International Sales Increase For Firms During Downturn

International sales have grown in the past few years at Valley-area manufacturing companies as firms try to expand their markets. Foreign-based sales make up between 50 percent and 70 percent of total sales at aircraft parts maker Aero Engineering & Manufacturing Co. in Valencia, and 54 percent to 60 percent at aerospace structural components maker Frazier Aviation Inc. in San Fernando. Matthews Studio Equipment Inc., a Burbank-based manufacturer of hardware and lighting control devices for the entertainment industry, has international sales that represent only about 42 percent of total sales. However, it does business with more than 70 countries and has received recognition for global presence. The company was named “Exporter of the Year” by the U.S. Department of Commerce’s publication “Commercial Business” in 2008. It also received “The President’s Award for Excellence in Export” in May 2010, which was limited to 17 companies nationwide. At Sylmar-based Anthony International, international sales make up 15 percent of total sales. The company ships its commercial glass refrigerator and freezer doors and specialty glass to more than 75 countries. International growth Representatives from the companies say more businesses in the manufacturing industry are starting to ramp up their global efforts in order to remain competitive. “It’s just kind of where the market was going,” said Dennis Junker, president of Aero Engineering & Manufacturing Co. which has seen its global sales grow mainly over the past 10 years. “There was an opportunity there and we had the ability to do it.” The company deals with foreign governments that have purchased U.S.-built aircraft, as well as with foreign companies. The company also makes parts for fire bombers, or planes in the U.S. that put out forest fires. Junker said dealing internationally has given his company more production capacity. “In manufacturing these days, quantity is a big factor,” he said. “Our international sales coupled with domestic sales allow us to reduce our unit costs and be more competitive.” Others say the practice provides a safety net for when the United States’ economy is struggling. Marcia Cooper, sales manager for Frazier Aviation said her company grew in recent years while many others were hard-hit by the recession. She estimated the company’s international sales have grown by about 20 percent over the past three to four years, particularly through outreach efforts such as attending trade shows. “You have to diversify because you can’t put all your eggs in one basket, especially with the United States,” she said. Government compliance Being a global manufacturing company, especially in the field of aerospace, means keeping up with current policies and foreign affairs, Cooper said “Right now we have to be really careful because there are quite a few countries that have embargoes assigned to them from the State Department,” she said, giving Libya as an example. “We have to be very cautious about who we do sell to.” Cooper also said many aerospace manufacturing companies now have more restrictions under the expanded role of the government’s International Traffic in Arms Regulations, which control export and import defense-related products. “They’re scrutinizing every single part that leaves this country to make sure it’s going to the right country,” she said. Frazier Aviation has formed an export compliance department in recent years to help the company stay in line with the tighter regulations. Cooper said companies looking to expand into international sales should do several things. They should make sure the countries they are selling to are reputable, look into whether the companies actually have money, and try work with agents in the foreign countries who can help keep track of activity on the other end of the deal. Linda Swope, sales manager for Matthews Studio Equipment, said the key is also in outreach. “I think you’ve got to start by doing trade shows in your area of expertise,” Swope said. “You really do that to get to meet people that are in your industry, end users, (and) you get to meet producers.” Members of Matthews Studio Equipment’s sales team go to trade shows in countries such as The Netherlands, the UK, Mexico and China. The company’s international sales went from representing about 20 percent of its total sales to more than half over the past seven or eight years, Swope said. Matthews Studio Equipment is currently focused on gaining more business in Latin America, which is being considered a “hot spot” for business this year.