Posts filed under 'Export'
October 2nd, 2008
Yesterday I was in a conversation about Rockford Area Manufacturers going Global…what is that? Who can participate? Do you have to have a product line? Is it for a small, 11 person, company like mine that provides services to other manufacturing companies?
My old pocket Webster’s says global means “of or pertaining to the entire world.” Adjectives for global are —broad, general, universal, urban, widespread and worldwide. Are we interested? Why should we be?
Those who support Manufacturing are encouraging us to think about going global. The Rockford Chamber is having a Globalization conference on Oct 29th, at Eclipse. They are encouraging Rockford Area Manufacturers to participate in the “worldwide” marketplace. RAEDC has staff members who belong to the Swedish American Chamber of Commerce. They are spending time and dollars to encouraging us to particpate in business outside of our region—on Swedish soil or here with someone from Swedish soil. Patrick Hope is a government representative placed here to help us work with any country in the world.
Why would you go to a conference on Globalization?
Information is good! Being informed about the global climate helps as you make business decisions.
Find out if your customer is being effected by pressures that make your solution maybe not the best solution in the marketplace–or maybe it is the best solution and then you can get ideas of who else to sell to.
The other companies that attend might be companies you would like to talk to but you cannot get past the receptionist.
Maybe there is a way you can make a lot of money!?
Are there more reasons….?
A few years ago we really focused on getting to know the manufacturing companies and capabilities of our region. That has been a huge success; I believe part of why our region is still leading the way for manufacturing in the USA. Now let’s think about broad, general, universal, urban, widespread and worldwide…..global.
September 19th, 2008
I attended today’s meeting sponsored by the Rockford Area Economic Development Corporation. The speaker was Rebecca Steffenson from NIU and she reported on the Global Economy Survey that was conducted recently with a number of local manufacturing companies. I completed the survey, so I wanted to know what the results were. RAEDC will be posting the complete survey on their web site, but here are a few factoids:
1. The Rockford Metro area (Boone and Winnebago counties) exports $1.2 billion to international markets representing 2.3% of the state’s exports and ranks 106th in the U.S.
2. Size of the companies surveyed were 11.1% employed 10-20 workers; 35% employed 21-100Â workers and 54% employed 100+ employees.
3. 77% of the companies surveyed export.
4. 42.1 of the companies had export sales of0-5% of their sales; 31.6 of the companies had export sales of 6-15%of their total sales while 10.5% had exports  16-20% of their total sales.
There were many other charts and pieces of data explaining advantages and disadvantages to the Rockford location; how companies go about finding export business and other factors relating to this business.
An interesting survey with good information. Check RAEDC’s web site to get the full story.
September 18th, 2008
From Times Online
September 18, 2008Â (Chris Helgren/Reuters)
Alitalia had been flying the flag for Italy over the last six decades
Richard Owen in Rome
The bankrupt Italian airline, Alitalia, collapsed today after a consortium of Italian industrialists withdrew its offer to buy the carrier.
Silvio Berlusconi, the Prime Minister, said: “We are facing the abyss.” Luigi Angeletti, head of the UIL union, one of three unions that had accepted the bid by the Italian Air Company (CAI), said that the collapse was “a catastrophe for Italian society and trades unions”.
The collapse comes after weeks of brinkmanship, with unions banking on being able to squeeze further concessions from the consortium and calculating that Mr Berlusconi, who had put his prestige on the line to find an “Italian solution”, would not allow it to fail.
The end of the talks spells doom for a carrier that has been a proud national symbol of Italy for more than six decades, flying the Italian tricolour, but which has suffered from chronic labour disputes and mismanagement, aggravated more recently by crippling fuel costs.
The takeover consortium had laid down a deadline of 3.50pm local time for the airline’s nine unions to back it. As the deadline neared, Maurizio Sacconi, Italy’s Labour Minister, admited that Alitalia’s future was “hanging by a thread”.
After the deadline passed the group of investors, led by Roberto Colaninno, chairman of the scooter manufacturer Piaggio, withdrew its bid. With no other offers on the table, Alitalia’s administrator, Augusto Fantozzi, said that this would mean the airline now faced liquidation proceedings. There were shouts of protest and dismay from Alitalia workers demonstrating outside the CAI meeting as the news emerged.
Mr Berlusconi has said that the airline’s 20,000 workers cannot expect generous redundancy packages in the case of liquidation. Mr Fantozzi said that although previous deadlines had come and gone, this time Alitalia simply had “no cash left to continue”.
Alitalia, founded in 1946, needs €1.4 million (£1.1 million) a day for fuel and loses a further €2 million a day, adding to debts of €1.17 billion recorded at the end of July. The CAI consortium had offered to inject €1.5 billion into Alitalia and merge it with Air One, Italy’s second largest carrier.
