Global Trade: A Key Component to Michigan’s Economy

When traveling abroad, it always helps to have a guide – someone who knows the lay of the land, who can show you around and introduce you to people in the know. It’s as true in …

When traveling abroad, it always helps to have a guide – someone who knows the lay of the land, who can show you around and introduce you to people in the know.

It’s as true in business as it is in travel. The Michigan Economic Development Corporation (MEDC) plays the role of tour guide for businesses in the Great Lakes State to claim stakes far beyond its borders.

The MEDC offers an international trade program that includes multiple trade missions each year, accompanying businesspeople from Michigan to new, exotic markets spanning the globe in hopes of establishing markets there.

“Michigan is well-positioned to attract global customers as a manufacturing leader and innovator. Global trade is a key component of the state’s economy, representing hundreds of thousands of jobs,” the MEDC said on its website. “Ninety-five percent of customers are located outside of the U.S., so the ability to grow and compete globally is crucial.”

Among the mid-Michigan firms that the MEDC has helped reach a global market is Efficiency Production Inc. in Mason. This trench and shoring equipment manufacturer joined a week-long, MEDC-arranged trade mission to Argentina and Brazil in November 2017.

“I think for everybody that wants to be in a global market, a trade mission is going to help them because of the development work [the MEDC] does for you regarding the market’s components. What is the growing market in those areas?” said Raul Felman, international sales manager for Efficiency Production.

The company was one of seven Michigan businesses to make that trip.

“Michigan’s ties with Brazilian and Argentinian companies have resulted in good jobs here … this trade mission will open doors for these companies by helping them identify and enter into new relationships, ultimately growing their businesses and bringing more and better jobs to Michigan residents,” said Jeff Mason, the MEDC’s CEO, in a prepared statement.

In 2016, for example, Michigan export sales totaled more than $1 billion to Brazil and nearly $244 million to Argentina, said the MEDC, citing U.S. Department of Commerce statistics.

Efficiency Production, a 130-employee firm that hasn’t done much international business in the past, is looking to change that now. So, when Felman learned of the planned mission, he hopped on board.

“I was previously involved in other missions, so they contacted me; this was a good opportunity for our company to view Latin America a little bit stronger than we were looking at it before … we felt this was the time for us to get our name into those markets,” Felman said. “Number one, we were hoping to find the appropriate distributor or dealer that can work with our products in those particular countries, Brazil and Argentina.”

That’s where the MEDC’s homework came in handy for Felman and his firm.

“The trade mission, based on my curriculum that I sent to them and our company’s history and desire, put together some potential distributors or customers that may be interested in our product in Brazil and Argentina,” Felman said.

“In Brazil, we were there 2 ½ days. We did (meetings with) approximately four companies in Brazil and Argentina, I did nine … Argentina was very fruitful. At this point, we don’t know how it will turn out, but of course there are a lot of leads,” Felman said. “Of the nine, four are very strong companies that are looking forward to working with us, although there is one company in Brazil that is also interested that will come here for training.”

Felman expects to be actively working with Argentine clients this year. Having the MEDC provide certain connections beats having to do it alone.

When working with the MEDC, “the cost is minimal,” Felman said, and financial assistance may be available. “They help you a lot regarding the country’s history, economics and what they see going forward as the country’s risk.”

Finding new customers abroad means having more work to do here.

“I think that to work globally, it provides you with a lot of advantages,” Felman said. “Number one, it gives you a brand that you can expand throughout the world. It shows that you have a good product manufactured in the U.S. and that you can provide assistance and customer service like everybody else. Second, it gives you the advantage of when there are slow months — in our case in the winter months — we are able to provide [products] to Latin American and [other] global markets.”

The advantages are worth it for any company to consider.

“I think that everybody should evaluate their possibilities. I think there is a need for commitment from management; that’s number one. If you don’t have any management commitment, an investment in global markets will fail,” said Felman. “The second thing is to make sure you have the resources in order to be able to expand. Be sure that you have complied with all the international laws and with your requirements,” Felman said.

This year, the MEDC has five trade missions planned. These include:

• Mexico: Feb. 26 – March 2
• Germany (for industrial technology): April 23 – 27
• South Africa and Tanzania: June 1 – 9
• France (for homeland security and defense professionals): June 11 – 15
• China: Sept. 12 – 22

The MEDC also has international trade centers in Canada, Mexico, Brazil, England, Dubai and China that offer customized market research, market information, entry strategies, translation services and other export counseling services to interested businesses. The centers are run in partnership with the Conference of Great Lakes and St. Lawrence Governors and Premiers.

For more information on the MEDC’s international trade services, go online at michiganbusiness.org/grow/international-trade-services or send an email to export@michigan.org.