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Websites help manufacturers open the door for exports

When AirSep was founded in 1987, the Internet boom was still several years away. Connecting to customers in other countries via a company website was not yet an option.

But that did not stop AirSep from steadily building up its exports, which now account for nearly half of its total sales. The Amherst-based company, which makes medical and industrial air separation equipment, sells its products into more than 100 countries.

AirSep and some other companies say exporting makes them less dependent on economic conditions in the United States, while opening up an array of additional markets for their products. The foreign sales pay off at home, in the form of jobs and investment in their facilities.

Websites have helped make exporting a much more accessible concept for manufacturers, allowing immediate contact with potential customers in other countries. But experts say companies still need to determine how to use the Web to their advantage and research which countries are the best potential fit for their products.

In the case of AirSep, the Web has augmented its export business, giving potential customers a way to reach out to the company. But when it has established a sales presence in a new country, AirSep over the years has used a combination of research, patience and commitment, said Joseph L. Priest, AirSep's president and chief operating officer.

The company looks for the right distributors and gives the market time to evolve, he said. For instance, as a developing country modernizes, its government tends to assume a greater role in the health care system, as the country shifts away from a "private payer" system. That transition creates a bigger market for products AirSep makes for individuals with medical conditions.

AirSep has grown into a significant employer, with 340 people -- nearly all of who are locally based -- and revenues of about $120 million, he said.

"Fifty percent of our business is exports, so that directly relates to the number of employees we hire," Priest said.

AirSep goes up against foreign competitors who sell cheaper products, a challenge familiar to manufacturers. But Priest said his company emphasizes its products' advantages in quality, and focuses on keeping its own costs under control. Its manufacturing operations remain in Western New York.

"I think we've been fortunate to have a very dedicated group of people here," Priest said. "We have a lean operation relative to our revenues, and that's the way we've been able to remain competitive."

Some other area companies also have found exports to be a vital source of sales.

Cameron Compression Systems' Cheektowaga plant exports about 75 percent to 80 percent of its work, and its business outside the United States has been strong. It expects to see growth in demand for its products in South America, India, Russia and China.

Cameron's local plant designs and makes gas and air compressors for a variety of applications, including industrial plants. The company says many of its customers insist on a "Made in the U.S.A." stamp on the products they buy because of a perceived value of high quality and dependability.

The 650-employee plant is sold out or booked to capacity for 2011 on the centrifugal compressor side of its business.

In Clarence, Innovative Concepts in Entertainment, or ICE, makes coin-operated games for the amusement industry and sells them into more than 50 countries. Exports account for about 30 percent of its annual sales.

Ralph Coppola, ICE's president, said the company's global sales presence is one reason ICE has managed to remain in business for more than 20 years. Certain foreign markets might be up when others are down, as with different currencies, he said.

General Motors Co.'s Town of Tonawanda engine plant recently received a boost from exporting. It was able to call back 37 laid-off workers due to parts shipments to a GM joint venture in China.

Some manufacturers interested in exporting turn to resources like the U.S. Department of Commerce, the Erie County Industrial Development Agency, World Trade Center Buffalo Niagara, the Small Business Administration and the Export-Import Bank to get help.

Rosanna Masucci, senior international trade specialist with the Commerce Department's Export Assistance Office in Buffalo, said Buffalo-area businesses often have more experience in exporting than they give themselves credit for. They will mention they already sell into Canada, without thinking of that as exporting, she said.

Selling into Canada can be a good way for to break into international sales, Masucci said. Canada is close by and familiar, but it presents some differences to give companies a taste of what to expect in areas like regulations when selling into another country.

Some companies develop interest in exporting when they begin to receive inquiries about their products from overseas via their websites, Masucci said. With the dollar weak, U.S.-made goods are cheaper and more appealing for customers in other countries to buy.

The Commerce Department can also provide market research on countries, drawing upon resources such as embassies and consulates around the world, she said. And trade fairs certified by the Commerce Department offer a way for companies to make valuable overseas contacts, without shouldering all of the logistical responsibilities that come with being part of such events.

Websites are integral for connecting with export customers. But companies can go deeper with the information their sites collect, using an analytics program to determine from which countries its web pages are drawing visitors. That data can help identify which markets might be the best targets, Masucci said.

Koike Aronson, an Arcade-based manufacturer, learned an important lesson about the Web when it discovered much-smaller competitors had somehow won big projects in Mexico and South America.

The competitors' Web presence turned out to be the difference. Koike Aronson then bolstered its page, making it accessible in foreign languages and more responsive to inquiries from customers.

Manufacturing jobs are valuable to Buffalo Niagara's local economy, averaging more than $55,000 in wages annually in 2009, according to state Department of Labor data.

But there are increasingly fewer of those jobs to go around. Through November, manufacturing employment in Buffalo Niagara averaged about 47,400 jobs, according to Labor Department data. The region's annual average has fallen steadily since 1995, when it was 85,000 jobs. In 1990, the average was 92,600.

A Brookings Institution study of exporting last year demonstrated how manufacturing remains influential in jobs as well as the value of exports from the region.

The sector that accounted for the greatest share of Buffalo Niagara's export-related jobs in 2008 was transportation equipment manufacturing, at 14.6 percent of the region's total.

And the chemical manufacturing sector accounted for the largest share -- 25 percent -- of exports that contributed to Buffalo Niagara's Gross Metropolitan Product, a measure of all the goods and services produced in the region.

Recent local and national surveys have indicated improved prospects for manufacturing this year compared to 2010.

The ASQ Manufacturing Outlook Survey said 68 percent of North American respondents expected revenue growth this year, up from 65 percent a year ago. And a local survey of factory activity in November hit its highest level in more than two years before dropping sharply in December.