MBITA New Member Provident Traders, Inc.
MBITA welcomes new member Provident Traders, Inc., a Northern California based export finance consultancy and licensed export credit insurance broker with more than 32 years experience with the Export-Import Bank of the United States (Ex-Im Bank)
Free Credit-Decision-Making Guidelines for US Exporters Who Do Not Qualify for Ex-Im Bank Credit Insurance
By MBITA Member Provident Traders, Inc.
The Export-Import Bank of the United States (Ex-Im Bank) the U.S government's Export Finance agency, has a mandate to support "New and Small" US exporters of U.S. products by, among other programs, insuring them against non-payment by an overseas buyer (aka "credit insurance").
However, to qualify for Ex-Im Bank credit insurance, an exporter usually needs to have been in the same line of business for at least 3 years, have at least one year of exporting experience, had an operating profit in their most recent fiscal year, etc.. Exceptions are sometimes made.
What can a New or Small exporter who does not meet those standards do to protect themselves if they must sell on open account credit terms?
Use the free credit-decision-making guidelines available on Ex-Im Bank's website to make informed credit decisions and begin to develop a track record.
Start by going to www.Exim.gov and click on or ask for the following online guides:
1) "Country Limitation Schedule" tells you what countries Ex-Im Bank considers safe enough to insure open account credit terms. For example, for sales to private sector buyers in Mexico, Ex-Im Bank will support open account terms, but in the Philippines, Ex-Im Bank's support is typically limited to Bank Letters of Credit.
2) "Special Buyer Credit Limit Application" item #11, tells you what minimum credit information Ex-Im Bank requires to consider granting a buyer open account terms. For example, Ex-Im Bank will want to see at least one "favorable" credit agency report on the buyer or one "favorable" trade reference before insuring a credit of $50,000 or less. Higher credit limits usually require, in addition, buyer financials.
3) "Trade reference form" tells you what questions to ask the reference about the buyer's credit and payment history. Trade references are free; credit reports are not. The Ex-Im Bank trade reference form is set up to enable you, the credit analyst, call the trade reference and interview them while filling out the form. Alternatively, you can email a copy to the trade reference and wait for an answer. Note that Terms of Sale should be Terms of Credit (Terms of Sales are Ex-Works, CIF, etc.; Terms of Credit are Cash In Advance, COD, open account, etc.).
4) "Short Term Credit Standards" tells you how to interpret/analyze the buyer's credit information. Pages 14 - 16 cover the criteria Ex-Im Bank "generally" looks for in approving buyer credits and includes financial statement ratios. Page 19 - 22 define, in detail, these criteria. Pay special attention to how Ex-Im Bank defines "favorable" trade references and credit reports.
5) "Specimen Multibuyer policy" can help you anticipate and prepare to deal with buyers who do not perform as promised. For example, Article 6, C, tells you to stop shipping to any buyer more than 90 days past due. Article 10 defines a "buyer obligation", i.e., the documents typically needed to pursue a debt in the courts of law, should you need to engage an outside collections agency.
The federal government has a lot of experience supporting export credit. Its accumulated knowledge can be put to work for you.
Copyright © 2013 by Provident Traders, Inc
MBITA welcomes new member Customs Brokers and Forwarders Association of Northern California (CBFANC)
By default of working as a Customs Broker or Freight Forwarder you automatically become eligible for membership, they also have associate members as well for business that work closely with the Brokerage and Forwarding Community.
Since its inception the Association has grown and changed, and many times advanced change, to the benefit of all stakeholders in the modern global supply chain.
As their mission's statement says - 'we're driving powerful educational initiatives to ensure that our member companies have the most professional and up to speed staff to serve their clients.' Through the dedication of their volunteer board and various committee chairs CBFANC have fostered a very close cooperation with local Customs & Border Protection, participating governmental agencies including U.S. Department of Agriculture, Food & Drug Administration and Fish & Wildlife.
Their combined efforts have led to an environment where all stakeholders are working closely together to ensure that goods and services flow seamlessly across our borders, while each stakeholder is a highly active participant in maintaining the highest levels of security.
CBFANC offer at least 10 annual educational events, which typically are CCS accredited, as well as a bi-annual CHB basics class and a bi-annual CHB examination preparatory class. In addition to Education they have several social events throughout the year and also have their annual Mission to D.C in an effort to promote the causes of the trade community.
Board of Directors Membership Chairperson
Customs Brokers and Forwarders Association of Northern California (CBFANC)
Tel. (650) 477-2691
Email Chris Kammer
Global Real Estate on the Move
By MBITA Member B. B. Wong, Brubeck-Wong Realtors
BB Wong says she has been blessed with many gifts. And one of the biggest gifts occurred following a serious health scare. In February 2010, she was diagnosed with a cancerous brain tumor. For the next nerve wracking 10 months she was treated by eight different doctors and endured endless tests and MRIs. Being proactive, she also called a longtime friend in San Francisco, Betty Wong, and asked for her help in exploring herbal medicines like the ones her parents used to rely on. Finally the medical professionals concluded she had been misdiagnosed.
