CASE STUDY: ProStuff LLC

THE COMPANY

ProStuff LLC was founded in 2004 by Pierce Barker and a couple of his friends. As Barker tells the story of the business idea and how it germinated in Columbus, Ohio, it was “our inspiration meeting the opportunity.”

Says Barker, “A customer came walking through the door one day and needed help with a piece of equipment that he had built, and from that we saw the opportunity to take this product—a starting gate for bicycle racing—on an international basis.” Barker’s expertise is in hydraulics, skills he learned from his dad. The starting gate is a pretty sophisticated piece of gear. Add pumps to fabricated sheet metal and some other devices, and the race is on.

The gate is especially popular with BMX, or bicycle motocross. BMX uses a small course of about 400 meters that includes jumps and tabletops.

THE CHALENGE

Barker recognized early that the market in the United States wasn’t as big as he thought. The company had to go global—fast. The biggest challenge for ProStuff was to generate international sales quickly and to produce a high-quality product. Small startup manufacturing companies (ProStuff has six employees) can’t afford the cost of shipping equipment over great distances for repair. To be successful, ProStuff needed from the start to take a durable, reliable product to the world. But customers were not individual bikers; they were organizations that sponsor the races. Where were these organizations, and would they buy?

THE SOLUTION

Barker did his research and estimated that worldwide several million people are involved in the sport of BMX. If mountain biking is added, the market is much bigger. Contacting the individual riders was out of the question, so Barker decided to get ProStuff’s starting gate adopted as the industry standard: “We found that BMX was going to be part of the 2008 Olympics, and I said, ‘The best way to advertise our products is to go to the very top of the sport and work with those guys—become the international specification and let that filter down.’ And that’s exactly what we did.”

Barker picked up the phone and called the Union Cycliste Internationale in Switzerland. He asked the person who answered, “Who do we talk to get our products specified and used in the Olympics?” The person in Switzerland replied, “That would be me.” Says Barker about the call, “That’s how it started.”

Brand building at the Olympics was huge but insufficient to generate enough orders or to provide the financing needed to fill them. “I had no idea what to do when we first started,” Barker says. “We were plowing new ground every day.” Then he found Pat Hope, a commercial specialist at the U.S. Commercial Service. One of the first things Hope did was to introduce ProStuff to the Export-Import

Bank of the United States. ProStuff applied and was accepted into the bank’s loan guarantee program, which provides working capital to U.S. exporters at competitive rates. “With the bank’s assistance and Pat’s guidance, you can’t stop us,” Barker says. “We can go anywhere.”

And they have. Since 2005, when ProStuff made its first export, the company has set up distribution on five continents and has sold products to customers in 41 countries.

“Just in the past 10 hours, I’ve been in contact with China, Latvia, Switzerland, Denmark, and Singapore,” Barker says. “We actually received a contract from China this morning, and it’s our contract. It’s not their contract. They signed ours.”

LESSONS LEARNED

First, Barker explains, you need an export plan, but make it short. ProStuff’s is one page. It says, “Go do this.”

Second, Barker claims, is incorporating the concept of “velocity” in your business. By this he means providing instantaneous response to customers’ needs and requests. He says that it’s not uncommon for him to get a phone call from a customer, and his team turns the request into a shipped order in less than 12 hours.

Third is a conscious business decision to produce the very best product in the world. Barker says that because of this unstinting focus on quality, ProStuff’s business reputation over the past several years has become very strong.

Another lesson is to get out into world and not overlook any market. Barker clearly loves the sport and the young people who pursue it. You’ll find him at tournaments giving advice, cheering on competitors, and, in what seems almost like an afterthought, promoting his company’s products. He has found business in such unlikely places as Bolivia and Zimbabwe. “The political situations are really, really difficult [there],” Barker acknowledges. “[But] we have established successful distribution in both those countries. And where we couldn’t get support because of political restrictions, we said, ‘You know what? We’re going to figure out how to make it work.’ And we’ve done it!”

Related to this is Barker’s injunction not to be fearful. Recently, in South Africa, he was invited to meet a sports group. He was hesitant because of the political situation at the time but went anyway and got a lesson on what “fearless champions of freedom” many South Africans are. “If you don’t go there and see for yourself, you’ll never know.”

Barker believes that a lot of products and manufactured items in the United States need to be taken to the world market in part because of the necessity of creating jobs here: “We’re really good at technology, but we haven’t been good at purveying it. And, philosophically, we have to take that technology to the rest of the world. And that’s been one of the core principles in our success.”

ACTION

How can you start exporting to the world?

  • Get an export plan. There are many good templates for creating simple, useful export plans. In particular, see Chapter 2, “Developing an Export Strategy.”
  • Contact your local Export Assistance Center. See Appendix B, or call (800) USA-TRADE (800-872-8723).
  • Improve your manufacturing processes. For advice and assistance, contact the National Manufacturing Partnership at (301) 975-5020, or visit http://www.mfg.nist.gov.
  • Learn about export financing. A place to start is Chapter 15, “Financing Export Transactions.”rld

“We have to take [our] technology to the rest of the world.