Exporting products to foreign markets was once something reserved for large corporations with extensive resources. However, in today’s business environment, many small business owners are looking for the opportunity to expand their market reach and to truly participate in the global economy. This is becoming more and more feasible for small businesses with rapid advances in technology and communication. However, there is still a learning curve and certain capital investment required to export profitably.
There are also a myriad of legal concerns to take into consideration before a small business can start exporting. These legal concerns may be very specific to the industry and the product in question. However, things like trade restrictions, intellectual property law and contract law of the target country are always to be taken into consideration. It is always advisable to consult legal counsel prior to making any determination to export or where to do so.
Good News! There are extensive resources and opportunities out there for small businesses to shorten that learning curve and attain the capital to build their export business. One such program is the State Trade and Export Program (STEP) Global NY Exports Grant. Section 1207 of the Small Business Jobs Act of 2010 directed the Office of International Trade (OIT) to create and implement the STEP Program with two directives:
1) Increase the number of U.S. small business exporters; and
2) Increase U.S. small business export volume.
The OIT essentially manages cooperative agreements with each of the states, which provide matching funding to participants. Empire State Development (ESD) is the New York State agency tasked with managing the applications and distributions of STEP funds within New York. Since the inception of the STEP program, New York State has received over $600,000 in federal funding and provided over $300,000 in matching funds, which has resulted in nearly $1M in awards to small businesses in New York.
STEP awards can be used for a variety of activities to attain these directives, such as:
- Participation in foreign trade missions
- Foreign market sales trips
- Subscription services provided by the U.S. Department of Commerce
- Website and/or marketing material translation services
- Export trade show exhibits
- International trade workshops that align with the program objectives
In order to qualify for STEP funds, applicant businesses must meet SBA size standards based upon their industry. Applicants must also be operating profitably for the past year, must have a product for export, and must meet the standards and mission of the STEP Global NY Exports Program.
Small business applicants may only apply for 1 award at a time, but are eligible for up to 3 separate awards based upon the availability of funds.
HoganWillig has attorneys well versed in both domestic and international business matters. We have helped a myriad of clients navigate the extensive regulatory requirements of exporting and the STEP application process. Please contact us if you have any additional questions or would like to set up a consultation to determine your ability to qualify for the STEP program or to begin working on exporting more generally.