Global commerce continues to thrive. The level of trade is on the rise and showing no signs of letting up. If you were hoping international business was one of those passing fads, you may be disappointed to know that not only is it here to stay, but doing business outside U.S. borders is a proven strategy to take your company beyond survival mode and onto the growth curve.

Export growth

The U.S. Census Bureau reports that in 2010 United States exports increased by nearly 17 percent to $1.83 trillion over 2009. Some will argue that the economy was so far down the numbers could only go up. That’s probably accurate—and nobody knew what the bottom looked like quite as well as Michigan businesses did. So it may not be surprising to read that Michigan exporters contributed significantly to the nation’s positive growth in exports, up 36 percent to $44.5 billion in Michigan goods and services exported in 2010. These figures are indeed encouraging and moving in the right direction for President Obama’s ambitious goal of doubling U.S. exports in five years.

Realities of a global economy

Those involved in trade are well aware that exports are only half of the trade equation. United States companies are competing on price around the world. Many United States manufacturers rely on imported raw materials and/or components to produce globally competitive finished goods for domestic delivery and/or export. So while exports are indeed helping the U.S. economy emerge from recession, we can’t forget the reality that imports are also very necessary inputs for U.S. production. And in 2010, U.S. imports also increased by 20 percent to $2.3 trillion.

If you did the math, you noticed the U.S. continues to have a trade imbalance—nearly $500 billion in 2010. That doesn’t mean the United States can or should simply stop importing. But we can continue to bring manufacturing back to North America and increase our export efforts. The National Export Initiative (NEI) has several complex components, including expanding free trade agreements, enforcing existing agreements, removing nontariff trade barriers and facilitating trade for U.S. companies.

Grow your local company globally

Port Lansing is one of many regional assets available to help facilitate trade for Michigan companies.  Michigan’s newest inland port of entry was established by the Capital Region Airport Authority in 2008 to help the region increase its participation in global trade and become a global logistics hub.

Foreign Trade Zone No. 275 (FTZ), located at Port Lansing, can help importers and exporters reduce the expenses associated with global logistics and improve operational and supply chain efficiencies.  Businesses utilizing the FTZ program can reduce, defer or eliminate duties on imports—and never pay duties on imported components that are used in exported finished goods. There are also many other financial and operational benefits available through the FTZ program.

Additional FTZ options

Port Lansing recently partnered with Materials Management Solutions, LLC (MMS) to become the FTZ operator for FTZ No. 275.  This means companies now have multiple options to access the FTZ program:

•   Utilize the General Purpose Zone (GPZ) located at Capital Region International Airport and process your imported materials through the GPZ

•   Establish an FTZ on site—at your own facility (called a subzone). Become your own FTZ operator and have your own staff manage daily FTZ activities.

•   Utilize MMS to operate your FTZ activities at your site, or at the GPZ

Each company’s situation is unique, so it takes an in-depth conversation to understand if the FTZ program is a fit. Variables to consider include duties being paid, level of imports, number of customs entries, export activity, inventory control systems, value-add activity, supply chain complexity and more. Port Lansing and MMS staff members are available to evaluate your company’s circumstances to determine if Port Lansing and FTZ No. 275 can be of service to your company.

FTZ service area expansion

Port Lansing has expanded the service area for FTZ No. 275 to include Ingham, Eaton and Clinton counties, as well as Shiawassee, Gratiot, Livingston and Jackson counties and most of Isabella County. FTZ No. 275 is Michigan’s first FTZ to receive approval for expansion under the new federal guidelines called Alternative Site Framework (ASF). ASF simplifies the application process and shortens the approval timeline from 9-12 months to 30-75 days. Businesses located in these eight counties involved in importing and exporting should work with Port Lansing and FTZ No. 275 to “localize” your international and customs activities.

Trends for United States and Michigan exports are moving rapidly in an upward trajectory. Don’t miss the chance to participate in this global growth opportunity. Visit www.portlansing.com or call 517-886-3716 to explore how Port Lansing can add value to your global supply chain.

		Brent Case is vice president of international business services at the Lansing Regional Chamber of Commerce. In this role, Case works with the Capital Region Airport Authority to increase the amount of global commerce being conducted in the Greater Lansing area.