The news gave BB a second chance at life. She reevaluated her goals, and embraced the Chinese belief that where there is a crisis there is opportunity. For BB, that included reaching out to others who shared her roots.
"I decided to explore my heritage as a Chinese Business Woman," said BB, who is the 2014 President of the Women's Council of Realtors. "I began to seek out my peers in the Chinese Real Estate Association of America in San Francisco's Chinatown, where I was born."
BB also joined the Asian Real Estate Association America and quickly began racking up new experiences while she worked to further the goals of the association. She flew to Washington DC and marched on Capitol Hill during a Policy Conference. She attended the Global Real Estate Summit in New York. She traveled to Beijing with AREAA founder and CEO John Wong, whom she discovered was her cousin, to witness the signing of the first mutual agreement between real estate professionals in the United States and China.
"It was the trip of a lifetime," BB said "We were treated like royalty, and visited four different cities as honored guests. We also enjoyed a special meeting with the Highest Monk in China and received his blessings."
Her business travels also took her to Paris, where she took part in the French National Real Estate Federation's 66th International Convention and European Forum "Europe Meets the World."
Eager to share those blessings, BB renewed her commitment to helping others. She increased her involvement in professional organizations, including the AREAA and Omega Nu. She joined the Monterey Bay International Trade Association, which has provided her with opportunities to work globally and attend international trade missions.
BB also embraced charity work and served as the chairperson for events to raise funds for a variety of important causes to help others in the community. And she continues to set new goals for herself. This year, she is committed to providing keys to opportunities for members of the Women's Council of Realtors, expanding her global experiences, and working with the MBITA to brand the Monterey Bay Region.
"I want to share the blessings I have received with others,"
MBITA's finance column features articles from the experts in TRADE FINANCE for exports.
MBITA/TradePort Partners with GTR Events for 2nd annual in Silicon Valley
The Monterey Bay International Trade Association (MBITA) and TradePort.org was an outreach partner and also a guest panelist speaking on Global eCommerce at the GTR Events' 2nd Annual West Coast Trade & Export Finance Conference in San Jose Ca., on October 9, 2013. Over 150 delegates attended this event.
This comprehensive one-day conference opened with a keynote address by Dan North, Chief Economist of Euler Hermes. He addressed the current trends within the domestic US market as well a attended s the role of international trade in shaping the economy of the West Coast.
The event attracted many local and international delegates from the corporate, banking and financial services sectors to discuss current challenges in acquiring finance, new regulations for US exports, SME & Mid-Cap financing, export and ECA finance, as well as specific industry case studies.
"The West Coast continues to defy the global slowdown with enviable growth rates," says the conference producer, Paul Greetham. "With international trade flows developing at an unprecedented rate, the conference was well timed to tackle key market issues and illustrate current market trends."
Marianne Rowden, President & Chief Executive Officer of the American Association of Exporters & Importers, further explains, "President Obama's National Export Initiative has concentrated the government's resources to assist U.S. companies, particularly small-medium size enterprises (SMEs), with the goal of doubling U.S. exports.
The U.S. has a number of other initiatives, free trade agreements (Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership) and export control reform, which should provide a positive environment for U.S. exporters. Nonetheless, U.S. exporters must comply with a myriad of restrictions, including sanctions against countries and individuals."
Rowden adds: "Exporta's West Trade & Export Finance Conference was timely for financial and trade professionals who needed to understand the changes occurring in global trade."
With many high-level delegates in attendance, networking was a key feature throughout the event. With numerous networking breaks and an evening drinks reception, there was ample opportunity for anyone serious about doing business on the West Coast to create new business contacts and build relationships with the foremost market actors.
"The annual West Coast Trade & Export Finance Conference has rightly become a mainstay within the GTR Events' calendar," says Peter Gubbins, Managing Director of Exporta. "We look forward to facilitating business in the region for many years to come."
The conference welcomed support from leading institutions, such as Bank of America Merrill Lynch, Citi, HSBC Bank USA, J.P. Morgan, Union Bank, Bolero International, FCIA Management Company, Codix, PSI and Burr Pilger Mayer. The event is proud to have institutional partnerships with the Northern California World Trade Center, American Association of Exporters & Importers (AAEI), and the Monterey Bay International Trade Association.