Three of the four larger unions said that they could accept the deal, but smaller ones, including those representing pilots and flight attendants, objected to the proposed loss of more than 3,000 jobs and new contracts laying down longer hours for the same pay.
Fabio Berti, leader of ANPAC, the pilots’ union, said that his members were prepared to make “extraordinary sacrifices” to persuade CAI to change its mind and return to negotiations.
Despite the crisis, Alitalia’s planes continued to take off and land normally. Fifty flights were cancelled today, but the airline said that this was because of a one-day strike by a small trades union.
Mr Berlusconi, who had earlier said that he was “still optimistic”, blamed the leftwing union CGIL, which held out against the deal, for causing the crisis. CGIL had tabled a counter proposal together with the pilots union and other smaller unions involving further negotiations, but CAI members said that it was too late.
The CAI offer called for 3,250 layoffs and generous benefits of up to 80 per cent of pay for eight years for those who lost their jobs. But Mr Berlusconi gave warning this week that this offer would not apply in the case of liquidation.
The previous centre-left government of Romano Prodi started the process to sell the Government’s 49.9 percent stake in the airline nearly two years ago. After an auction failed, the airline entered into talks with Air France-KLM, which made an offer.
However Air France-KLM withdrew this Spring because of “unacceptable” union conditions, and because of alleged lack of support from Mr Berlusconi, who was fighting en election campaign at the time and vowed for patriotic reasons to “find an Italian solution”.
The CAI plan also involved a foreign airline taking a minority stake in the new Alitalia. Mr Sacconi had claimed that British Airways, Air France-KLM and Lufthansa were all interested. Maintenance and freight operations were to have been sold off.
The Government made a €300 million emergency loan to Alitalia in April, but under EU rules could not pump in any further state aid. It has spent €5 billion of public money over the past 15 years to keep Alitalia afloat.
Alitalia is the first major European flagship airline to collapse since Swissair Group and Belgium’s Sabena in 2001. Greece said yesterday that it would also shut down its ailing state carrier, Olympic Airlines, and relaunch it.
In a statement CAI said that the “dramatic situation” of Alitalia and that of the international markets did not allow any further scope for negotiations, in which “numerous concessions” had already been made. The consortium was “deeply disappointed” that a plan that could have given new life to the airline despite the current “difficult moment for the airline sector and the economy as a whole” had been rejected.
CAI said that one of the most important conditions attached to its offer had been the attainment of a broad agreement with the unions on new contracts. “Such an agreement was not reached,” the consortium said, adding that only three unions — CISL, UIL and UGL — had accepted the terms.
Mr Sacconi said the failure of the talks was the “logical consequence” of the “absurd obstructionist position” taken by CGIL and its allies, including the pilots’ union. However Guglielmo Epifani, head of CGIL, said that the union would “not be a scapegoat. We accept our share of responsibility, but so must the Government”.
September 18th, 2008
Leading Edge Hydraulics has reached a business deal to establish a new company that will be based in Sweden.
The new company will be called Leading Edge Hydraulics AB and will be based in Lidköping, Sweden. It will service Leading Edge’s customer base in Europe, providing equipment for companies like John Deere, Hitachi, Caterpillar and Haldex.
The newly formed company is expected to create new jobs for both companies. “This is very exciting for us because it is our first step into making a foreign direct investment. We’ve been exporting for several years and our customers have been asking us to fully service their needs globally,” said Leading Edge Hydraulics Vice President and Chief Technology Officer Russ Dennis.
The new company will start shipping product early next year. Dennis said, “We’re looking very much forward to be able to create this new joint venture in Sweden, to be able to serve European markets and we’ll see where it goes from beyond there as well.”
But this deal has been a couple years in the making, since Rockford leaders took part in Stockholm’s Entrepreneur’s Day (E-Day) in 2006. That’s when Mayor Larry Morrissey networked with Lidköping’s Mayor. Morrissey said, “That’s a great start but ultimately, I think this is a message to other Rockford businesses that those opportunities are here.”
The Rockford delegation in Sweden include Winnebago County Board Chair Scott Christiansen and representatives from the Rockford Area Economic Development Council.
Now Mayor Morrissey’s on board a plane to china to meet with businesses and government officials in several cities in China.  Janyce Fadden, Rockford Area Economic Development Council President, said the Mayor will meet with the “Civil Aviation Authority of China and that meeting is to talk about opening up our airport as a potential landing place for Chinese aircraft.”
This is the first big news to come from the Rockford delegation’s trip to Sweden and China.
See the WREX story here…
http://www.wrex.com/Global/story.asp?S=9026429&nav=menu1352_2
September 17th, 2008
Good news, bad news…good if you’re going there for business, bad if you’re exporting there…..
