In 2012, China passed another impressive benchmark – it became the largest importer of food and beverage products in the world surpassing the US market. That’s good news for US food companies and the US balance of trade, and it’s also good news for many US export companies. Often overlooked in such statistics is the key role that US export brokers play as the middleman in navigating and linking US food producers to the Asian appetite for safe, high-quality, US-made food products.
One such trader is CAS InterGlobal, LLC, a small startup business based in Pleasanton, California, led by Sammie Xiao. Xiao had witnessed the growing demand for US food products while working for a major US trading company and handling Asian accounts for nearly a decade. In 2013, she pulled together a team, invested some capital, and started her own trading operation, signing up a network of US food makers to begin selling everything from cookies, chips, and cereal to bottled water and dried fruit to large Chinese buyers such as Walmart China, Amazon China and COFCO (the largest Chinese food company). In addition, Xiao’s company now represents a series of California agricultural growers and helps them achieve new export sales.
Yet selling internationally can bring challenges. The lag time between buying goods, shipping them, and finally receiving payment can create a cash flow problem for companies like CAS InterGlobal. Since payment depends on foreign buyers, financing export transactions is sometimes perceived as more risky. Thus, a standard working capital credit line may not be available.
That’s where East West Bank and the U.S. Small Business Administration (SBA) came into the picture. Working together using SBA’s Export Express Program, East West Bank began providing a line of credit to CAS InterGlobal earlier this year. After nearly a year of relying solely on self-financing, the increased working capital allowed the company to expand operations.
“The SBA program helped our bank – which has both international banking and SBA expertise – set up a loan that was just what CAS InterGlobal needed,” said East West Bank’s Annie Xu.
The added working capital increased the company’s ability to make sales, and put the company on track to achieve an export sales level three times what it was a year earlier. The company is expanding quickly to new markets such as the Middle East. The East West Bank loan “helped us get to the next level,” said Xiao.
SBA is eager to support US exporters who are entering or building their international business. “Exporting is an opportunity for small businesses as well as large ones,” said Jeff Deiss, SBA’s Regional Export Manager. “SBA has loan guarantees designed to make it easier for small exporters to get the financing they need.”
To learn more, visit www.sba.gov/international.