Stronger Dollar Gives Exporters A Headache

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For years the federal government has been urging small companies to help cut America's huge trade deficit by exporting more goods abroad. Now some firms that took that advice are wishing they hadn't. The dollar's increasing value means the prices of their goods overseas are soaring.

"We're getting almost weekly calls and Telexes from clients saying, 'Can't you do something about this for us?" says John Deegan, present of Dexim, a small trading firm in Concord, Mass., that does consulting work and helps customers sell their goods abroad. "In some cases the effect of the dollar's surge is like increasing a product's price by 40%."

Deegan estimates that his firm may lose a million dollars in export sales, although his losses are cushioned by ownership of a packaging plant in Germany that both reduces freight costs and allows him to pay some of his bills in German marks. A hobby kit maker in the Midwest who sells to clients throughout the world said the rising dollar has "cut our export sales right in half."

Since last November's election, the number of French francs it takes to provide a dollar's worth of revenue to an American firm has increased 37%; the number of German marks has risen 33%; the number of British pounds has risen 37%, and the number of Japanese yen 11%.