Export office sees big return on investment

2011-09-23T10:01:00Z 2011-09-23T10:11:55Z Export office sees big return on investmentBy DALE HILDEBRANT Farm & Ranch Guide Farm and Ranch Guide
September 23, 2011 10:01 am  • 

(Editor's note: This third and final article in the series will look at the success record of the food export activity of the North Dakota Department of Agriculture and see how companies that have used the service score the program.)

As mentioned in previous articles, 27 companies participated in the Food Export-Midwest program in 2010, according to Stephanie Sinner, marketing specialist with the NDDA. This involvement was spread out over 60 programs and generated sales of over $12.7 million. Those increased sales helped the companies  involved add a total of 13 new employees.

However, new ag export sales also come about through the partnership of Sinner's office plus the North Dakota Trade Office and federal agencies involved in food and ag export matters such as USDA's Market Access Program (MAP).

The MAP funds are part of a cost-sharing program that uses funds approved by Congress that help create and maintain export markets. According to Sinner, MAP is currently authorized to spend $200 million annually.

Positive return on investment

In these times of tight budgets, there is a good possibility that some government funding will be based on the return realized on the tax dollars invested. Figures supplied by Sinner's office indicate the return on investment for ag export funds is quite favorable.

For instance, for every dollar that was invested from the MAP funds in North Dakota $47 was returned. And the results are even better for the state dollars invested in the Food Export-Midwest program where each dollar contributed saw an $1800 return.

"You can't argue with numbers like that on return on investment,"she said. "It speaks volumes on how the state's membership in Food Export-USA has worked."

Ratings look good as well

As important as the return on investment numbers are, Sinner is also concerned on how participants in the export program feel about the work she is doing to expand those markets.

After each event, participants are asked to fill out a survey and rank their satisfaction on a variety of activities that are part of an event. Last year North  Dakota companies gave the following average ratings based on a scale of one to five, with five being a top score:

Pre-event planning/communication - 4.35; Program execution - 4.58; Fulfillment of needs - 4.36; Cost/benefit returns - 4.50; Quality of contacts or info - 4.46; Increased knowledge about exporting - 4.36; Food Export performance - 4.47; and Overall average rating - 4.43.

Programs that were rated in these surveys included the Food Export Helpline, focused trade missions and various food shows held around the world.

What the future holds

The export demand for North Dakota's ag products is sure to increase over the next few years, according to Sinner. In an effort to stay on top of the increasing work load, several years ago NDDA's head of business development, Chuck Fleming, was successful in asking Food Export to start an internship program.

"Most of the member states, including North Dakota, now use this program,"Sinner said. "Food Export uses federal funds to pay the intern's salary, but each state ag department is responsible for housing the intern and overseeing their work."

This year's intern in North Dakota is Britt Aasmundstad and she works in the office with Sinner doing such tasks as researching export leads, putting together the newsletter and helping line up activities. Those activities will continue to grow as the export market develops and more growers express an interest in exporting.

"It's definitely our hope that we will see more and more people take part in the export market,"Sinner said. "Many times a business will start out taking part in our 'Pride of Dakota' program and then we try to stair-step them  and help them expand into maybe more sales domestically and then we will transition them into learning about exports and helping them that way.

"If a company is not ready to export, we don't want them exporting, because it's hard and can be difficult, since it takes time and a huge commitment."

But she is quick to note that moving into the export market can be very rewarding, since the it continues to grow at a constant pace. These rewards take the form of higher prices received for the commodities grown by the farmer. The entire state also benefits from the growth in export markets.

"It's job creation and keeping people on the farm,"she said. "The development of export markets definitely helps everybody."

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