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Wisconsin business exports on track to break record

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Photo by Dan Lassiter

John Fowler, left, and Larry Baldwin build the enclosure for an ANGI compressor.

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Photo by Dan Lassiter

Jennifer Riedl installs wiring for a programmable logic controller used to run one of the company's compressors at ANGI Energy Systems in Janesville.

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JANESVILLE — Rock County companies are contributing to what could shape up as a record year for exports from Wisconsin businesses.

Through the first three quarters of this year, state businesses exported $17.4 billion worth of products, according to the Wisconsin Economic Development Corp. That’s year-over-year export growth of 6.4 percent, and it betters U.S. export growth of 5 percent.

“If exports continue to grow at this pace in the final quarter of the year, they would total $23.5 billion and break last year’s record of $22 billion,” Lora Klenke, the agency’s vice president of international development, said in a news release.

Leaving Rock County

In the last seven years, Rock County businesses that export goods hit a peak in 2008, shortly before the Great Recession.

Local exports dropped off through 2011, but several local manufacturers said 2012 will be a strong year.

One of those is Hufcor, the world’s largest manufacturer of operable partitions, accordion folding doors, glass wall partitions and portable walls. Its products are installed throughout the world in hotel meeting rooms and ballrooms, schools, religious buildings, convention centers and corporate facilities.

“Last year was a record year for us in that 20 percent of what we made in Janesville left the country,” said Mark Blanchard, Hufcor’s vice president of sales and marketing.

This year will be the same, Blanchard said, noting that the Janesville plant supplied the world’s tallest operable panels for an installation in Qatar.

For many years, the Janesville plant exported about 5 percent of its production. That changed in 2011, however, as the company sought new business to offset a struggling domestic market.

Significant portions of Hufcor’s exports are bound for the Middle East, Central Asia and Latin America, Blanchard said.

As those exports have grown, the company has changed some of its culture at the facility on Kennedy Road that employs 250 people.

“We’ve brought in bilingual employees, changed some hours here to deal with different time zones and trained our people differently,” he said. “There’s no question our export growth helps the Janesville plant.

“Without that business, we’d be 20 percent smaller here.”

Greener grass?

ANGI Energy Systems, which moved from Milton to Janesville earlier this year, is in a different situation.

In typical years, the manufacturer of natural gas compression equipment might export 50 percent of its production, said John Grimmer, chief executive officer of the company that now employs 160 people in the former ThyssenKrupp/Gilman facility on Delavan Drive.

“Our exports are down in total but only because our domestic business is up so significantly,” Grimmer said. “It’s much easier to do business here than some of the places we have around the world.”

Depending on future markets, that could change.

“If the industry stays strong in North America, we won’t have to look as widely for work,” he said. “If we have to increase exports, we will because we know how to do it, and we do it pretty well.”

RathGibson, a Janesville manufacturer of precision tubing and pipe, exports about 20 percent of its product, said John Fortin, the company’s vice president and general manager.

“We had significant large orders into India, Korea and China this year that helped our business,” he said.

Size doesn’t matter

Industry analysts say exports have grown in part because the recession forced U.S. manufacturers to find new business. In addition, a weak U.S. dollar made U.S. products more competitive in other countries.

Those analysts also say export growth is no longer exclusive to large manufacturers.

That’s evident at Performance Micro Tool, a small manufacturer in Janesville that designs and produces some of the smallest drills, routers and end mills in the world.

The company’s high performance products are used in the medical, aerospace electronics industries, as well as advanced academic research.

While 2012 has been challenging—the company invested in new equipment—sales are up about 11 percent, said President Dave Burton.

Typically, the company’s business is evenly split between domestic and export markets. As a niche provider of small carbide cutting tools, the company ships a lot to India and serves the cataract lens industry.

Customers tend to find Performance Micro Tool, he said.

“We really like the export business,” Burton said, adding that it provides a necessary complement to the company’s domestic business.

Burton said he has found that doing business in foreign lands is nowhere near as difficult as it’s often portrayed, particularly for a small company.

“I look out there and see so many opportunities,” he said. “If you’ve got a good business and a website, you can do business around the world.”

Locally, the Stateline World Trade Association is an organization that promotes an understanding and appreciation of the international marketplace, said Amy Loudenbeck, the group’s president.

“We’re always hearing stories of growth in exports to new markets, and that keeps our members positive,” said Loudenbeck, who also represents the 31st Assembly District. “A lot of companies are looking at ways of improving their bottom lines, and that can involve exports.”

In the Rock County area, much of that involves grains, she said, noting that the DeLong Co. in Clinton has often been recognized and honored for its export business.

“But many of our ag-related exports are not grain,” she said. “They are value-added products such as proteins, nutritional supplements, genetics and the equipment that supports them.

“Emerging markets like China don’t want our milk; they want our technology.”

Group offering seminars for help with exports

Help is available for small to midsize manufacturers in Wisconsin that want to develop and execute an export strategy.

The Wisconsin Manufacturing Extension Partnership plans to launch another round of ExporTech seminars at several locations in the state in 2013.

The seminars comprise three intense events scheduled one month apart. They provide targeted training and support from export specialists to boost speed-to-market.

Representatives of Hufcor, a Janesville manufacturer of operable partitions, accordion folding doors, glass wall partitions and portable walls, participated in ExporTech in Milwaukee earlier this year.

Mark Blanchard, Hufcor’s vice president of sales and marketing, said the program helps companies identify the basics of an export journey and develop an appropriate itinerary.

“The program uses a lot of experts and shares a lot of perspective to help Wisconsin companies,” he said. “We enrolled in it to focus on specific plans to export our newly developed products as well as to identify the internal changes we should be making to be better suited to handle the export business as it grows.”