Reach Global Markets with the SBA
by Seth A. Goodall | March 9, 2015
Today, 98 percent of American companies that export are small businesses, but more than half of our exporters are only selling to one foreign market, usually Canada or Mexico. It’s time to take action to help more entrepreneurs reach new markets for their goods and services.
Therefore, it is essential for Congress to renew Trade Promotion Authority early this year to help open doors for small businesses that would otherwise remain closed. New trade agreements are critical to helping level the playing field for our nation’s small business exporters, which have fewer resources to overcome trade barriers and gain market access than larger companies
Increases in U.S. exports have generated nearly one-third of our overall economic growth and supported 1.6 million new jobs. Last year, the U.S. exported a record $2.3 trillion of goods and services, an all-time high. One out of every five American jobs is tied to exports. These jobs generally pay better, nearly 20 percent better. Under President Obama, SBA has supported $6.6 billion in small business export financing – more than any other President. We guarantee 90 percent of export loans (working capital, line of credit, or fixed-asset financing) on amounts up to $5 million. We also have an expedited approval process on export loans under a half-million dollars.
With two thirds of the world’s purchasing power residing outside the U.S., the SBA is acutely aware that trade agreements play an important role in the long-term success of America’s small businesses, and SBA is working to help small business owners across the country grow their businesses in this global economy.
Through its network of trade finance specialists located in U.S. Export Assistance Centers throughout the country, SBA provides training and consultation services on trade financing and U.S. government export programs to both lenders and small businesses.
Test Logic Inc. is an example of a solid local business that elevated their small business through SBA Export Funding.Started in 1997, by a small 2 man team, TestLogic began in a small shop in East Haddam, CT. Having perceived a real need in the aerospace MRO (Maintenance Repair and Overhaul) community, the founders agreed that a market existed for a truly customizable testing solution for large companies who had the need to test turbine engines. Based on this idea and backed with nothing other than their own personal credit cards, TestLogic landed its first contract priced $0.6 million dollars. Their first job, being a total success, ensured that TestLogic was an accepted player in the very tight knit MRO group. Soon, word began to spread, and more companies recognizing the value that TestLogic had to offer, became clients. After spending 6 months in their small 3,500 sq ft. facility in East Haddam, TestLogic was able to move to a larger 10,000 sq ft. facility in North Branford, CT, and hire additional employees. Their success was also noticed by local banks, which were now willing to back TestLogic financially, allowing for further expansion, and market growth. Currently TestLogic is located in Middletown, CT in a 14,000 sq ft. facility, and employs 17 employees total with 2 being hired in the past year.
In 2001, TestLogic entered the global market for turbine test platforms with their first major overseas contract, providing a custom designed and built turbine test platform to Australia. That year export contracts made up 25% of Test Logic’s overall revenue, while now in 2012 that percentage has grown to over 75%. Being able to provide this type of system used to be primarily the domain of large aerospace producers. As a smaller business, TestLogic is able to provide individualized service, and rapid customer response making it an extremely effective supplier to aerospace companies worldwide such as Japan, the Philippines, Australia, Singapore, Canada, France, Turkey, and the United Kingdom. With current revenue levels reaching $4 million, TestLogic has solidified its position as both an unmatched systems provider and an accomplished exporter serving clients domestically, and worldwide. This level of growth has also been fostered by additional support from various SBA Export assistance programs, allowing for even more export opportunities. In 2010 they obtained an SBA backed Express loan for $850,000 from Sovereign Bank with the assistance of Anne Evans of the U.S. Dept. of Commerce & Middletown Export Assistance Center. TestLogic’s Middletown facility produces everything from component level assemblies such as test stands, and fuel delivery subassemblies, to full design and construction of the actual facilities.
Originally posted on SBA Newsletter by Seth A. Goodall, “Reach Global Markets with the SBA”. March 9, 2015, Accessed on March 16, 2015