How To Help A Nutcase
PORTLAND’S HELMET EXPORTER SHOWS THAT THE NEW OREGON TRAIL LEADS TO FOREIGN MARKETS
Michael Morrow, founder and chief executive of Portland, Oregon-based Nutcase Helmets, is convinced that to grow his company beyond its 30 worldwide markets, his bicycle helmet brand needs to be picked up by bloggers, website writers and social media, particularly in Japan.
To help reach his goal, Nutcase participated in an April 2014 Portland Development Commission (PDC) trade mission to Japan, a nation where it already enjoys success.
“The Japanese have a love affair with design and Portland’s affinity for sports and the ecological way of living,” Morrow says. “Our goal for that trip was exposure and goodwill, and to add a halo to the Nutcase brand. We hope there’s a ripple effect to the alpha Japanese who are on the cutting edge of finding new, cool products from Portland.”
Founded in 2000, Nutcase designs and engineers its helmets in Portland but has them manufactured in China and shipped to Oregon via the Port of Tacoma, Washington. “We used to use the Port of Portland,” Morrow says, “but there are longshoremen issues. We do not know yet if this current port of choice is permanent for us or not.”
The company is enjoying international success, especially among the Germans and Danes who have a keen sense for design. It has gained global exposure thanks to assistance from economic development organizations like Business Oregon, which provided Nutcase a boost by designing its marketing plan. “They helped us develop a very thorough marketing plan, demographics of typical customers and what we needed to do to be in the top bicycle cities in the country,” recalls Susan Cassuto, Nutcase financial manager.
Other assistance from Oregon included State Trade and Export Promotion (STEP) grants that helped Nutcase attend Euro Bike and ISPO—major trade shows held annually in Germany.
“These shows are wildly expensive and they offer big opportunities,” Cassuto says. “Dealers and distributors always attend. It is where we make networking connections and find distributors.”
STEP also supported Nutcase by developing its international website. “Distributors will have their own websites, but we needed to establish a domain website that would work as a template for all distributors to use,” Cassuto explains. “This provides consistency for the brand.”
Business Oregon, which utilizes a collaborative approach called “TEAM Oregon” to work with local partners around the state, also facilitated Nutcase executives’ attendance at a workshop on the benefits of utilizing distribution warehousing in the Netherlands. They learned that Nutcase could import products directly from China to Europe without having to first bring the goods to Portland.
“The Dutch have good arrangements related to how to file value added tax (VAT) in Europe,” Cassuto says. “Their Port of Rotterdam is also well versed, and bonded warehouses are centrally located. We’ve been there now almost a year.”
Business Oregon’s Global Strategies team helps existing Oregon businesses grow by accessing overseas markets. “Personal assistance is available from professionals located here in Oregon, as well as from the state’s trade representatives in China, Japan, Korea and Europe,” reports Marc Zolton, Business Oregon spokesman.
These offices are staffed by bilingual professionals equipped with both private-sector experience in their markets and knowledge of Oregon products, companies and culture.
Like Nutcase, Giant Loop, LLC, a manufacturer of motorcycle saddlebags in Bend, Oregon, attributes its success accessing overseas markets to Business Oregon’s export assistance through both the Oregon Trade Promotion Program (OTPP) and coordination with federal agencies. Among the help it received were access to export insurance guarantees through the U.S. Export-Import Bank, introductions to U.S. Commercial Service and its overseas services, and financial grant assistance to defray costs for an international trade show in Milan, Italy, where the company finalized a distribution deal with Touratech AG in Germany.
Business Oregon provides Export Assistance grants ranging from $2,000 to $5,000 in matching funds to Oregon companies to help defray the costs of travel and exhibiting at international trade shows. Since 2012, Business Oregon has awarded more than 200 Export Assistance grants totaling $661,000 to 157 companies. Those companies have reported actual and projected sales revenue as a result of these trade show appearances at more than $50 million.
“Business Oregon is actively working on enhancing opportunities for Oregon companies by building on the national focus on promoting exports via the President’s National Export Initiative which aims to double U.S. exports within five years,” Zolton says.
Business Oregon also helped Giant Loop obtain a list of potential export partners in the U.K., access an affordable federal insurance program and, through its office in Japan, prepared an online directory listing for Giant Loop.
“We were really excited to find out these programs existed and that there’s this whole team of people whose job it is to help small business people like us,” says Harold Olaf Cecil, owner and co-founder of Giant Loop.
Business Oregon helps organize and execute business development and trade missions overseas in conjunction with state and local partners, including Governor John Kitzhaber. One company that took advantage is Oregon City’s Benchmade Knife Co., which originally hailed from California before setting up shop in Clackamas, Oregon, in 1990. In 1996, it moved into the 35,000-square-foot facility where it manufactures specialty cutlery. To expand its international foothold, the company received grants that offset costs for a trade show in South America and a trade mission with Kitzhaber to Asia in September 2011.
“In recent months, we have traveled to Asia, Brazil and the E.U.,” says Zolton.
Benchmade has made the most of the export assistance, not only experiencing triple-digit export growth, but also now employing 180 workers and serving customers in 40 countries around the world.
According to Rob Morrison, Benchmade’s now-former director of Marketing and Strategic Planning, the company’s exports have grown more than 180 percent over the past three years. Asia encompasses 35 percent of its exports, led by Japan and China, where its products are especially popular.
PORTLAND’S UNIQUE APPROACH
Complementing Business Oregon, PDC (Portland Development Commission) takes a slightly different approach to economic development and trade promotion. Created by the city of Portland as an urban renewal agency, PDC focuses on four strategies.
The first concentrates on Portland’s leading export industry, computer electronics, which is anchored primarily by Intel. “Our strategy is to focus on increasing the supply chain for Intel in our region with the understanding that the more they export, the more other firms will become part of the supply chain,” comments Chris Harder, PDC Economic Development director.
The second strategy focuses on companies across many industries that PDC deems are “under exporters.”
“These are mainly larger companies that have sold their products or services to one or two markets either by chance or via companies around the world that have sought them out,” Harder explains. By putting together a sophisticated approach that works with the firms to understand their products, PDC takes these firms on high-value business development trips focused less on trade shows and more on connecting them with actual buyers.
“The third strategy is a catch-all,” Harder continues. “It focuses on increasing the number of small and midsize businesses that are thinking about exporting and accessing existing export opportunities via resources in our community such as the Port of Portland.”
The fourth strategy focuses on branding and marketing. “We are known worldwide, particularly for ‘green’ development and clean tech,” Harder emphasizes. “We have found that when Portland leaders travel around the world, they are often asked how Portland does this and achieves high sustainability. They want to learn from us.”
By combining the under-exporter and global-exporter strategies, PDC officials believe they have heightened Portland’s branding and marketing effort as well as developed tools and resources that are unique to the region.
“I don’t think anyone else around the country is doing this,” Harder says. “This is where we have seen most of the success.”
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