Laurel Delaney provides guidance to companies considering international trade during last week’s Utah Global Forum. The first-ever event at the Salt Palace attracted several hundred people. Delaney, author of exporting-based books and founder and president of management consulting company GlobeTrade, encouraged small businesses to consider foreign trade. Currently, only 370,000 small U.S. companies are involved in international business. Photo by Joe Canfield.
“There are business opportunities everywhere.”
With that sentence, Gov. Gary Herbert articulated the gist of the first-ever Utah Global Forum, a gathering of business and government leaders to learn about opportunities to conduct international trade.
Last week’s event at the Salt Palace was hosted by the Governor’s Office of Economic Development (GOED), World Trade Center Utah and the Salt Lake Chamber. Rather than concurrent breakout sessions, the forum consisted of quick presentations — most of them 15 minutes — and expert panels focusing on the opportunities and challenges of entering the global marketplace.
Statistics abounded. For example, Val Hale, executive director of GOED, said that Utah has grown exports to Mexico by 851 percent during the past two decades, including quadrupling in the past 10 years alone. “With numbers like that, I’m sure that your business would love to have a piece of that type of trade with Mexico,” he told the crowd.
Lane Beattie, president and CEO of the Salt Lake Chamber, noted that trade with the European Union rose 86 percent between 2007 and 2013. “That’s absolutely phenomenal, and just remember what the economy was like during that time,” Beattie said.
Herbert said Utah has doubled its overall import/export totals in the past 10 years, and exports in 2013 totaled $16.1 million. Of that figure, $7.6 billion was in value-added products. In each of the past few years, Utah has led the nation in export growth, accounting for 150,000 new jobs in the state.
“I’m here to tell you, I think we’re just barely scratching the surface,” the governor said. “I think the potential that we have worldwide is incredible.” Ninety-five percent of the world’s population is outside the U.S. and they are all potential customers, he added.
Laurel Delaney, founder of GlobeTrade and author of several books about exporting, displayed a slide indicating 2013 saw a record $2.3 trillion in U.S. exports, which supported a record 11.3 million U.S. jobs. However, only 1 percent of U.S. companies are exporting, and only 370,000 are small businesses.
“So what that should tell all of you is that there are a whole heck of lot of small businesses that are not exporting, for whatever reason. … We have a lot of room for additional growth,” she said.
She added that most small businesses that are export-ready are growing quickly. “And even though they may not be growing at a speed they would like to be growing, many of them at least have the ability to stay in business longer than non-exporting companies,” Delaney said.
Herbert reiterated a goal spelled out earlier this year for Utah to grow its value-added product exports by $1.6 billion over the next five years.
“That’s the goal, which is lofty. It’s certainly not something that’s going to be easy to do, and there are many naysayers who say, ‘Gary, you can’t do it.’ But I remind everybody that the same people who said we can’t do this said we couldn’t create 100,000 jobs in 1,000 days either,” Herbert said.
“We’ve proved the naysayers wrong. Utah has a can-do spirit. We have a mentality and attitude [where] we can succeed where others may be struggling.”
Among Utah’s advantages is a global recognition — “being known outside our own borders at a level we’ve never had before in our state’s history,” he said. Among the reasons are the 2002 Winter Olympic Games, Utah’s promotional spending and the state’s many trade missions in recent years, allowing Utah to advance from “an unknown commodity.”
“This is the best place in America to live, to raise a family and to do business, and, with your help, we’ll make it the best place in the world,” he said.
Among some of the other highlights of the forum were:
• Delaney saying companies and owners need to take stock of themselves to determine if they have the mindset necessary to be successful in exporting, and to determine which business model to use when they make the move.
• Craig Allen, deputy assistant secretary for China Global Markets for the U.S. Department of Commerce’s International Trade Administration, explaining demographic changes occurring in China.
That country now has 54 percent of its population living in urban areas, up from 20 percent in 1979 and resulting in the movement of about 300 million people. The population also is aging and becoming more middle-class.
What’s more, about 171 Chinese cities have populations of 1 million or more. “I would argue to you that it is in these secondary cities that a great deal of opportunity lies for Utah companies,” he said, adding that China itself represents “the most exciting economic opportunity of our lifetimes.”
• Paul Campbell, president and general manager of Campbell Scientific, advising companies starting trade in China to pay attention to the character of the people with whom they are dealing, to find a compatible market niche, to protect their intellectual property through interdependent relationships, and to be loyal to their employees and share their success.
His company started doing business in China because it was growing, it wanted to show a commitment to Chinese customers, it wanted to provide better technical assistance and improve product training, and it believed it would open the door to new markets.
• Sundaresan Ram, associate professor of global marketing at Thunderbird University, extolling the virtues of branding. “Everything can be branded in life,” he said, noting that some worldwide brands are recognizable even by people who cannot read or write.
Growing a brand involves having both tangible and intangible benefits for the customer, who must have an emotional connection to the product or service.
Strong brands also allow companies to command a premium from customers. Some companies, he said, are able to earn 20 percent to 80 percent higher prices because of the value of their brands.
Among other topics discussed at the forum were teamwork, state and federal government resources available to companies wanting to export, the European Union, financing and investment capital, finance risk management, Mexico, and legal/tax and accounting matters.