Exporting Oklahoma: State leaders outline top potential markets,

Journal Record, The (Oklahoma City), Apr 27, 2006 by Kirby Lee Davis

Keith Ellis praised state advisers as he held up the 2006 Governor's Award for Excellence in Exporting.

As vice president of engineering with IronWolf, the Noble-based manufacturer of crushing equipment, Ellis told how his company made its first export in 2003. Over the next two years, IronWolf's exports to Mexico and Canada climbed to compose 81 percent of total sales - a success Ellis attributed in part to help his firm received from the Oklahoma District Export Council, state Department of Commerce and others.

We just wouldn't be here to accept this without all the experienced departments of Oklahoma, he said.

That captured the spirit of the 23rd Annual Oklahoma World Trade Conference, held Wednesday at Tulsa's Doubletree Hotel at Warren Place. Officials started the day by profiling the world's 10 hottest markets for exports. They outlined easy-to-use Web outlets to identify the right place for the right product. They offered state success stories, explained trade agreements, and detailed exporting logistics - all in one day.

This is the reason I'm here, said Justin Hazzard, the project manager of Century Inc. That Midwest City firm is investigating direct exports into Europe. The conference offered him key background.

Hossein Shafa, professor and director of global programs and strategies for Oklahoma City University's Meinders School of Business, pointed out more than 10 hot markets. He recommended the top four - China, India, Russia and Brazil - and then turned to the big emerging markets of China, India, Indonesia, South Korea and the Association of Southeast Asian Nations; Mexico, Brazil and Argentina; Poland and Turkey; and South Africa - with Egypt rising as a possibility.

Perhaps it's the best way to get into the Mideast in the future, he said.

Not only does the United States already export more to the BEMs than to Japan and Western Europe, but Shafa said the emerging economies are expected to grow two to three times faster than members of the Organization for Economic Co-operation and Development.

Such exports do involve risk. Only a few of the BEMs fall under free trade agreements, noted Anthony Grasso, an international trade compliance analyst with the U.S. Department of Commerce International Trade Administration in Washington, D.C. Some of these, like Singapore or Mexico, act as gateways to other markets, but even then the risks remain high.

There's really no such thing as free trade, he said. What we try to negotiate is fair trade.

But success stories abounded Wednesday. IronWolf received not only the Governor's Award, but also one of five U.S. Commercial Service Export Achievement Certificates, along with Gurkee's International, Joshi Technologies International, Siemens Applied Automation, and Tulsat.

With 96 percent of the world's consumers living outside of the United States, the economic security of our nation is increasingly dependent on exporting, said state Commerce Department Interim Executive Director Amy Polonchek.

In many respects, our domestic market is a mature market for our goods and services. If we are to continue to grow as an economy, we must look outward, to new markets where consumers seek the best products and services in the world - those made in the United States, she said. The export efforts of these five Oklahoma companies in a significant number of countries exemplifies this outward looking.

That rang true with the experiences of Beth Doty, the international sales representative for Advance Food Co. of Oklahoma City. Her firm started exports to Mexico in 1989 and never looked back, taking its products into Canada, Puerto Rico, the Caribbean, and Central and South America. While the firm encountered several bumps along the way - including some troubles it might have avoided had it done more of its homework first with state export officials, she said only partly in jest - Advance has tripled its business through such trade since the North American Free Trade Agreement took effect.

Advance has created brand loyalty in Mexico by reaching out to the audience with specialized packaging and building relationships with buyers and purchasing departments. Bringing Mexican executives to Oklahoma for a plant tour proved especially beneficial.

Even so, Doty warned that even a market as apparently secure as Mexico offers great risk. She pointed to July's presidential elections, where leftist politics threaten to destabilize a historically weak democracy. Her company also endured problems with destabilization of the peso, though it recouped those losses by sticking with its investment.

Such issues also are issues in South America, Shafa said, and in other nations. Several do not appreciate current foreign policies of the United States, though they still like Americans. China, meanwhile, presents its own opportunities and concerns.

Shafa said companies considering exports must truly understand the markets they will operate in. They also should plan both entry and exit strategies ahead of time, thinking through how they can get their investment out of a market.