Efforts To Promote Exports by Small, Non-Exporting Manufacturers

Gao ID: ID-83-21 January 18, 1983

In response to the administration's view that the expansion of exports would greatly benefit the Nation's economy, GAO reviewed the activities of several federal agencies as well as organizations in the private sector that are attempting to promote exports. GAO focused its attention on small, nonexporting manufacturers.

GAO noted that only 12 percent of the Nation's 252,000 manufacturers export. The Department of Commerce estimated that another 11,000 manufacturers which are capable of exporting could probably be induced to do so. GAO estimated the value of exports that could be obtained by small, nonexporting firms at $4.2 billion annually. Although Commerce, the Small Business Administration, and the Export-Import Bank of the United States offer export promotion programs and services, their efforts have attracted few small businesses to the export market. GAO found that export management companies and banks have not responded to the needs of small manufacturers with export potential. GAO learned that many small businesses do not export because they: (1) have little knowledge of the export market or process; (2) are preoccupied with the domestic market; and (3) perceive that exporting is risky, complex, and beyond their capabilities. GAO believes that trade missions and fairs could be particularly useful to small, nonexporting manufacturers by providing individualized assistance to overcome their lack of familiarity with the export market.

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