 Fun, thanks for joining us today on Adventures in Small Business. My name is Jane Sawyer. I'm the district director for the U.S. Small Business Administration and this program where we talk about small business in Hawaii, what's happening, what's trending, what we're doing that works and maybe how we overcame some of those things that didn't work is presented in partnership with our SBA funded resource partners, the Hawaii Small Business Development Center Network, the Mink Center for Business and Leadership, and the Veteran Business Outreach Center of the Pacific, along with, of course, ThinkTech. So thanks for joining us. We have an interesting program today that's going to talk about the launch of one of our favorite programs here in Hawaii, our High Step program. High Step is a program that helps you learn how to export, learn how to get into new markets and then actually helps you with assistance, funding and special programs to get there. So today we're joined by Jamie Lum from the State Department of Business, Economic Development and Tourism, our funding partner and the administrator and promoter for High Step. So welcome to the program, Jamie. Thanks for being here. Thank you for having me. We gave you not a short notice, but I appreciate it because hopefully we can push out this program and get a good response because you're starting in November with a big launch. But why should people be interested in exporting in the first place? Right. Well, thank you, Jane, so much. So the Hawaii State Trade Expansion Program is funded by the SBA and this is the seventh year that we've received a grant, so thank you very much. And why is exporting important? Because it helps our small businesses. Hawaii is a very small market, so it's only logical in terms of growth that they need to get outside of Hawaii. Some will start with the U.S. mainland, but we are really looking to push businesses to look globally because we know that 95% of our consumers are outside of the U.S. So that's really what we're trying to do and to get them out there to reach out and to really get the word out about our unique Hawaii products and services. And that's a really, really good point because Hawaii small businesses do have some great advantages and it certainly helps us all when our businesses decide to sell more products outside the state and even outside the U.S. mainland because it brings new dollars into our economy. Right. They also have a big advantage because we do have some access to markets in Asia that are consumers, they are growing at a terrific rate, and the other thing is they love Hawaii products, they love everything about Hawaii, there's some special cache. Have you experienced that when you help small businesses go out and look for other locations? Exactly, so a lot of businesses find that when they're selling their products here in Hawaii that with the visitors that come that they may attract certain types of visitors, certainly the Japanese are very, very interested in Hawaii products and lots of times it starts with them purchasing gifts for their family and friends when they take it back. Take a little Maggie. Right. Right. So it's a good test for our Hawaii products to see how well their products do with these different markets. So it starts here and then they can, through our program, test out the market to see if it's viable for them. Because that's been one of your very, very successful trade show programs. Is that right? It's the ones you take to Japan? Right. Right. Right. It's been our Tokyo gift show which we just completed in September is our largest show that we do with, you know, homes. Can you give us some idea of the scale of that gift show and how many Hawaii businesses went with you? Right. So they're over, it's a three day show, actually they expanded it to four days. And over 250,000 buyers now, it's not a consumer show so we're just talking about people that are looking for products to put in their stores or to resell. And so over 250,000 people go through the doors. We had this year, I believe we had 58 companies that went to small businesses. Ranging from our coffee and chocolates to people that make koa products, a lot of specialty items, skin care products that are made with Hawaii ingredients. Smell wonderful and bring all that Hawaii right into your home in Tokyo. So we get a lot of traffic, not to mention that we do set up a portion where they can actually purchase, there's ancillary area where they can purchase some Hawaii food. So that also brings people kind of into the area. So we've even had some Hawaii entertainment in the past to kind of draw people into our area. Well, anybody that I've talked to that is gone has found it to be a wonderful experience and very engaging, not just in that they get to sell some more products, but that they experience other buyers, their interests, what they're looking for for other customers. They see what attracts them and what's selling because then they go out into the city and the country as well to see what the people and the consumers are using there. Because some of it has become so big. Do you have any kind of from the small businesses out of those 58 businesses that went with you, what kind of results did they have? I mean, do you measure or find out if they had a beneficial or productive or a zing-zing big orders or anything? Right. We do actually, at the end of every event, promotional event, trade show that we do, we do ask our companies to report to us. That is actually something that we're required to report to SBA so that they can make sure that the funding we're getting is working and that we're getting a return on investment. So we do ask companies to report what actual sales they got. So any orders that were placed at the show, and then we ask them to project out 18 months from that event as to what they think their sales might be as a result of that show. So we've had companies that have participated for many years now, and for people that have done business in Asia, it does take some time to establish yourself. So they'll say, right, right, right. And so if you're a business that's going to the show for the first time, you can't be disappointed if you get nothing because Asian buyers, Japanese in particular, they want to, first of all, they want to see you be there over time so they want to know that you're... You're going to be a reliable supplier. Exactly. And they want to get to know you