David Blanchflower, the arch-dove on the Bank of England’s Monetary Policy Committee (MPC), today forecast that the UK economy is heading for an “unpleasant shock” with unemployment set to spike in October.
Sterling fell to a two-and-a-half year low against the dollar as markets digested Mr Blanchflower’s comments, sending the pound down to $1.7460 — a level last seen in April 2006.
Speaking before the Treasury Select Committee, Mr Blanchflower’s “doom-laden view” of the economy included forecasts the UK would “see a large rise in unemployment”, to the tune of an extra 60,000 a month for “several months”.
Unemployment is currently running at 1.67 million, or 5.4 per cent of the population in the three months to June.
Read the rest of the story…http://business.timesonline.co.uk/tol/business/economics/article4730740.ece
September 11th, 2008
Soaring energy costs, the falling dollar and inflation are cutting into what U.S. manufacturers call the “China price”– the 40 to 50 percent cost advantage once offered by Chinese producers.
The export model that has powered China and other Asian countries for three decades will be compromised if fuel prices continue to rise, said Stephen Jen, a managing director for Morgan Stanley.
“Globalization has gone a little bit too far. It has overshot,” Jen said. “We’re not saying Asia is going to crumble, but we are saying Asia enjoyed extraordinary conditions in the past. Now the conditions are changing very quickly because of the energy shock, and Asia is coming under pressure.”
The ripple effects have been far-reaching. The trade imbalance between the United States and China — a source of political tension for years — is beginning to right itself as Chinese exports fall and U.S. exports rise. Global trade routes are being transformed, suggesting a possible return to a less integrated world economy.
Read the rest of the story in the Washington Post….
http://www.washingtonpost.com/wp-dyn/content/article/2008/09/07/AR2008090702262.html?sub=new
August 28th, 2008
 US GDP rebounds with 3.3% growth
 Tax rebates have encouraged consumers to spend more |
The US economy grew at a revised 3.3% annually in the second quarter of 2008, the Commerce Department said, much higher than its first estimate of 1.9%.
The rebound was linked to strong US exports, helped by the weak dollar, while government tax rebates also boosted consumer spending.
GDP grew at a rate of 0.9% in the first quarter, after a 0.2% contraction in the last three months of 2007.
The Federal Reserve has warned the economy will remain weak this year.
“While we’re not out of the woods yet, maybe we’re beginning to see some sunlight,” said John Wilson, equity strategist at Morgan Keegan.
“At some point, the market will begin to look through the trough and gauge the strength of the coming upturn.”
‘No recession’
The data showed that exports grew at an annualised rate of 13.2%, higher than the government’s initial estimate of 9.2%.
Imports fell at a rate of 7.6% as the US economic slowdown reduced demands for goods made overseas.
The improved trade balance added 3.1 percentage points to second-quarter GDP, the biggest since 1980.
The slowdown in the housing market was evident, as builders cut back and businesses reduced their spending.
Consumer spending, boosted by the government’s $600 tax rebate payments, rose by 1.7%, slightly higher than the previous quarter’s 1.5%.
Some observers said that the figures lent support to the argument that the US was not heading for a recession.
“For a recession the economy is certainly growing very quickly,” said Avery Shenfeld, senior economist at CIBC World Markets.
“A lot of that growth is driven off exports and pessimists might say that can’t continue during slowing growth overseas.
“But I would say this happened precisely during the period of slowing growth overseas … this is still an economy that faces slow times but not a recession.”
Courtesy: BBC News.UK
August 21st, 2008
Growth in U.S. manufacturing will be led by exports, capital investment and growth abroad…
http://www.industryweek.com/ReadArticle.aspx?ArticleID=17047
July 28th, 2008
After several weeks of e-negotiating with my contact in Shanghai, it looks like I will have an agent there covering 6 eastern provinces of China. We e-discussed drawings, payment terms, shipping arrangements, target industries and target sales volumes. I will be sending him a DVD with all pertinent information so that his 8 sales people can go after new business for my company.
This process started with my attendance at the “Go Global” seminar in May, followed by my working through the State of Illinois Trade Office. They were helpful in putting me in contact with my new agent and lent advice along the way. This is a good example of our state tax dollars at work!
I will conclude this series now and I hope these Export posts will be helpful to others who want to penetrate a new market like China.
July 24th, 2008
Ever wonder why export sales in the summer fall off for a while?
Europe has a practice of closing their factories from 2-4 weeks each summer so all employees can enjoy that period of time. By all employees doing this at the same time, no one is pressured to “stay in touch”. My Italian customer closes for a 4 week period in August so we typically don’t ship orders for a 4 week period. France has a different time period. The Netherlands has a system that divides the country into thirds and each year they rotate which third goes on vacation, each third doing it at a different time.
So if you want to get confused about vacation times in Europe, try shipping to each country!
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