(Written by ExportaGroup.com, Oct., 2013)
Initiative (NEI) Update
Free Trade Agreement Comes to the Rescue
The Department of Commerce's International Trade Administration (ITA) helped EUR Consulting, a small California-based engineering company, overcome a foreign trade barrier that unfairly excluded the company from competing for a $400,000 government procurement tender. Leveraging the U.S.-Chile Free Trade Agreement (FTA), ITA convinced the Chilean government to reconsider EUR's eligibility to compete for this project, and opened the door for future government contracts. EUR Consulting represents ITA's latest video success story. A link is provided below:
Why It Matters
If ITA had not ensured compliance with the U.S.-Chile FTA, EUR Consulting and other U.S. engineering companies may have continued to experience discriminatory treatment when competing for other Chilean government procurements of public works projects. The government procurement provisions of the FTA provide that U.S. engineering and architecture design firms should have an equal opportunity to compete for covered public works projects. In the aftermath of Chile's 2010 devastating earthquake, the country is in the process of building and rebuilding public structures including hospitals, schools and other civic institutions and qualified U.S. companies must be allowed to compete for these projects.
In February 2011, EUR Consulting reported to ITA that Chile's Ministry of Health excluded it from bidding on a government procurement opportunity to build a hospital because it did not have prior experience in Chile designing seismic shock resilient structures. The U.S.-Chile FTA ensures that U.S. companies are treated the same as Chilean companies when competing for covered government procurement contracts. EUR Consulting has designed buildings throughout the world that can withstand seismic activity and, in accordance with the FTA, that experience should have been considered when competing for this project.
Advocating on behalf of EUR Consulting, ITA officials raised concerns with the Chilean government and pressed the importance of upholding the government procurement provisions of the U.S.-Chile FTA. In May of 2012, the Chilean Government reversed its decision and allowed EUR Consulting to compete in the hospital tender. This win sets a positive precedent for U.S. companies seeking to do business in Chile.
"As a result of the great work by everyone at the TAC Program, our company has an opportunity to compete with unrestricted barriers."
Eloy Retamal, President, EUR Consulting
Have You Encountered a Foreign Government-Imposed Trade Barrier? Contact us today! tcc.export.gov/report_a_barrier
This article was issued by the International Trade Administration (ITA) of the United States Department of Commerce (U.S. DOC)
Contact Fernando Sanchez, International Trade Specialist,
Trade Agreements Negotiations and Compliance,
Enforcement & Compliance.
Tel. (202) 482-2305.
The National Export Strategy is available also at
http://trade.gov/NEI and http://export.gov.
International Trade Update at
United States Department of Commerce
Office of Public Affairs - Tel. 202-482-4883
Ayse Oge is a published author and global trade marketing expert. She is the author or the book Emerging Markets. Ayse's Corner is a periodic feature for the World TradeWinds eZine'.
Culturally-Appropriate Product Adaptation
Product adaptation is the process by which an exporter modifies and improves upon a product to make it more appealing to the target market. Selecting and preparing your product for export requires not only product knowledge but also an understanding of the unique cultural characteristics of each target market. Local customs, such as religion and the use of leisure time, often determine whether a product will gain market acceptance. For example, the Japanese customer's desire for attractive packaging has caused many U.S. companies to re-design their cartons and outer packages to make them suitable for this market.
Doing some basic research on your foreign partners, buyers, and customers should give your company solid ideas on what products can be sold in that market. When your company is trying to establish a global presence, it is helpful to travel to the target country to experience your customers' consumption patterns and habits pertaining to your product. The data you collect will help you decide which products need to be changed ever so slightly (or may need to be totally reinvented) to fit into the local culture.
This cultural gap can be minimized through a variety of ways:
Localizing a product and/or a service:
Any company that is interested in marketing internationally needs to partake in extensive research to eliminate any potential problems. For example, Nokia introduced wireless phones with a dust-resistant keypad and built-in flashlight for truck drivers who travel on India's not very well-lit roads.
Changing the product
Sometimes it may be necessary for companies to change their entire product to make it appealing to their foreign consumers. For example, Kraft remade its popular Oreo cookies to look more like wafers in China when the executives of the company saw that the cookie-wafer segment was growing faster than that of the traditional biscuit-like cookies. This new Chinese Oreo consists of four layers of crispy wafer filled with vanilla and chocolate cream, coated in chocolate. Kraft's efforts paid off well, doubling its sales of the product in China.
Expanding product applications
Business owners can also take advantage of hidden market opportunities to increase sales by observing how a product's application is specifically used in a foreign country. For example, Turbo Tek Inc. invented a hose attachment for washing cars, and they found that in Japan their Turbo-Wash is used for cleaning bamboo, while the Dutch use it to wash windows and plants. By appealing to certain traditions and cultures, they were able to expand the product's functions.
Studies reveal that companies willing to invest in and design their products for a specific market are most likely to succeed. In the long run, culturally-appropriate product modification can yield handsome returns for your investment.
Ayse Oge is President of Ultimate Trade, International Trade Consulting, Speaking and Training. Ayse Oge is Regional Director of Business Education Statewide Advisory Committee in Los Angeles, CA. She is also Board Member of California Business Education Association and Program Chair of CBEA Annual Conference, November 15-17 in San Diego, CA.
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