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Small businesses are the engine of our economy, creating nearly two-thirds of net new jobs.  A critical subset of this sector are small exporters.  Firms that export grow faster, generate more jobs, and pay higher wages than other businesses.  Clearly, to continue growing our economy, we must expand small firms’ participation in global commerce.

Despite the advantages stemming from trade, it remains exceedingly difficult for small companies to enter foreign markets.  Just one percent of small businesses in this country are exporting their goods overseas.  

And even though small and medium-sized businesses account for 97 percent of American exporting companies, their exports account for only a third of all U.S. goods shipped overseas. 

The challenges small firms face are multi-faceted. It takes time to identify foreign markets, target new customers, and learn the “ins and outs” of the exporting process. Nearly 40 percent of small businesses say they do not export because they simply do not know where to start. 

Compounding these obstacles is that they often have fewer resources to expend on developing a trade strategy or complying with complex regulations.  

As a result, they consistently enter fewer foreign markets than their larger counterparts. About 60 percent enter only one, while more than half of large firms export to five or more markets.  

Across the federal government, many agencies have export promotion programs that help businesses enter foreign markets. On top of that, many state and local governments also provide export assistance. This support can take the form of lending, counseling, marketing, trade missions, and technical assistance.

For small businesses, identifying which programs are available and how to access them can prove a daunting task, particularly when programs are administered across so many government agencies.

Promoting coordination between federal, state and local agencies not only encourages government efficiency, but also ensures small businesses can navigate and use the resources available to them.

The Trade Promotion Coordination Committee is tasked with ensuring such coordination takes place. While I commend the Committee’s efforts to improve partnerships and coordination in recent years, there is more work to be done, particularly regarding small firms.

I would like to thank our witnesses for taking time to be here today. I look forward to hearing how you are working to coordinate efforts to best serve our small businesses.