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EXIM Enables North Dakota Manufacturer to Enter New Markets

Exporter/Customer: 
WCCO Belting, Inc.
Export Destinations: 
More than 20 Countries
EXIM Bank Product: 
Export Credit Insurance

WCCO

Established in 1954, WCCO Belting, Inc. of Wahpeton, North Dakota, manufactures specialized belting products used in the agricultural and industrial industries (e.g., farm machinery such as conveyor, draper, baler, pickup belts, etc.). The business had a humble origin. Ed Shorma, the son of immigrants, expanded the family shoe repair shop into eight separate businesses, one being Wahpeton Canvas Company. This earned him the title of 1982 Small Business Person of the Year. In 2001, his son Thomas (Tom) Shorma became CEO and President of WCCO Belting, Inc. and has led the international expansion of the company.

EXPORT CHALLENGE

Mr. Shorma understood the large market size outside the United States. At the same time, he realized that entering new markets comes with political and commercial risks, especially the possibility of international buyer nonpayment. It is a great concern to any business, especially a small one with a limited cash flow.

The company also knew that international buyers preferred paying on credit and not cash in advance. They had cash flow concerns too and needed time to sell their new inventory or to finance vital equipment.

EXIM SOLUTION

WCCO Belting obtained an EXIM Export Credit Multi-Buyer Insurance policy nearly two decades ago to resolve its two key challenges. Working with its insurance broker Trade Acceptance Group, the company has used the policy to protect against nonpayment and entered new markets with confidence as the insurance covered up to 95 percent of its sales invoice. With this assurance, WCCO was confident in extending open account credit terms to their current customer and new buyers.

RESULTS

The company now has 200 employees and distributes to more than 20 countries with South America and Australia being its largest markets. Furthermore, more than half of its total sales are derived from exports. CEO and President Shorma clearly expressed how WCCO has grown, “This small family-owned business has grown from a company that was basically selling into Canada, into one that sells into more than 20 countries. One of exporters’ biggest concerns is collecting for what they ship, and that's what the Export-Import Bank does really well -- it guarantees payment.” Since 2014, EXIM has supported more than $1.2 million of the company’s international sales.

“There is only one thing worse than not getting an order... and that is getting the order, shipping it, and not getting paid. Then you’re out for the cash and inventory. The U.S. EXIM Bank ensures a company gets paid for the products it sells, supporting its ability to compete worldwide.”
Thomas (Tom) Shorma, CEO and President