and get to know the product. So they say usually those people that have done business in Japan say it takes at least three years to really sort of get a foot in there and start getting some orders. But we've had companies report. I had one company that told me that in the last five years since she's been participating that she's increased her sales 300% through exporting. Oh my goodness, 300%. So it's a small company and they're growing slowly, but exporting is why. Yeah, you don't want to grow too fast and have it all collapse on you. So... That will create other problems, right? I'm sure you're counseling them on smart growth as well, right? Through our partners, yes, yes, yeah. We can talk about some of our partners too and what we've done, so yeah. I know some people might be really surprised that they've had such remarkable results, but even from our headquarters and our Office of International Trade, the Hawaii program HighStep is known for getting a good return on investment, and that is one of the strongest measurements. So that's, I think, the duration and the success of the program that you've put together. You've gotten proven results for the invested dollars, but also for the businesses that come and participate. So if somebody who's listening to this program or has been thinking about how they might want to grow their business, how do they get involved? We're starting the launch coming up the first week in November, but what kind of companies are you looking for and what should they expect? So the program is really made for companies ranging from those that are just thinking about exporting to even those that have been exporting but are maybe looking to expand into other markets. So we have three components of the program. We have our export readiness program, which entails training sessions that we've put together, working with our partners at the Hawaii Pacific Export Council. And so we have these training sessions. We have them once a month, normally on various topics, marketing, doing trade shows, yes. And then that's really meant to create a foundation, particularly for those companies that don't know anything about exporting. In fact, we start with a program called Export University 101, which is an overview of really everything that you need to know A to Z. It's a very quick and dirty sort of look at school. And then we kind of get into those topics a little bit more with each session. So we have the export readiness besides the training sessions. We also partner with the SBDC, the Small Business Development Centers, with the MINK Center and with the Hawaii Pacific Export Council to provide business advising for our company. So it's like they get a business consultant for free. For those companies that may be more new to business, we'd probably have them work with the MINK Center, which is they've agreed that they will work with some of the newer companies just on solidifying the business itself. And then SBDC can look at other issues in terms of exporting. And then the Export Council can look at real specific, because of their background, real specific export problems that an experienced exporter might already have. So, and I think it's a good thing to point out too that there are resources available on each one of the islands. So it's not just Honolulu-centric or Oahu-centric, but the Hawaii Small Business Development Centers have certified export consultants. They're available on all the different islands. And so it's a big advantage to kind of learn about this program and begin to participate, start building the strong foundation to make that launch into a different country, a different market, very, very successful. So early business, get ready for exporting, export university. And then with all of that information, hopefully that will give companies the tools that they need to either put together an export plan if they don't have one, or maybe tweak an export plan that they already have. And then we look at programs that we provide that they might be able to participate in. And so that would be our Hawaii Pavilions at various trade shows in which the cost for participating is subsidized and making it less expensive. Okay, I think we really want to hear a little bit more about the trade shows and how to get involved and what you offer. We're going to have a really quick break here in a minute. But just to let people know, this launch is starting very, very soon. So they should be looking up. I think our first programs are starting. What's the schedule? Okay, so November 4th, we'll be on Maui in Kihei. We'll do our high step kickoff on the 5th. We are doing a Hilo in the morning and Kona in the afternoon. And then on the 6th, we'll be on Kauai. In each of those places, we're partnering with the Small Biz Development Center to put that together. And then on Oahu, we're having our launch on November 19th at the foreign trade zone. So that will give an overview of the program. We'll have our partners there to talk about their roles and their organizations. So they'll get all the details on this. Where could somebody go just before we go to break? Do we give them a website to tell them where to go? Yes, our website is invest.hawaii.gov. And if you go under the Exporting tab, you'll find out everything that you need to know. InvestHawaii.gov export. Okay, we'll be right back with you for more with Jamie Lum from D-Bed and High Step. Thank you. Stay with us. Thanks to our ThinkTech Underwriters and Grand Taurus, the Atherton Family Foundation, Carol Mun Lee and the Friends of ThinkTech, the Center for Microbial Oceanography Research and Education, Collateral Analytics, The Cook Foundation, Dwayne Kurisu, the Hawaii Community Foundation, the Hawaii Council of Associations of Abarbon Owners, Hawaii Energy, the Hawaii Energy Policy Forum, Hawaiian Electric Company, Integrated Security Technologies, Galen Ho of BAE Systems, Kamehameha Schools, MW Group, the Shidler Family Foundation, the Sydney Stern Memorial Trust, VOLO Foundation, Yuriko J. Sugimura. Thanks so much to you all. Thanks for staying with us. We're talking about exporting in Hawaii and what it does for small businesses. I love this time of year because it is the beginning of our new fiscal year. We get to start everything over and we get to launch programs all over again. So we're really happy that we are bringing up High Step for one more year at least. Hopefully this program will continue because