Increase in exports bolsters economy

Nevada companies are shipping goods across borders and over the seas in increasing numbers.

Exports rose 22.9 percent, or $291.7 million, for the first half of 2010, the Nevada Commission on Economic Development said last week. Northern Nevada companies say that as the U.S. economy struggled under the weight of the recession, development of foreign markets became a vital avenue to increase sagging revenues.

Kathline Spring, director of business development for Rust Bullet, a Reno-based company that sells a proprietary rust-inhibitive corrosion coating, says international sales have risen dramatically and have helped carry the company the past few years.

Spring says in 2009 the company enjoyed 125 percent growth in its international export program. In 2010 that number is trending up another 48 percent through the end of August and Rust Bullet is finalizing several large orders that could potentially double its 2010 export business.

Rust Bullet has built a presence overseas its biggest markets are Malaysia, Indonesia, Australia and New Zealand by targeting businesses with assets that are subject to rust and corrosion, and by carefully approaching companies that work in industrial markets to represent Rust Bullet's products.

"You have to really know the target of the companies or entities that you approach," Spring adds. "It is very, very easy to get lost in what a lot of different companies offer. It is very important especially with small businesses that our dollars be spent very wisely. You have to be your own advocate and research what everyone is trying to do for you and pick what fits your company, product or service."

Rust Bullet manufactures its corrosion-prevention products in Southern California but is in the process of consolidating operations to northern Nevada, Spring says.

Joe Dutra, president and CEO of Kimmie Candy Company in Reno, says his company's export business in 2010 has increased 12 to 14 percent after a 70 percent rise in exports for 2009. Last year the company exported about $200,000 in candy products overseas, and through September 15 it had boosted exports to nearly $350,000.

"We have been really fortunate; we surpassed 2009's total sales in August," Dutra says. "This has been a pretty good year."

Kimmie Candy exports primarily to Canada, Mexico and the Philippines and does a small amount of business in Middle Eastern countries such as Kuwait and Dubai. Kimmie Candy has increased its distribution channels in part through industry trade shows: a sweets and snack expo in May landed a distributor in the Philippines, and the company is headed to Dubai for a similar trade show at the end of October.

"We believe we can start entering those markets more and push into Canada in 2011," Dutra says. "We are going to push international sales quite a bit in next six months. I believe the dollar will stay weak for a while, and where we can see major growth is in a lot of international sales."

Mike Jackson, president of The Micromanipulator Company in Carson City, says his company's international sales have ramped up as a result of a global recovery in the semiconductor industry. Micromanipulator makes test equipment for the industry, and as fabrication of computer chips increases, Asian manufacturing companies require more testing equipment.

Jackson says Micromanipulator's international sales, which usually account for 30 to 50 percent of the company's revenues, suffered in 2009 and accounted for just 15 percent. However, sales to Asian businesses are tracking between 40 and 45 percent in 2010.

"That is pretty good for us," Jackson says. "We have seen some of the larger manufacturing fabrication lines coming back online. They are starting up major fabrication in Taiwan and Singapore, and we have been able to enjoy some of their business. We are seeing a resurgence in the semiconductor industry."

Along with increased exports due to an industry rampup, Jackson says exports have increased through concerted efforts to capture market share in China. Oftentimes, he says, people are surprised that global semiconductor companies utilize the services of a Carson City company.

"Our products are used for engineering and development testing of the latest semiconductor technologies," Jackson says. "People are surprised that that technology exists in northern Nevada, but we are well known for that capability."

One longtime northern Nevada company says the key to sales in foreign markets has been to open wholly owned subsidiaries in select markets. Haws Corporation., which makes drinking fountains and sells eye-wash stations overseas, founded a subsidiary in Switzerland in 1984, followed by similar operations in Singapore in 1999 and Sao Paolo, Brazil in 2003. Business in Brazil is trending up almost double over last year, President Tom White says.

"We have found that to really be successful overseas, it has taken being on the ground to make it happen for us."

The good news about the rise in Nevada exports is that the nearly $300 million bump in revenues comes without precious metals figured in. The dollar volume of shipments of gold and silver was down 11.6 percent from the same period last year, says Al Di Stefano, director of global business development for the Nevada Commission on Economic Development.

"Exports have really have come back from our companies except for precious metals," Di Stefano says.

The increase in exports also means additional employment for Nevada's workforce. Di Stefano says that the U.S. Department of Commerce estimates that every $131,000 in export dollars creates one new job, and the state's export increase results in 2,227 new jobs.


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