On January 1, 2020, the U.S.-Japan Trade Agreement and U.S.-Japan Digital Trade Agreement went into force lowering or eliminating tariffs on $7.2 billion in U.S. food and agricultural exports. U.S. small businesses are encouraged to work with SBA’s Office of International Trade and SBA Resource Partners to take advantage of reduced costs to export and new market access.
The new trade agreements provide even more sales opportunities for small businesses working with Small Business Development Center (SBDC) Resource Partners like Vern Jenkins of Eastern Washington Export Center and Allan Peterson of Moses Lake in Washington State. Over the last three years, Washington State small businesses have traveled with these National Association of Small Business International Trade Educators (NASBITE) award-winning SBA Resource Partners to meet pre-identified customers in Japan, China, Hong Kong, and South Korea.
Right now, Jenkins and Peterson are busy planning another outbound small business mission to Japan in 2020 with a focus on valued-added agricultural businesses. The new U.S.-Japan Trade Agreement decreases export costs for local products including wines, ciders, beef, fresh cherries and frozen potatoes; totally eliminated duties on sweet corn, almonds, blueberries, food supplements; and created country specific quotas for wheat and wheat products.
In Japan, Jenkins found that value-added agriculture and U.S. Department of Agriculture (USDA) certifications from the United States are highly regarded. Small business clients with special, unique, and organic products have gained good traction and often run out of inventory on the Washington State outbound missions. These SBA Resource Partners have also worked with the USDA to tour high-end and upper-end retailers in Japan to become familiar with popular packaging, portion sizes, and labeling. Participants also learn about demands from restaurant chains and established distributors and come prepared to know how to talk intelligently about their planned shipments and give quotes following SBDC trainings.
Jenkins shared that the “biggest take away” for past participants has been discovering that exporting is “not as difficult once they start”. Jenkins finds once small businesses know how it works, the SBA clients are “off to visit potential buyers in other countries” after capturing their export plans with their new global visions. The new trade agreements with Japan are an opportunity to write or refresh business plans and explore overseas expansion with State Trade Expansion Program (STEP) grants.
Resources for Prospective Exporters
SBA has resources to help you expand into Japan. If your state participates in the federal State Trade Expansion Program, then you can reach out to your local STEP office for help entering the Japan marketplace. Additionally, the SBA’s Office of International Trade offers a toll-free trade hotline at 1-855-722-4877 which can answer questions about the new U.S.-Japan Trade Agreement and U.S.-Japan Digital Trade Agreement. You can also receive assistance at U.S. Export Assistance Centers or one of SBA’s SBDCs. Start exploring the many benefits of exporting with the SBA today!