Industry Watch

Cultural exposure: Members of a trade mission learn about history and culture, too

On a mission

For small Minnesota companies looking to export, joining a trade mission can be just the ticket

Dave Anderson, international sales manager for Jet Edge in St. Michael, has been on three trade missions since 2008. As a result of his trip to China in 2010, Jet Edge, a global designer and manufacturer of waterjet systems, set up an office in Shanghai to assist with its export business. And last year, Anderson returned to China on another mission, visiting other cities in addition to Shanghai.

"It was good to go back with the governor's delegation," he says. "When you're traveling with him, you get to meet high-level people quickly."

That's just one of the reasons small businesses like Jet Edge participate in trade missions to some of the state's most important foreign markets. For many such companies, a trade mission is an effective way to build successful export relationships.

The Minnesota Trade Office (MTO) facilitates one trade mission with the governor each year, with the delegation varying in size from 30 to 50 people. Additionally, sometimes an employee from the MTO or Minnesota Department of Agriculture leads a small-business trade mission of about 10 participants.

The destination of a mission is often one of the state's top export markets or investment sources, but the location also depends on where previous trade missions have gone and which countries the MTO wants deeper relationships with.

"China has been a frequent destination for trade missions," notes Katie Clark Sieben, commissioner of the Minnesota Department of Employment and Economic Development and former MTO executive director. "Every governor has led a mission to China since Governor Perpich."

The goal of a mission is to help delegates learn a market and make connections through direct experience and one-on-one meetings. Each mission begins with briefings from the embassy providing geopolitical and business overviews of a particular country. Delegates are also able to meet ambassadors and U.S. Commercial Service officers and participate in tours of key companies.

"On the China trade mission [last year], we took the Minnesota dairy producers to a dairy processing plant so they could see the differences in processing dairy there," says Clark Sieben.

The MTO hopes that Minnesota companies will, after learning about the differences in manufacturing and distribution, figure out the best ways to sell into that market. Other activities include market presentations, networking receptions, and meetings with government officials and key industry groups.

"The governor can help open doors for them," Clark Sieben says. "If we call a company in Germany or China, they are often willing to open their doors to delegates and share information."

Trade missions are also a safe way for Minnesota companies and agricultural producers to explore a new market. All trip details are preplanned and arranged, including one-on-one business meetings and contact with the embassies.

From June 12 to 21, Governor Dayton will lead a trade mission to the European business centers of Berlin, Dusseldorf, Cologne, Oslo, and Stockholm.

According to the MTO, Germany is Minnesota's fifth-largest trading partner and one of its largest foreign investment partners. Norway and Sweden are both highly competitive markets, yet are relatively easy to enter for Minnesota companies, offering export opportunities in many industry sectors.

"We haven't had a Minnesota governor visit those countries in quite some time," Clark Sieben says. "We have deep ties with [those countries], and there are lots of individual and company connections."

Big recognition

Travel companions: WindRider’s Robert Sanberg with Governor Mark Dayton in Xian

Traveling with the governor can be especially beneficial for small and midsize businesses, which otherwise wouldn't likely have the kind of access and exposure the delegation affords. "We are a small company, so it helps to be in a delegation like that," says Anderson "Otherwise, they wouldn't recognize who we were.

"If you are a business wanting to export, I would always recommend it," he adds. "The benefits are far-reaching."

During last year's trip to China, Anderson was able to work more intensively with an existing customer in the United States that had also started doing business in China. It gave Anderson an opportunity to work with the customer one-on-one, he says. The trade office coordinated meetings between Anderson and the customer, one of which included the governor's participation. Anderson has also found the networking events to be valuable, learning from other companies that are also doing business in a particular country.

In addition to participating in pre-planned activities, delegates also have time to set up meetings outside of the itinerary. Robert Sanberg, vice president of operations at WindRider International  a Minneapolis sailboat manufacturer specializing in trimarans  also attended the trade mission to China last summer, which stopped in Beijing, Shanghai, and Shaanxi. Going into the trip, Sanberg (pictured with Governor Dayton) knew that China possessed a growing market for sailboats, especially in parts of southern China like Hainan Island, a major tourist destination.

"Having the ability to get there, meet with people, and talk with people was definitely very important for us," he says. In fact, Sanberg hired someone he met on the trip to act as a local agent for WindRider. Without the trip, Sanberg probably wouldn't have made the contact and established a relationship.

WindRider won't be making the trip to Europe this year, partially because the company already has some distribution there. "Also, it's a market that's a little bit easier for us to get into," Sanberg says. "There's not quite the language barrier that exists for us in China."

Taking part

Any Minnesota company can apply to join a trade mission. Selections are based on a company's ability to increase exports and attract foreign investments for the state. "We try to have a diverse delegation that represents the state of Minnesota well," says Clark Sieben. "We're showing that country how many products and services we have in Minnesota."

The MTO also tries to select companies that represent a diverse set of products. Last year's trade mission to China brought pork producers and corn growers, along with representatives from 3M and Medtronic, and small businesses such as WindRider. And on each trip, there is at least one Minnesotan who has never traveled to another country.

Applications to join a trade mission can be downloaded at positivelyminnesota.com. The cost varies depending on the market; the MTO negotiates rates to make it as reasonable as possible. The cost of the upcoming trade mission to Europe is $7,500 per delegate, which includes all transportation, meals, and activities.

Small companies can get a grant from the STEP program, which provides financial and technical assistance to qualifying small Minnesota businesses with an active interest in exporting products or services. Small businesses can receive up to $7,000 for participation in trade missions.

Sanberg notes it's important for small businesses especially, with their limited resources, to make sure that the trip is going to be worth the time and investment.

Both Jet Edge and WindRider took advantage of the grants. "I've only got so big of a budget, so the STEP program allows us to do more," Anderson says. "I probably wouldn't have gone if it wasn't for the grant."

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