By: Micki Vandeloo, President, Lakeview Consulting
If you are interested in exporting to diversify your markets and your revenues, there is an unknown source of state funding that you should look into – State Trade Expansion Grants (STEP) or export grants.
What are STEP/Export Grants?
The Small Business Administration (SBA) offers a funding opportunity to states on a bi-annual basis through the STEP Funding Opportunity to encourage exporting for companies within those states. State agencies can apply for funding for a 2-year cycle. Each state can propose their own approach to meeting the SBA outcomes which include 100% utilization of the award; increased numbers of companies who export; increasing the value of exports; and an increase in the number of eligible small businesses exploring significant new trade opportunities. This allowance for a state to customize its approach means that programs vary from state to state. In the past funding round, there were awards to 49 state agencies.
Who Can Apply for Export Grants?
According to the latest Funding Opportunity Announcement (FOA), any eligible small business concern located in a state with a STEP funded program can apply to receive export grants. The requirements of an eligible small business concern are:
- A business organized or incorporated in the US
- A business operating in the US
- For manufacturers, employment of 500 to 1,500 employees (depending on specific NAICS code, look yours up in section 121.201 of this document)
- A business that has been in business for over a year
- A business that has sufficient resources to bear the costs associated with trade, including the costs of packing, shipping, freight forwarding and custom brokers
When Can You Apply for Export Grant Funding?
States take submissions throughout the year for these grants, but be aware that many states have a July to June fiscal year, and the term of the grant is 2 years with the last awards given in 2022. Therefore, if you want to seek funding for upcoming export activities, it is better to apply in 2023 as funding may be short in 2024.
Also, many states request that applications be submitted anywhere from 2 weeks to 2 months prior to proposed travel or activity. This allows them time to do their review and ask any questions.
What Export Activities are Covered by these Grants and How Much Will They Fund?
Again, each state offers their own version of STEP/Export funding, but here are some typical activities funded by these grants:
- Airfare, ground transportation, baggage and parking fees to travel to overseas trade shows or participate in trade missions
- Meals and lodging associated with this travel (based on State Department per diem rates)
- Trade show registration fees and charges for booth space
- Trade mission fees
- Fees for shipping sample products
- Cost of compliance testing an existing product for entry into an export market
- Export research tool subscriptions for market research or for SBA programs such as the Gold Key Service offered by the International Trade Administration to help companies find and vet international partners.
- Website and marketing material design and translation
There are usually set amounts that states will fund for each of the above services and applicants can apply for funding for more than one service in an application. The usual total grant is capped at around $15,000 but again, this varies by state. There is also usually a portion of the project that the applicant must pay for, called cost match.
In summary, if you are considering expanding into new markets and plan to attend trade missions or international trade shows this year or early next year, you should contact the STEP program in your state! It is a great, but unknown, source of support for many trade activities!
To gain easy access to the exporting (and other) funding opportunities in your state, subscribe today to the Manufacturing Grant Database! For one low monthly price, you get access to federal and state sources of funding for your company, including STEP/Export grants, updated monthly!
