consumers have long taken for granted. "You need to export to survive," Izquierdo says.


It's not always easy to get international operations underway initially. Sales channels and providing 24-hour service worldwide are always concerns, but they are not insurmountable. 


There also are financing considerations that must be dealt with in international transactions. However, there are numerous federal programs, such as the Small Business Adminstration and Export-Import Bank, to encourage and support the financing. The Commerce Department and individual state governments frequently put together trade missions that can help identify specific opportunities overseas. 


Conditions for export are favorable now. Exchange rates make U.S. equipment and materials more affordable than in recent years. Now it is up to you. After all, it's a matter of survival.

 

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