With Ex-Im Bank’s Future in Question, Illinois Firm at Risk of Shrinking
L&J; Technologies – Hillside, Illinois
L&J Technologies, located in Hillside, Illinois, 15 miles west of Chicago, is faced with a grim prospect: losing one-third of its business in the coming months. Is a sluggish economy to blame? No, it’s growing here and in most parts of the world. Heightened competition or declining demand for its tank fittings and liquid level gauges? Not that either. Rather, L&J, like many other small- and medium-size U.S. firms, is at risk of losing its international customers if Congress fails to reauthorize the U.S. Export-Import Bank (Ex-Im).
About one-third of L&J’s annual revenues and an equal percentage of its 130 employees are dependent on the company’s exports to more than 40 countries in every continent except Antarctica. For some 15 years, Ex-Im has provided L&J with credit insurance, ensuring that the company receives payment for its tank fittings and liquid level gauges in the event that customers are unwilling or unable to pay. It also provides loans to L&J’s overseas customers with which to purchase its goods.
“Not having Ex-Im credit insurance would expose us to way too much risk, to the point where we wouldn’t be able to export,” says L&J Controller Bob Schwaan. “The Bank helps us manage risk, which is a very important service for a small business.”
L&J is in an aggressive growth phase. Its headquarters in Hillside has excess factory capacity and lots of undeveloped land on which the company hopes to build to accommodate increasing production of exports. L&J has partnered with the Alliance for Illinois Manufacturing to identify and pursue overseas customers by participating in matchmaking exercises and trade delegations. But it could all be for naught if Ex-Im loses its charter, Schwaan says.
“The Export-Import Bank is extremely helpful to American manufacturing,” he says. “It’s not as if the Bank is helping L&J cannibalize jobs and opportunity from other states. It’s helping all U.S. manufacturers send our goods overseas. How is that a bad thing?”