Four Tips Given New Wisconsin Dairy Exporters

The Wisconsin Department of Agriculture provides practical advice. 

In Wisconsin, where license plates read "America's Dairyland," small to medium-sized dairy companies are increasingly looking to export.

Some seek advice from Ashwini Rao, economic development consultant with the Wisconsin Department of Agriculture, Trade and Consumer Protection, an allied member organization of the U.S. Dairy Export Council since 1996.

Rao points out that 95.6 percent of the world's population lives outside the United States. Rao also says that given the huge potential market, it may come as a surprise to some that less than 1 percent of the 30 million businesses in the U.S. export.

Small and medium-sized companies account for almost 97 percent of U.S. exporters, according to the U.S. Department of Commerce's Commercial Service. More than two-thirds of exporters have less than 20 employees.

Yet, nearly two-thirds of small and medium-sized exporters only sell to one foreign market. Many of these firms could boost exports by expanding the number of countries they sell to, experts at the Commercial Service and Wisconsin Department of Agriculture point out.

One of several trade specialists within her department, Rao tells fledgling Wisconsin exporters there are four essentials to achieving success with dairy exports..

1. Management commitment. In order to find success, the company needs to make a long-term commitment with dedicated staff. “It’s good to have somebody (within the company) focusing on exports,” she said. That person needs to understand export procedures and the various role players.
   
   
2. Planning and strategy. It can be daunting: Which country or countries should the company consider? What is the growth potential for the company’s products in those countries? Which countries are the top importers of those products? How are products priced in those countries? What do the consumers in those countries want in terms of product design, quality and functionality?
   
   
3. Finding a distributor. Once a country or region is selected, the company will need to find someone in that country who can act as a sales representative or distributor. The distributor can advise on consumer preferences, pricing, packaging, labeling and other matters. In fact, finding indigenous help is a common theme in this list of success stories from the Wisconsin Department of Agriculture, Trade and Consumer Protection. She suggests going on trade missions or attending food shows in the country or region under consideration. “You need to know who the distributor is, and you need to have a relationship with that distributor before you start exporting,” Rao says.
   
   
4. Awareness of export mechanics. Does the company have the financing and production capacity needed to meet export demand? Is it fully aware of the regulatory and legal requirements for products in other countries? 

Rao outlined these steps at a recent Wisconsin Cheese Industry Conference, as first noted in this front-page article (pdf download) in Cheese Market News.

She refers fledgling exporters to these additional resources:

• The U.S. Dairy Export Council at www.usdec.org and www.thinkusadairy.org
• USDA Foreign Agricultural Service at www.fas.usda.gov
• Food Export Association of the Midwest and Northeast at www.foodexport.org
• Country market guides at www.export.gov
• Information on free-trade agreements at www.export.gov/FTA/FTATariffTool   

“Export planning is not complex, but it is a critical component of a successful export strategy,” Rao says. “Just like any business plan, the steps outlined above form the foundation―and, if implemented correctly, will begin to realize immediate returns.”

The U.S. Dairy Export Council is primarily supported by Dairy Management Inc. through the dairy farmer checkoff that builds on collaborative industry partnerships with processors, trading companies and others to build global demand for U.S. dairy products.