it's shown such great results for small businesses in Hawaii. Another reason it's my favorite time of the year is that it's time to nominate small businesses for their accomplishments for the SBA Annual Small Business Awards. This is a great process and I'm looking actively for exporter awards. So small business exporters, those people who sell products and services outside the state of Hawaii, they've shown innovativeness of products and services, finding new ways to get their products to different markets, they've opened up new markets. Maybe they've been involved in the High Step program or worked with some of our SBA resource partners. SBA also has ways to help with funding for exporting programs, so they can learn more about it if they go with your program too, right? That's correct. SBA awards nominations, you can find them online, go to SBA.gov there due November 4th. So just before we do the kickoff for 2020 High Step program. So we were talking earlier about how to get involved, pre-exporting, early export, new market export, but what does somebody have to do to get some of the benefits and get ready to go with you on a trade show? You've got a whole variety of programs. Right. So actually, I should mention, we have a registration form on our website, which is, again, invest.hawaii.gov under the exporting tab. And really what we want is we're looking for information on the company so we can see, you know, what their export experience is, and that kind of gets the ball rolling in terms of once they submit that, and then we can pair them up with one of our resource partners to kind of help them. And getting them to the right connections to start. Exactly. So you want to pre-screen a little bit, see if they're ready, or help them avoid the frustration. See what if they have particular issues. And then we also want to see what they're interested in. You know, are they interested in coming to any of our training sessions? Are they interested in a trade show? Are they interested in company assistance? So we ask those types of questions. So that would be the first step is to make sure that they fill that out, make sure that they qualify. Companies do have to meet SBA's size standards, which most companies in Hawaii do. And then they also have to have their product or their service has to be 51% U.S. content. Okay, 51% U.S. content. Can you give us some examples of products that obviously would be eligible or ones that you have been, had to bump? So some of our Hawaii products are not manufactured in Hawaii. So it depends, there is a formula. So it really depends on how much of the value is added here in Hawaii or if they produce it on the mainland, of course that would, but if they're producing it out of the country then we'd have to look at what the components are and what the, you know. So there is a formula that they use to figure that out. So, you know, some of our apparel companies, for instance, they might be designed here, but not manufactured here. So it would just depend on how much they're spending on their product here. The materials come from somewhere else, you know, carvings come from somewhere else and then are assembled here in a different manner. What number of components that went into that piece and where was the work done? So it's based on the cost of what they're bringing in and then what their cost is for the labor and whatever other components here. But you have people who can help figure that out. Right, if they have questions they could always ask us. So yeah, so there are some, you know, just some requirements making sure that they qualify for the program. But we really haven't had too many companies that we couldn't help. So that, you know, that's, that's good. Great. So, you know, they attend our training sessions and get, and the other thing I wanted to mention is although the training sessions are held on Oahu, although this year we're going to have one on, we're going to do the expert university on Maui because we have a lot of companies on Maui very interested. But we do, people can join via webinar. So even if this island, people that are North Shore or whatever, they can't come into town. So we do webinars and we also video hate them and put it in a video library on our website. People can view them later. There's lots of ways to become involved with this. Right, right. So that's, so that you, yeah, there's, there are a lot of different ways you can get the information we're trying to get out there. To for, for those companies that are interested in trade shows, we put out announcements several months before the trade shows to start recruiting and then they, you know, they would sign up. Again, we're doing everything online in terms of our, our people registering and so forth. But how that works is we will buy a number of booths in a show and we will pay for the cost for putting up that Hawaii Pavilion and we, we, we, we format it such that people know that it's Hawaii, you know, are, we decorate it with, you know, Hawaii images and a big Hawaii sign so that they know. And then you have all that Hawaiian food that smells wonderful and everybody's like, where is that? At the Tokyo show, yes. We don't do that at all of the shows. But then people know that these companies are from Hawaii. And then we do assess a participation fee, but it's usually around about a third of what the company would spend if they went into the trade show directly. Their financial benefits for a small business, both with the marketing impact as well as an advantage and a reduced cost. And we've also found that companies also learn from each other at these shows and have, you know, maybe partnered together on certain things. So it, you know, there are a lot of other benefits too besides just, you know, them finding buyers and whatnot. So that's, yeah, that's another component of our. And I think right now you may have two programs that you're promoting. I think we put two messages or Sandra posted a couple of messages in our new, recent newsletter. Right. So do you want to mention those? Right. So we are, we are actually, I think there might, anyway, we are recruiting for the Surf Expo, which is in January, and, and then a show called FabEx, which this is the first year we're doing it, Department of Agriculture has done it in the past. And we're picking that up this year and it's a food show in Tokyo. It's geared towards more restaurants, you know, to supply