In the aerospace business, long-term relationships matter, says Marc Nemeth, president of Jonal Laboratories.
That’s one reason the Meriden aerospace parts maker sends its executives overseas to industry trade shows to meet with potential customers.
“If they don’t see you for two to three tradeshows in a row, they don’t think you’re a long-term player,” Nemeth said. “We feel comfortable saying that we have to look three to five years from initial contact to where you’re starting to do business.”
Jonal Laboratories is among a growing number of Connecticut companies attending international trade shows to develop new business opportunities.
Fourteen Connecticut firms, for example, attended the Paris Air Show in June — the state’s largest contingent yet.
Using federal funds, the state in recent years has partially reimbursed more than 200 companies for international trade show trips.
Business and economic development officials say the international exposure boosts Connecticut firms’ ability to find reliable overseas customers. That’s critical, experts say, at a time when many firms are convinced the global marketplace will be the only way to grow their business.
Building overseas relationships, however, isn’t exactly cheap. Nemeth estimated that sending three executives to the air show last year, when it was in Farnborough, England, cost Jonal around $22,000.
The state’s Office of International and Domestic Business Development (OIDBD) reimbursed Jonal about $5,000 through a State Trade and Export Promotion (STEP) grant, funded by the U.S. Small Business Administration.
STEP has brought to Connecticut $886,000 over the last two years, which has helped send companies to shows around the world, including air shows in Paris and the United Kingdom; a medical device show in Germany; and a September Department of Commerce trade trip to Australia.
The idea is to make it cheaper for Connecticut firms to forge international contacts and sales leads, in the hopes that more foreign dollars will make their way into the Nutmeg State. “One area we have seen some growth lately is in exports,” said Beatriz Gutierrez, director of OIDBD, which is part of the state Department of Economic and Community Development. “So we felt it was important to do more in that area.”
Connecticut firms agreed to $48 million in anticipated sales with customers at the Paris show in 2012, according to state officials.
And in Australia, Jonal Labs signed a non-disclosure agreement with a company there to advance business talks, Nemeth said.
Companies aren’t often thrilled with state taxes or regulations, but Nemeth said he appreciates the state’s efforts to help build Jonal’s international business.
Of course, federal grants can be fleeting. Congress has not renewed the STEP program, which expired Oct. 1, for a third year.
With the government shutdown, economic officials are uncertain what funds will be available. Gutierrez said the state has been able to roll some of its STEP funds — the result of canceled trips to Japan and South Korea following an earthquake and geopolitical tension — into a general account to provide some assistance to Connecticut companies in fiscal 2014.
Leveraging limited resources
Though the state has boosted its one-person OIDBD staff in the past two years — adding Gutierrez and an administrator to manage the STEP grant program — it’s still a small team with a big charge to build Connecticut’s ties with China, Europe and other areas of the world. That’s one reason Gutierrez has focused on collaborating with other Connecticut entities to leverage her department’s resources on international efforts. Partners include the The Connecticut Center for Advanced Technology, MetroHartford Alliance, Connecticut Export Council, Jewish Federation of Greater Hartford, Connecticut Economic Research Center, Central Connecticut State University, and UConn.
“With small resources, you have to be very tactical and focused with what you want to do,” she said.
Anne S. Evans, district director of the U.S. Department of Commerce’s export assistance center in Middletown, said her federal office’s collaboration with its state counterparts has increased since Gutierrez was hired.
“Beatriz and I talk a few times a week,” Evans said. “What we all realize is that we have such limited resources, if we don’t work together, everybody loses.”
That interaction has led to OIDBD awarding STEP grant money to Connecticut firms going on Department of Commerce trade trips. And Evans’ office provided client matchmaking services to companies on the OIDBD trip to the Paris Air Show.
The other leg of the state’s international strategy is to try to attract foreign firms to invest in Connecticut locations or companies. To do so, OIDBD has developed a concierge program with CERC, CCSU and others to assist companies visiting Connecticut shopping for possible locations.
Gutierrez said a start-up Israeli IT company recently opened a Fairfield County office after working with her office. She is also talking to three other foreign firms (from Japan and the Netherlands) about possible Connecticut locations.
Gutierrez said relocation victories will come — she feels the state and its partners have laid the groundwork and expects to spotlight some moves in 2014.
“It takes a while to get the results that are going to be significant,” she said. “This is a long-term play.”
Correction: The original version of this article inaccurately characterized recent trade trips to Australia and China. The Australia trip was organized by the U.S. Department of Commerce. Gov. Dannel Malloy did not go on the trip. Beatriz Gutierrez did not attend the 2012 China trip and will not attend a DoC Israel trip later this year. Also, the 2012 air show was held in England.
