By Dave Somers and Mike Fong / For the herald
There’s no doubt that international exports are big business for Snohomish County and Washington State.
In 2019, more than 12,000 Washington companies exported more than $55 billion worth of goods and services internationally. Last year, the Port of Everett inaugurated a major expansion of the Norton Terminal that will modernize our ability to get goods to market. We have over 200 advanced aerospace and manufacturing companies in Snohomish County that account for a significant number of export-related jobs. Snohomish County’s Paine Field Airport is Washington State’s Most Economically Important Airport, Representing $60 Billion in Economic Impact and Over 158,000 Jobs According to Economic Impact Study Washington Air Force. Meanwhile, after five straight years of declining exports from 2016 to 2020, analysis by our regional economic development organization, Greater Seattle Partners, found a significant reversal in that trend with exports up more than 7, $3 billion in 2021.
As trade is key to our region’s economic growth and prosperity, it is critically important that the economic opportunities created by exports prioritize small businesses and advance equity.
We know that already almost 90% of the export activity in our state is generated by small businesses representing approximately 25% ($14 billion) of the total value of goods and services. During the pandemic, many small businesses had to quickly change their business models by going digital and relying on e-commerce as a means of survival. This dramatic and global adaptation creates disparities in resources, time and broadband access and other infrastructure challenges for our rural communities and BIPOC and women-owned businesses. To advance an equitable recovery, we must be intentional about how we focus services and programs that expand export capacity and increase awareness of the resources currently available.
The Washington State Business Expansion Program (STEP) is a program funded by the Small Business Administration that provides direct cash assistance, in many cases up to $10,000, to help small businesses grow their international sales. The reimbursement program will cover marketing materials, web design, international payment processing, product sample shipping, travel, trade missions and translation services. Over 900 companies have used the STEP program in our state. For more information, visit the state Commerce Department website.
Often small business owners and entrepreneurs want to expand into international markets, but don’t know where to start. The Washington Export Outreach Team and SBA Resource Partners at Small Business Development Centers have certified experts who can provide personalized advice and ongoing support to companies interested in exporting. These underutilized services are usually offered for free and can help with business development, planning, and market research.
Small businesses wishing to expand by exporting may need access to additional funds. Fortunately, the SBA offers three financing options for small U.S. exporting businesses or businesses affected by import competition:
The Export Express Loan Program provides quick access to capital for businesses that need financing up to $500,000. You can apply for a line of credit before finalizing an export sale or even before going to a foreign market. Securing your financing ensures that the necessary funds are in place before you agree to the terms of the contract.
The export working capital program allows small business owners to apply for loans of up to $5 million before finalizing an export sale or contract, giving exporters greater flexibility in negotiating payment terms to fulfill orders and finance international sales.
The International Commercial Loan Program helps small businesses enter international markets and make investments to compete with other importers. These loans, up to $5 million, offer a combination of fixed assets, permanent working capital financing and debt refinancing with a maximum SBA guarantee of 90% on the total loan amount.
We are both committed to the SBA and Snohomish County working together to help small businesses reach new customers through exporting and create an even stronger base of well-paying jobs. We have a long tradition of innovation and entrepreneurship in our region, and since 90% of global consumers live outside the United States, according to the International Trade Administration, we know what we need to focus on.
As we continue to recover from the pandemic and global travel fully rebounds, we have a great opportunity to prioritize exporting. With partners in our region, we look forward to creating more equitable access to the tools and resources necessary for small business success.
Dave Somers is Snohomish County Executive and Board Member of Greater Seattle Partners. Mike Fong is the Pacific Northwest Regional Administrator for the United States Small Business Administration and former Snohomish County Recovery and Resilience Officer.