Nevada has won approval for a $283,000 federal grant to assist the state’s small businesses grow their exports or begin to export abroad.
This comes on the heels of a $300,000 grant issued a year ago by the U.S. Small Business Administration that helped fund trade missions for companies going to Poland and Australia. The competitive grants, known as the State Trade Expansion Program, allow companies to participate in trade shows and trade missions, said Robert Holguin, the SBA’s Nevada district director.
“It’s a great way to help our economy here in Nevada, and it really helps small businesses get exposure so they can see if their products are capable of being exported and technical assistance to set them up,” Holguin said. “We had some success stories from last year’s trade missions.”
Holguin said Henderson-based K2 Energy had success in exporting batteries to Poland and Las Vegas-based PR Diamond, a construction saw maker, exported to Australia.
Kris Sanchez, director of international trade with the Nevada Governor’s Office of Economic Development, said the Australian mission resulted in $53,000 in contracts for two companies that traveled there.
“That was a good success in exporting, and we will see growth over time for those companies in that market,” Sanchez said. “It’s really what the grant is intended to do. It’s to help them get into a market and see over time that they are able to expand. That’s what we want.”
Sanchez said some 87 percent of exports come from smaller to medium enterprises, and it’s important those companies are strengthened.
“They tend to be the backbone of the economy, and if they’re exporting they tend to pay higher wages and can weather the fluctuations in the economy,” Sanchez said. “We’ve very much focused on leveraging those federal dollars to help Nevada-based small to medium enterprises export.”
The SBA announced possible trade missions to Spain and Nordic bloc countries, but nothing has been formally announced.
Sanchez said there’s a possibility of a trade mission to South America in 2017. Companies also have the option to use funds to go to other countries where they can export their products. The state works with individual businesses to help assess their ability to export and which countries would be a good fit, he said.
“It depends on the product and maturity of the company,” Sanchez said. “A company that’s brand new to exporting we don’t suggest they take off to India or China because it’s difficult to break through in those markets. We work with each to make sure they have a good place to be successful.”
The state is taking applications for companies who want to attend trade shows in the U.S. and internationally. It focuses on companies ready to export now rather than those going on fact-finding missions, officials said. Companies are urged to have identified viable markets and have done some initial work to build relationships in that market.
The goal is for the companies who receive grant funds to have sales of $11 or more for every $1 it receives. In previous grant awards on a national basis, it generated $22 in U.S. small business export sales for every $1 awarded, officials said.
The grants range from $2,500 to $10,000 and companies are required to match the full amount of the award. Companies can only use it for up to two export sales events a year. The money can cover airfare, hotels and registration and exhibition fees.
The companies are expected to use the funds to gain export sales within six months to a year.
Holguin said not every state gets the grant funds. Nevada had received the money before losing it for one year.
Trade has fallen from where it was in recent years because of a downturn in the mining industry, but there’s been an increase in other sectors, Sanchez said. The five largest trading partners are Switzerland, India, China, Mexico and Canada, he said.