Export Barriers for U.S. Small Businesses!
By Joseph Knilans, Rural Affairs Advocate
What do fireplace firebricks and industrial flooring have in common? Allied Mineral Products. On March 26, the Advocacy team visited Allied Mineral Products in Columbus, Ohio and met with John Halsted, Executive Vice President of International and Affiliated Companies. Allied produces monolithic refractory products. They were founded in 1961 by William F. Winemiller and Robert M. Scott in the Columbus area. Allied Mineral has 800 employees and 12 manufacturing plants worldwide. They have expanded over the last 25 years acquiring five other facilities within the United States.
A refractory process consists of using non-metallic material that has the ability to retain its physical shape and chemical identity when subjected to high temperatures. This process produces non-metallic products such as fireplace bricks, blast furnaces, ladles, and transfer vessels for molten steels and aluminum that produce many of the steel products that we use each day. The non-metallic products are formed in a pre-cast shape by combining materials having chemical and physical properties that make them applicable for environments above 1,000 degrees. These materials consist of a few chemicals, such as oxide and binary compounds combined, to make these products.
Allied makes products for many Fortune 500 companies such as General Motors, Caterpillar, Alcoa, and Ryobi to mention a few. Working with these companies demands a worldwide presence. Their headquarters is located in Ohio, and they have additional locations in Washington, Alabama, and Texas. They also have facilities in Chile, Brazil, The Netherlands, South Africa, India, and China.
Allied is an employee stock ownership plan (ESOP) company. This gives them the ability to be financially sound and debt-free. Being an ESOP also allows them to focus on their greatest asset, their employees. However, they are struggling with barriers that can negatively affect their company. Some of these barriers are trade related and some are federal regulations. Here are a few barriers that have impacted Allied:
- Over the road container weights 19.5 Vs 24 MTs.
- It does not allow them to move their product to the end consumer due to lack of infrastructure upgrades.
- OFAC Sanctions specific to the US (Russia, Ukraine, Iran, N. Korea)
- They located a plant in Russia that allows them to manufacture and sell to Russia.
- European REACH program (Registration, Evaluation, Authorization, and Restriction of Chemicals)
- The REACH program makes it difficult to use chemicals that may be approved to use in the United States but not approved in the European Union. This forces Allied Mineral to source chemicals in the European Union in order to manufacture and sell in the European Union.
- Foreign currency risk
- Payment risk
- Investment costs in managing international business (travel, dedicated experienced people, managing AR)
One other concern Mr. Halsted mentioned was the inability to find and hire qualified employees. One reason for this was a lack of workforce training. He also mentioned that soft skills, such as showing up to work on time, being drug free, and finding employees willing to learn the job, were some of the difficulties they faced. Although Allied Mineral Products has expanded over the last decade, their expansion could be greater if federal regulations weren’t barriers for their investment.
Advocacy was in Columbus, Ohio for a Small Business Outreach Meeting on Trade Agreements with Japan, the European Union, and the United Kingdom March 26.
If you were unable to attend this event but would like to provide your feedback to the Office of Advocacy, please email your name, company, industry, and business size (number of employees) to AdvoTradeFeedback@sba.gov.
Joe Knilans serves as the Rural Affairs Advocate for the SBA Office of Advocacy, representing small businesses in rural America. Knilans works with small business owners, state and local governments, and small business associations to bring the voice of rural America to Washington DC. He can be reached at Joseph.Knilans@sba.gov.