Question: Hawaii imports far more than it exports, and the Hawaii district office of the U.S. Small Business Administration is trying to help reduce the state’s trade imbalance with an upcoming free counseling event for local businesses interested in exporting internationally. Why?
Answer: (Mary Dale) Exporting is a great way to find new customers. Many small businesses interested in increasing sales and profits are taking their businesses global. Nearly 96 percent of consumers and more than two-thirds of the world’s purchasing power reside outside U.S. borders. That presents a tremendous opportunity for small businesses who prepare themselves to tap those markets, particularly in high-growth Pacific Rim areas. Other good reasons to export — for the rewards for the state and national economy as well individual business owners and entrepreneurs — include reduced dependence on a small local market or economic downturns; diversified sources of revenue; extended sales potential; and stabilized seasonal markets and sales fluctuations.
Q: Has the Asia-Pacific Economic Cooperation conference that will take place in Hawaii in November inspired the idea for counseling or created more interest in international exports?
A: (Dale) While the APEC conference will boost opportunities for Hawaii-based companies due to the increased visibility of the islands to the delegations of ministers and the international media, the event is not the primary motivator. SBA has provided tools for training, counseling and financing to help break into the international trade arena for many years. The agency and staff support export financing with our lenders and regularly assist with resource information, market research and planning through the Hawaii Small Business Development Center, the Export Assistance Center, SCORE and other consulting partners. We have seen some increase in interest in exporting in the last year, likely due to the proximity of many Pacific Rim APEC participants to Hawaii, their growing consumer needs and their potential as export trade partners.
Q: Do you know how many Hawaii companies engage in exporting internationally?
A: (John Holman) I would estimate that somewhere between 750 and 1,000 businesses in Hawaii conduct some form of export business. Sorting through statistics can be difficult since there are frequently "pass-through" products that are sold in Hawaii but not actually produced in the state. Conversely, many successful Hawaii companies that export produce their products on the mainland and ship directly to save on shipping costs. These figures are not included in state export data. In terms of dollars, service exports from Hawaii exceeded
$5.9 billion while products sold internationally added another $684 million in 2010. Solid increases are being reported thus far in 2011, with product exports up more than 15 percent, so the market continues to grow, based on current trade data.
Q: What range of products do Hawaii companies export overseas?
A: (Holman) The top export sectors in Hawaii include services such as travel and tourism, education and training, architectural and engineering while the leading products are consumer goods, ranging from bath and body treatments and cosmetics, apparel, bottled water and agricultural products such as coffee, macadamia nuts, papaya, seafood and honey. Green energy technologies are also moving up the charts for Hawaii exports.
Q: What is Hawaii’s biggest product export internationally?
A: (Holman) Not surprising, the No. 1 service export continues to be tourism services as the economy is still dominated by that industry, but the contributions of educational and architectural and engineering services to the international customer is growing. What is more surprising is that Hawaii’s leading exported product is bottled water.
Q: What country is the most popular destination for exported Hawaii products?
A: (Holman) Leading trade destinations for Hawaii products include Japan, Korea, Hong Kong, Singapore, Canada and Australia. China is on the horizon but will continue to be a challenge for U.S. exporters for a while.
Q: In what ways does SBA help promote or assist with Hawaii exports?
A: (Dale) About 70 percent of all U.S. exporters have 20 or fewer employees so SBA has placed a priority on helping these small businesses, locally and nationally. Online tools are available to get started or evaluate chances as an exporter. To find out what actions are required to get into exporting, go to www.sba.gov/content/6-steps-begin-exporting. Cash is king in the export world, too. Loans SBA guarantees can be tailored to specific export needs whether funds are required to finance a single international transaction or to build, modernize or expand facility to meet the demands of a new, growing customer base. SBA also hosts or co-sponsors training events and trade fairs at different locations designed to connect businesses with new contacts, resources and buyers.
Q: When and where is the free counseling event, and where can someone go to register or get more information?
A: (Dale) The "Export Resource Day" features private consultations with knowledgeable export professionals from Hawaii Air Cargo, the state Department of Business, Economic Development and Tourism, First Hawaiian Bank, Hawaii National Bank, Foreign Trade Zone #9, SCORE, the Export Assistance Center and SBA. The event will be conducted by SBA at the Hawaii District Office at Waterfront Plaza, 500 Ala Moana, Suite 1-306, Thursday from 9 a.m. to noon. Contact Mary Dale to register at 541-2990, ext. 211 or email mary.dale@sba.gov.
Interviewed by Andrew Gomes, agomes@staradvertiser.com. "Akamai Money" seeks out local experts to answer questions about business in Hawaii. If you have an issue you would like us to tackle, please email it to business@staradvertiser.com and put "Akamai Money" in the subject line.
