I have been reading cyber security magazines for several years. Many very interesting articles appear regarding different products and innovations. I don’t see too many articles discussing exporting of US made Cyber Security products overseas. I would like to share that experience and encourage Maryland as well as US companies to examine the infinite possibilities overseas.
Our company is located in the Cyber Hive of the University of Maryland Baltimore County. There are many companies in our Office Park, but very few are concentrating their efforts on exports. Everyone is trying to sell to our Government: local, state and federal. These opportunities invite a lot of competition and require significant effort on behalf of the company to prepare different bids. One never knows whether contracts will be awarded. Wouldn’t it make more sense to know that there are buyers overseas and if they like your products, you are assured of a sale.
In this article, I would like to encourage companies to look into opportunities in this area. We can command higher prices, because there is less competition for our unique products. The adage “Made in America” label is highly respected throughout the world. They know that our country has strict legal rules and regulations and for the most part we abide by them unlike many other countries of the world. They know, that we would not embed spyware in our software in order to obtain information that will give us financial advantage.
It is crucial for any new company who would like to enter the export market, to check and make sure that the products the company produces are exportable. It has to meet ITAR rules and regulations “International Traffic in Arms Regulations (ITAR) control the export and import of defense-related articles and services on the United States Munitions List (USML)”. Once it has been determined that the company’s products are exportable, they can start proceeding to the next steps.
The most frightening notion for a US company is the unknown and the fear of foreign languages. There is a substantial number of resources available to overcome this fear. One can start with zero knowledge; different government agencies will hold your hand and give you support. Huge concentration for the past several years has been on export. This is the reason local, state and federal governments will support a company who is interested in exporting since it creates jobs at home as well as those overseas. In addition, governments can collect huge tax revenues and stimulate the economy. One of the resources that I would suggest to start with would be Small Business Administration at University of Maryland, Baltimore, UM Ventures, 620 W. Lexington Street, 4th Floor, Baltimore, MD 21201.
Another resource is SBA Export Financing Program provided by the Office of International Trade. Check it out at www.sba.gov/international. Another good resource is State of Maryland DBED. These organizations will be a good starting point for any company who would like to begin to discover information in the international export arena.
The best place to start is to decide which country one wants to do business in and then which industry one would like to sell products to. Once the decision is made, you can contact the above organizations and seek their help in order to make connections with appropriate buyers. Once you have determined the two items above, you are now ready to contact the US Embassy in the selected country and ask for the economic attaché’s office. They will know whom to refer you to and they will describe the type of services that are offered by the Embassy to US companies. For a small fee the Embassy personnel can invite potential buyers to the Embassy to meet with you, and hold your hand throughout the entire process. Their job is to vet potential partners for US companies and make the connections. Their services are invaluable.
It needs to be stressed here, that it is paramount for a US company to have an in-country partner. It’s almost impossible to do both sides; to be a seller and a buyer. Once a partner is found, upon request, it could be investigated on company’s behalf by the US Embassy of the country where you decide to do business. The cost is $600.00. It’s a lot cheaper than losing thousands of dollars if you happen to partner with a dishonest person.
To encourage you further to investigate the field of product exports, what should attract one’s attention is that if you sell for example a software product to US government, your maximum profit margin is dictated by the government contract, which is on average 1-5%. The same products we sell overseas for which we receive a minimum of 30%. One can easily do the math. Now it sounds very attractive and it’s worth all the hassles.
In closing, I would like to add that it is incredibly rewarding doing business overseas. They really appreciate what we bring to the table.