Funding and Cost Concerns for Trade-Impacted Manufacturers
Many manufacturers hesitate to hire experts because of cost. How does MATAAC’s funding model remove that barrier?
When a firm is negatively impacted by foreign trade, are losing market share, and finding themselves losing sales and profits, they usually move into a position of cutting costs rather than looking to hire outside help.
The benefits of the TAAF Program is that it is a federal funded cost-share program. Therefore, it pays a portion of the identified and approved projects required for recovery. Thus, removing some of the major financial concerns of implementing consultant based projects in a recovery plan.
What kind of ROI do manufacturers typically see from these expert-led projects?
Return on Investments (ROI) depends upon the projects being implemented. ROI is an important part of recovery and the future success of a company and receives significant consideration during the development of a client-firm’s recovery plan.
Projects must be intangible in nature. While training employees in your warehouse to drive forklifts would be an acceptable project, it doesn’t provide a return on investment performance metric necessary for business recovery and growth.
Projects such as website development with a quote feature or e-Commerce, would bring a much larger return on investment and help with a client-firm’s future success, as an example.
Projects are selected based upon the unique needs of each individualized client-firm. Therefore, their ROI will be based upon those projects implemented and tailored to their needs.
How does the federal cost-sharing structure work in a way that makes expert help truly accessible?
Federal cost-sharing through the TAAF program is based upon the total recovery plan costs.
For a total request of $30,000 or less, cost-share is completed on a 75% MATAAC federal cost-share of project implementation where MATAAC will cover $22,500 in project costs. A firm receives the benefits of $30,000 in projects implemented for only a firm share of $7,500.
For a total request of $150,000, cost-share is completed on a 50% MATAAC federal cost-share of project implementation where MATAAC will cover $75,000 in project costs. A firm receives the benefits of $150,000 in projects implemented for only a firm share of $75,000.
What do you say to a manufacturer who feels like, “No one understands my business like I do”?
I agree 100% with them.
No one does understand their business the way they do and that is why they are always a significant part of the business recovery process and plan implementation. They are in full control of what consultants they would like to hire and are always the final decision and approval. After all, it is their business and there isn’t anyone who knows it or understands it better than they do.
How do you build trust with firms that are skeptical of outside consultants?
At MATAAC, we allow our client-firms to pick the outside consultants they want to hire on the projects required for recovery. Usually, they already have working and trusted relationships with those consultants.
Client-firms that start in the TAAF program, skeptical of outside consultants, usually see the benefits of hiring these experts during the development of their recovery plan. No projects are added to their recovery plan without full communication and involvement of the leadership team. Trust of outside consultants is usually authentically and organically grown throughout the TAAF program phases.
What changes do you see in leadership and culture once they start working with expert teams?
The pressure is off.
Experts are handling the details of the recovery plan projects and implementation. Business is in recovery mode and leadership can get back to their own areas of expertise – running the business.
How fast do manufacturers typically start seeing results after working with outside experts?
The speed of seeing results after working with outside experts usually depends upon the projects and the project implementation timelines.
At MATAAC, firms have a total of 5 years to fully implement their business recovery plan. For performance metrics, MATAAC tracks improvements during the 5 years of project implementation and for 2 years after program completion.
Typically though, as soon as business recovery project implementation begins, manufacturers usually see improvements.
What’s one of your favorite transformation stories where expert help led to a big breakthrough?
Every transformation made with the TAAF program is created with the assistance of outside consultants and experts. That is the beauty of theTAAF program. It’s a cost-shared program that allows the trade impacted manufacturer to implement business recovery assistance projects with the assistance of industry experts, while cost-sharing on those projects.
My personal favorites are when a manufacturer creates an e-Commerce site. These projects help a firm compete in a global market place and always benefit from ROI (Return on Investment).
How do you help companies not just recover—but come back stronger and more competitive than before?
During the Business Recovery Plan Phase (or EDA’s Adjustment Proposal Phase), MATAAC works with company leadership to create a plan specific to the company’s unique needs that assist in growing sales, operating profits, market share and U.S. jobs. Their recovery and future success is what the TAAF program is all about.
What’s one thing you wish every struggling manufacturer knew about the power of outside expertise?
That we are always better, together.
When we bring together a team of experts, we elevate the team and the projects exponentially. Everyone brings their own unique strengths to the projects and that always is a positive benefit to the manufacturer.
What sets apart the manufacturers who fully embrace the recovery process and thrive afterward?
Increase sales, market share, profitability, a new direction and strategy, a global competitive plan and a potential to increase employment.
In a word, Growth.
Growth with a potential to become an industry leader.
How MATAAC Serves Mid-Atlantic Manufacturers
For over five decades, MATAAC (MidAtlantic Trade Adjustment Assistance Center) has been helping turnaround manufacturers by tackling trade challenges, regain competitiveness, and boost profitability. MATAAC provides solutions to manufacturers located in Delaware, Maryland, Pennsylvania, Virginia, West Virginia, and Washington D.C. MATAAC has been chartered by the Economic Development Administration of the U.S. Department of Commerce with responsibility for the management of Trade Adjustment Assistance for Firms (TAAF) program. The TAAF program is a crucial resource that supports businesses in navigating global market shifts.