restaurants, ingredients and so forth. So that's another show. We do have another, tied to a program we have with the HongQ department store. They have buyers that are coming in on October 29th. So that one is coming up immediately, where some of them are coming here and companies are going to be able to actually show them products. So the HongQ event is something that happens in July. It's a week long consumer show at the HongQ department store in Osaka and again during the week they have over 200,000 consumers that come through and they highlight Hawaii products. So it's a good way for companies to, that maybe are not exporting on a regular basis to Japan, they, they can kind of do market testing, see how consumers respond to their product and see if there's anything they need to tweak. A lot of our companies find they need to repackage into smaller quantities and so forth. Interesting. So that's the kind of things that they learned and then, and then they can go into trade shows where they would have direct contact with buyers and distributors. It makes me kind of chuckle because I look back to a story a couple of years ago that came out of D-bed. One of your success stories, a small business, couple of young guys had started making chips in their kitchen like hungry after surfing and making taro chips in the kitchen and mixing up some hot sauce and Jimmy Chan, you know, Hawaiian chip company does salsa, hot sauce and chips. They become very, very popular and he's really done very, very well. He was a SBA exporter of the years, a couple of years ago but the story came out. He had the opposite problem from downsizing to smaller packaging because he was selling hundreds of thousands of gallons of hot sauce. Right. I know Dennis and I, Dennis Ling and I were laughing about the volume. Do you remember? Well, because Jimmy hit the restaurant, that's where the restaurants wanted to buy from him. That's why the gallon. So his small bottled sauces were later sort of an afterthought directly to consumers but restaurants were buying his sauce to put into their food. So yeah, and his story is interesting also because chips were his first product but he found that it was difficult for something like that because of the shelf life so that's why he's been, as far as the Japan market, turning more to the sauces which have a longer shelf life. And I think that single sale was like 600,000 gallons of Kilauea fire going to Japan, you know. I didn't know if they were bathing in it or resting or what but that was a heck of a lot of sauce. But that's the outcome of this program for some of the small businesses. Right. And again, it's going and trying it and then, well that didn't quite work but we learned this, we learned that, we need to adjust here, adjust there and they've made that adjustment nicely and been able to profit well. So from being hungry after surfing one day, it's grown to this big successful Hawaii company. Exactly. And it's a wonderful story and we continue to watch and work with him and he works with a lot to help a lot of other people like with the Hawaii Food Manufacturers Association and encouraging other people to learn as he has. Right. Yeah, that's another great thing about the program is that a lot of the companies are so willing to share with other companies their experiences and especially, you know, if it's something that, you know, that maybe a misstep here or there and they really want other companies to learn from their mistakes and, you know, things to avoid. So we do a session with the Innovate Hawaii program which, you know, helps manufacturers and they bring in a panel of companies to talk about all of their, you know, what they've gone through in the growing pains of their company. Jimmy has been one of them Hawaii chip company but Manoa Chocolate also has, you know, been there and talked about how they started making chocolate in their UH dorm room. I think it's Hungry Guys, a lot of these start with Hungry Guys, you know, but they're a really very, very interesting business as well and have just expanded to a lovely store in Kailua. Right. Right. From Dylan starting up, Dylan and Tamara Butterbaugh at Manoa Chocolate, they've even started to look at how they become the suppliers and grow Hawaiian pacao to produce their wonderful chocolate internationally recognized for its quality. So they're exporting to Europe and to Japan and you know or work with them on other markets. I think they've been looking at Australia also in Canada but they are one of the companies that have expanded. We have so many companies again because of our ties with Japan and so forth, many of, I would say 90% of the companies that that's their target market but Manoa Chocolate is one of those that has diversified into other markets. So there are so many places a small business can go and because we're just getting ready to wrap up, we want to remind everybody to go online and take a look at these programs. Also, let your mind kind of wander and look at some of the markets that are available. We do look at the South Pacific. We do look at Australia, New Zealand, there's South America. Some of the naturals of course are the brick. They still call them that, you know, the fast growing economies and fast growing consumer economies that will be looking for products and services of all types. But this is a great way to start with the High Step Program. It's hosted here in Hawaii, developed a great program, gets your results, return on investment. So it's good for Hawaii. It's good for your business. So thank you so much for joining us today, Jamie. And again, we're going to be starting this program. Neighbor Island, you want to repeat those dates again? So starting on Maui on November 4th and then Big Island on November 5th, doing Kilo in the morning, Kona in the afternoon. And then on the 6th, Kauai. And then on Oahu November 19th. And that will be at the foreign trade zone in the morning starting at 9 a.m. Yes. OK, so thank you so much for joining us. Please do check out the High Step Program. Think about what you can do to expand your business and your opportunities by exporting outside the United States. Lots of customers, lots of way to help. And nominate your friendly business for an SBA Small Business Award. You can find that information at www.sba.gov.com or HI, excuse me, Hi. So thanks for joining us today for another Adventures in Small Business. We'll see you next time. Aloha.