When the bottom line seems stagnant or you’re seeing very few up-ticks, think about Israel as an additional market. Economists, resource agencies and companies who do business in Israel say the economy there is growing and the country is a good trading partner.
Midwest company exports to Israel
“I absolutely recommend looking to Israel for almost any company reaching abroad,” says Peter Carlson of Minneapolis-based AgMotion. Carlson is in charge of the company’s organic specialty grains division, which processes the grains purchased from farmers and sends them to overseas customers, including businesses in Israel. “They are good international traders,” he says, explaining that customers in Israel will guide their US business connections through the process so they comply with Israeli customs.
“International business is not extremely difficult, but a mistake could be extremely costly. It’s OK as long as one does the proper research,” Carlson said. He also recommends attending trade shows to find overseas customers.
The America-Israel Chamber of Commerce (AICC) Chicago Connects Businesses
The AICC, a not-for-profit trade association founded in 1958, develops business relationships between U.S. and Israeli companies. It connects members ranging from wholesalers and retailers to manufacturers and distributors with venture capitalists, investment bankers and service providers. The organization is a good place to start for help in locating customers and learning how to export.
According to AICC Chicago Executive Director Michael Schmitt, the volume of trade from the US to Israel is increasing. His office received 145 Certificate of Export requests between January and June 2011 compared to 84 requests in the same period in 2010. Of those requests for certificates, 32 came from different companies in 2010 and 52 from different companies in 2011.
AgMotion is among the companies who have requested a Certificate of Export. The export certificate, which documents country of origin, is needed to move exports from other countries smoothly through Israeli customs.
“The volume has picked up. They have been exporting here, but the export market between the US and Israel has been under the radar. Companies here don’t always think of Israel when exploring new markets,” Schmitt says.
Illinois Governor Pat Quinn (center) tours the Kinneret with the lead Israeli scientists working there. PHOTO CREDIT: Alon Grego / JUF News
His office is also familiar with the United States-Israel Free Trade Agreement, so he helps companies both import and export. Established in 1985, the agreement lowers some barriers in trading specific products. “We help them work through the process,” he says.
Indeed, shipping companies often suggest businesses call AICC for aid with exporting to Israel.
“I just received a request for help from a company in Ohio that manufactures orthopedic implants,” says Schmitt. He explains that the US business will be exporting to a particular company in Israel, so they already have a customer; they just need help with documentation procedures.
“The company was recommended to us by UPS. When a company calls UPS with export to Israel issues and questions, UPS will often recommend they call us,” he said.
Israeli trade connections have also benefited US companies who find the country’s products are a good mix with their own.
Local company imports from Israel
North Suburban plant grower Shlomo Danieli has a farm in Beloit, Wisc., but also imports from Israel, Thailand, Chile and Columbia to supply his retail customers with flowers and greenery for every season.
He added his Israeli Herb division in 2009 to provide customers superior products year-round. His Alon Ha’Galil division arranges for fresh flowers and greens to be directly shipped from Israeli growers to his US customers.
Danieli, who grew up in Israel, already had contacts there. So when the time was right, both from the standpoint of importing from Israel, and when his own plant business was ready to import, he was familiar with Israel products and sources.
“The flowers from Israel are top in the world in quality,” says Danieli.
He agreed to sit on AICC Chicago’s board two years ago to help other businesses work through import and export procedures. “They wanted people who have Israeli contacts,” he says.
AICC works bilaterally
Suggesting contacts, but also arranging events to meet potential customers and gather information, is also part of AICC Chicago’s task, according to its president Dan Shure.
“We encourage businesses to look to Israel,” says Shure. “Our entire mission is bilateral trade. We work in both directions. Not only do we help Israel business sell to Chicago, but as the America-Israel Chamber, we help companies here sell their products in Israel,” he says.
“Companies range from pharmaceuticals and technology partnerships to baby products. No matter what you do, we’re here to serve you,” says Shure.
Among the ways AAIC assists US companies is to sponsor programs every few months that tie into visiting trade and economic ministers from Israel and trade shows in Chicago.
“We did that for the Restaurant Show and will do it for Radiology Show in November,” he says. “Companies here and in Israel shop for partners. We help businesses find good partners.”
Networking and seeking venture capital
Finding a good partner and obtaining expert advice is very important, according to Kellogg School of Management Professor Lloyd Shefsky. The Clinical Professor of Managerial Economics and Decision Sciences, Shefsky teaches “Successful Entrepreneurship.”
A believer in networking, Shefsky recommends setting up initial informal meetings with contacts in Israel that will eventually lead to a working relationship.
“Someone knows someone who knows someone else. It’s seven degrees of separation,” he says. He particularly advises that businesses here become familiar with how things are done there. “It’s a guild society. Meet with the associations. Know the culture.” He adds, “Getting the right partner is critical.”
Another option Shefsky recommends is working with venture capital companies in Israel. “There are over 2,100 venture capital companies there with portfolios of companies to partner.” He also suggests says that finding a partner in Israel means not having to open an office there.
Among agencies that offer capital is Bi-national Research and Development, known as BIRD. “They provide venture capital grants from both countries. BIRD helps fund the endeavor.”
Shefsky explains: “Say you have a marketing company here and they have a tech company there, BIRD can help put the joint venture together. You get everything you would if you opened an office there, only better. It can be very valuable.”
State of Illinois trade offices offer assistance
Another place to go for help is Illinois’ trade office in the Thompson Building, downtown Chicago. The State of Illinois has trade offices throughout the world, including Israel.
“We are matchmakers. We introduce companies in Illinois to companies here in Israel,” says Sherwin Pomerantz, director of the Illinois Office of Trade & Investment’s Eastern Mediterranean Regional Office. Pomerantz works out of the Illinois office in Jerusalem, but is frequently at the Chicago office.
He points out that his office is used to assisting small and mid-sized businesses. As an example, his office worked with Decatur, Ill.-based Lincoln Diagnostics, a mid-sized allergy skin testing company that distributes globally and is now adding Israel to its list.
“An Abbott or a Kraft doesn’t need our assistance,” he says of two Illinois companies with an extensive global reach.
Pomerantz definitely advocates looking to Israel to do business. “It has one of the best economies in the world.”
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Jodie Jacobs is a Chicago journalist who has contributed to the Chicago Tribune for more than 20 years. Her articles have also appeared in Crain’s Chicago Business, Lake County Business Journal and What’s Happening. Jodie_jacobs@sbcglobal.net
Resources:
America-Israel Chamber of Commerce, 500 Lake Cook Road, Deerfield, IL 60015, Suite 350, 847-597-7070 http://www.americaisrael.org/
Illinois Office of Trade & Investment, Department of Commerce and Economic Opportunity, James Thompson Center 100 W. Randolph St., Chicago, IL, 312-814-2828 www.commerce.state.il.us/dceo/Bureaus/Trade/ and Eastern Mediterranean Regional Office in Jerusalem 972-2-571-0199 www.atid-edi.com
Federation of Israeli Chambers of Commerce (FICC), Tel Aviv, 972-3-563-1020 www.chamber.org.il/content.aspx?code=7129&cat=0
About Jodie Jacobs
I am looking to work for an American company that does work in Israel.
I became an Israeli citizen in 2004 by Aliyah and have my own consulting firm in California. I would like to live in Israel, but visit California frequently on business. Can you suggest a list of companies where I might fit? I am a hydrogeolocal engineer that does his own marketing and sales and staff training and management.
Frank Goldman
Thanks, Frankin! We will be on the lookout for resources on your behalf.