Small Business Exports Edge Up

Posted by: John Tozzi on February 2, 2012

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Small businesses have increased their share of exports in the two years since President Obama set a goal to double U.S. sales abroad by 2015, according to new federal data.

Companies with fewer than 500 employees accounted for 35 percent of exports in the third quarter of 2011, according to preliminary figures from the Census Bureau, up from about 32.8 percent in 2009. The figure, from a report set to be released in April, refers only to sales of goods, not services.

“Ninety-eight percent of U.S. exporters are small and medium-sized enterprises but these exporters have historically represented only 30 percent of U.S. export value,” Tim Truman, a spokesman for the Commerce Department’s International Trade Administration, said in an email.

The increase follows a two-year government effort to expand the reach of American companies by increasing trade financing and technical help to businesses that want to export.

Still, the results of those efforts are modest, says Laurel Delaney, president of GlobeTrade, a Chicago-based consultant to exporters. “It’s like the needle isn’t really moving much for the small business market,” she says. Delaney says measuring service exports might show greater growth among small businesses because of the ease of doing business online. The government doesn’t track service exports by company size.

One federal initiative that could help: loosening export controls, or restrictions on selling components of military technology that may have other commercial uses. “A U.S. company can’t sell that particular part…even though it may be used on a conveyor belt in Germany,” says Todd McCracken, president of the National Small Business Association, a Washington, D.C., trade group. “We think there’s a lot of potential there to both increase exports and increase the competitiveness [of small business] in other countries.”

The National Export Initiative aims to increase U.S. exports to $3.14 trillion in 2015, double the level of 2009. Last year, total exports (of goods and services) reached $1.9 trillion through November, up from $1.4 trillion in the same period in 2009. Obama said last week in the State of the Union that the U.S. was on track to meet that goal ahead of schedule. Full year data for 2011 will be released Feb. 10.

Photograph by Ken James/Bloomberg

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What's it like to run your own company today? Entrepreneurs face multiple hurdles new and old, from raising capital and managing employees to keeping up with technology and competing in a global marketplace. In this blog, the Small Business channel's John Tozzi and Nick Leiber discuss the news, trends, and ideas that matter to small business owners. Follow them on Twitter @newentrepreneur.

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