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SMALL BUSINESS: News, Trends and Help for Growing Companies
| AT ISSUE / VICKI TORRES

A Chance for Small Companies to Get Themselves Into the Trade Loop

February 11, 1998|VICKI TORRES

After a decade as California state director of international trade, Greg Mignano did what a lot of other folks do--he went into business for himself as a consultant.

But instead of courting corporate clients and big-money contracts for overseas trade, he focused on small businesses.

With federal Economic Development Administration grants, he established three innovative programs designed to aid first-time exporters: LA Trade in Southern California, Baytrade in San Francisco and Trade Americas in Florida.

With help from LA Trade, 242 Southern California companies have ventured into exporting since 1995. Their foreign transactions amounted to $105 million and helped create an estimated 1,855 jobs.

Plus, an LA Trade/Baytrade Web site with trade leads, trade show calendars and industry and country databases draws 220,000 page viewings a week.

"We have been involved in other programs and none have been as outstanding" as LA Trade, said Tom Teofilo, president and chief executive of the Long Beach World Trade Center, one of four partners with LA Trade.

LA Trade is a "grass-roots program that's gotten out to companies that have never even thought of exporting before," Teofilo said.

Although the program's results are dwarfed by Southern California's annual trade volume of $68 billion, Teofilo said the LA Trade figures represent first-time exporting ventures that, by definition, are smaller in size.

Mignano, head of Calsource International in Sacramento, said he devised the programs as a model for private-public partnerships and to take advantage of extensive federal, state and local trade programs that are not widely known.

"Government as a partner in economic development is too often a well-kept secret," he said.

Plus, small-business owners too often view government as a taxing and regulatory enemy, rather than an aid to business prosperity, Mignano said.

To help bridge the gap, LA Trade was created in August 1995 with a $2.6-million federal grant and matching private funds of $900,000. Partners include the Los Angeles Area Chamber of Commerce and World Trade Centers in Oxnard, Long Beach, Irvine and Riverside, as well as Bank of America, the Port of Los Angeles and Atlantic Richfield Co.

The program's 15 staff members include trade analysts and consultants who provide free, one-on-one trade counseling and steer businesses to government and private resources, financing and aid. Targeted are aerospace-defense companies converting to commercial manufacturing, plus firms involved in telecommunications, computers and electronics, biotechnology, agriculture and processed foods and environmental products.

"Any company that's export ready, we'll work with," Mignano said.

Companies don't have to sell high-tech products to be good export candidates, he said, adding, "One of our clients is a bagel manufacturer."

Companies that export often become stronger by adding overseas markets and avoiding dramatic downturns when the domestic market stumbles, Mignano said. Plus, by competing internationally, the companies gain more technology, marketing and management skills that can help them become leading-edge firms.

But LA Trade has a limited shelf life. Although Mignano is hopeful that a second federal grant will be renewed next month, he said government won't fund the program indefinitely. The program plans to experiment with fees this year in a move toward becoming self-sustaining. In another two years, LA Trade could find itself petitioning local government for funding, or its ideas could be adopted by other export-service providers.

LA Trade is "still in its embryonic stage," Teofilo said. "But maybe we could all take a lesson and follow. Other programs could, in due time, close ranks and learn from LA Trade."

LA Trade can be reached at (213) 580-7528 or http://www.tradeport.org

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Times staff writer Vicki Torres can be reached at (213) 237-6553 or at vicki.torres@latimes.com

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