Bank Helps Pump Manufacturer Keep Up with Foreign Competition

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Price Pump, a small manufacturing company in California, was initially established in 1932 to cater to a niche market as a manufacturer of agricultural pumps. Over time the company grew and so did its innovative vision, shifting from agricultural to industrial and special purpose pumps. From cooling lasers for medical use to purifying water through reverse osmosis, today the pumps are valued by a variety of different industries for use in several different ways, in the U.S. and abroad.

Price Pump’s annual sales now hover between nine and $10 million each year, and foreign business accounts for about 10 percent of those sales. Bob Piazza and Karl Buder, Price Pump’s President and CFO, estimate that 25 percent of foreign sales wouldn’t be possible, and at least two jobs would not exist, without support from the Export-Import Bank.

While some companies rely on Ex-Im for financing credit to help foreign buyers purchase U.S. goods, Price Pump primarily depends on the Bank for export-credit insurance. The insurance reduces nonpayment risk enough to give the small manufacturer the confidence to sell its product overseas and expand to new markets. Since Price Pump began its relationship with Ex-Im Bank 12 years ago, the company has expanded its exports into Europe, South America, Southeast Asia and Africa.

Just under a million dollars of Price Pump’s sales are overseas, but foreign competition is growing increasingly stiff. “There will always be manufacturers making products similar to Price Pump’s located in countries that don’t have the strict government constraints that U.S. manufacturers do,” explains Piazza. “The Ex-Im Bank is one of the only tools helping to level the playing field for American companies competing abroad.”

Piazza and Buder also make it clear that Ex-Im Bank is not a handout to Price Pump. The company pays a generous fee for international shipment, but the assurance it provides is a necessity. The company estimates that three to five percent of their business will be in immediate jeopardy if the Ex-Im Bank’s charter is not reauthorized in October. Without the backing of the Export-Import Bank, growth and expansion will not be feasible for small businesses like Price Pump.