But Herko's experience points up the limitations of exporting within federal programs. According to Mr. Miller, the bank won't guarantee loans to countries with major political or economic problems. Mr. Gutierrez says Ex-Im Bank closed the program to finance exports to Venezuela when economic and political unrest rocked the country last year.
Ironically, Venezuela's instability proved a boon to Herko's exporting business. Because of strikes in the oil industry, Venezuela had to import lower-quality gasoline from Brazil, Mr. Gutierrez says, and people who ran out of gas added alcohol to their gas tanks. That put a strain on fuel pumps, fuel filters, and other parts.
While Herko previously sold around $100,000 annually to Venezuela, that figure jumped to the $600,000 to $700,000 range. At the same time, Herko managed to buy products at better prices than in the past. "We're able to make better deals right here in the states," Mr. Gutierrez says.
| Top 50 Exporters by State | ||
| State | Number of companies |
Total 2002 export sales ($M) |
| Florida | 24 | $1,200.91 |
| California | 8 | $57.18 |
| Texas | 6 | $57.37 |
| Michigan | 3 | $73.50 |
| New Jersey | 3 | $13.49 |
| Wisconsin | 1 | $81.00 |
| New York | 1 | $10.00 |
| Virginia | 1 | $5.60 |
| Illinois | 1 | $4.95 |
| Georgia | 1 | $3.00 |
| Oklahoma | 1 | $2.97 |
| Washington, DC | 1 | $2.00 |
| Total | 50 | $1,511.97 |
| © 2003 Hispanic Business Inc. Reprinting, copying, or transmitting all or part of this information requires written permission. | ||
Another reason for Herko's increase in exports also applies to MARISA Industries, the number 14 company on the Top 50 Exporter directory. Both companies supply parts to auto manufacturers in Mexico. As their customers' production increases, so does their need for components. At MARISA, exports increased 25 percent, from $12 million to $15 million, between 2001 and 2002.
Such supplier relationships are becoming more common in the global auto manufacturing market. Manuel Rosales, assistant administrator for the SBA's Office of International Trade, says Hispanic companies are more likely than the overall business population to participate in the market by exporting goods and services.
According to Mr. Rosales, around 2.5 percent of Hispanic companies receive some export revenues, compared with around 1.8 percent for the entire U.S. business population.
"We find that a lot of the multicultural communities in the U.S. are really very comfortable in the international arena," Mr. Rosales states. "Services are a big component of the growth in small business in the international arena."
The SBA also has guaranteed loan programs in conjunction with state governments in California and, just recently, Florida. Under the California program, for example, the state could guarantee a loan of up to half a million dollars, while anything over that amount would be guaranteed by the SBA. Texas is expected to become the third state to enter into such an agreement with the SBA. The three states – Florida, California, and Texas – account for more than three-fourths of the companies on the Top 50 Exporter directory (see table, "Top 50 Exporters by State").
On the larger political front, Mr. Rosales says the North American Free Trade Agreement has helped U.S. exporters increase their foreign sales and has encouraged companies that previously didn't export to make an entry into the global economy. He believes trade agreements with Australia, Chile, Central America, and the Americas as a whole (the Free Trade Area of the Americas) will open up even more opportunities to U.S. exporters.
