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SMALL BUSINESS | THE LEARNING CURVE: PULSE INSTRUMENTS
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Export Expertise : Agencies Help Firm Forge Foreign Ties

June 11, 1996

Pulse Instruments owner Sylvia Kan always wanted to expand her company's exports, and when the U.S. economy soured in 1990, she got the chance. With the help of a variety of government agencies, she boosted her exports from 10% to 50% of sales. Kan was interviewed by Karen Kaplan.

My husband and I started this company in 1974 to make testing equipment for heat-sensitive imaging devices like faxes, satellites and telecommunications equipment. We sold to aerospace and defense companies and to national laboratories, but business really turned sour after 1990.

At that point, about 10% of our business was with international customers in countries such as France, Germany and Italy. Once the domestic economy got slow, we decided it was time to open new markets in Asia, South America and the Middle East.

The European countries were easy because we had a salesman at the time who had done international sales there. But for the rest of the world, it was harder to think of who might buy our equipment, especially since some of these markets were only 15 years old.

We started with the Department of Commerce. We were on their mailing list, and that's how we found out about their programs to help you go into new countries and find representatives for your products. They do shows where you send catalogs about your company, and locals can contact you if they're interested.

I also went on a trade mission to Brazil with the Commerce Department. I told them about the kinds of customers we have in this country and they tried to match us up with corresponding companies there and set up meetings.

The Commerce Department can also give you information about the idiosyncrasies you might come across in other countries. It's important to know about those because you can insult somebody without even knowing it.

We also got help from the Export Small Business Development Center, a nonprofit organization that is state- and federally funded. They have a lot of experts on other countries and their advice is free. I thought we would have to hire a lot of consultants to get help with all of this, but these agencies saved us a lot of money. If we had gone to a private consultant, it probably would have cost between $20,000 and $25,000.

The one agency that really saved us was the California Export Finance Organization, which is part of the state Trade and Commerce Agency. Our bank had been foreclosed upon and our credit line was frozen, but we needed money to finance our export deals. CEFO guaranteed 90% of our short-term loans, and that made banks more willing to lend to us.

We went into this process thinking of it as a long-term commitment--otherwise it wouldn't be worth it. It takes a long time to build these relationships. Sometimes it takes three years for a sale to materialize overseas.

I was surprised by how many government agencies were available to help us and by the caliber of help that we got from them. Now we're projecting that 50% of our business will be export business by the end of this year.

On her motivation to increase exports . . .

"Once the domestic economy got slow, we decided it was time to open new markets in Asia, South America and the Middle East."

On the value of government agencies . . .

"These agencies saved us a lot of money. If we had gone to a private consultant, it probably would have cost between $20,000 and $25,000."

On her reaction to the public resources . . .

"I was surprised by how many government agencies were available to help us and by the caliber of help that we got from them."

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

AT A GLANCE

Company name: Pulse Instruments Co.

Owner: Sylvia Kan

Nature of business: Manufacturer of testing equipment

Location: Torrance

Year founded: 1974

Number of employees: 27

Annual sales: Projecting $45 million for 1996

SYLVIA

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