#customsbrokerage the secret key...

An older piece I wrote a few years back regarding some insights while selling customs brokerage services to bring added simplicity to your supply chain.

A much needed part of the process. IF NOT UNDERSTOOD AND PROPERLY PROCESSED EVERYTHING STANDS STILL. Nothing moves, charges add up and projects come to a grinding halt!

CUSTOMS COMPLIANCE: THE PROBLEM WITH CUSTOMS BROKERS working within a complex project environment working with thousands of HS codes & SKUs.

The problem with some of the brokers is that they only look to solve documentation problems in?MID-STREAM. Rarely are they addressed proactively.

Once the documents have been received and once the entry must be submitted to customs for prompt clearance. Problems with clearance cause delays, container demurrage, storage charges in some cases fines/penalties/seizures if done incorrectly. Customs brokers (some of the ones I've worked for anyways) do not address the issue at it's core - the exporter and the importer's control of the importation process.

They only correct commercial invoices and in some cases for ever entry, every time! Some brokers use automated cue systems where different people handle each clearance. Multiple documentary issues are never corrected permanently. They are handled and corrected on a per shipment basis, every time. Other brokers source out some entries to overseas organizations so these problems are never brought to the surface at all. Some are handled by junior entry staff who only correct them and have no time to have a meaningful discussion with the customer. Some are corrected with the customer never knowing there was a problem.

Most customs brokers are great firefighters but rarely do they remove the match from the hand of the person setting the fire! They just put each fire out, no matter how many there are!

Some customs brokerage companies and respective sales reps do not address and provide import requirements to the customers. Understanding of the process is a given and mistakenly so I fear for many embarking to import. Too many importers do not understand the importation process and the repercussions if done incorrectly.

So where does the responsibility lie and how can this problem be resolved? Early on during the development of your scope of understanding for your complete supply chain & especially in the development of a SC plan for your project.

Functioning in multiple customs regimes for export and importation formalities from/to global suppliers. Products must move. Products must move on time & within budget.

Imagine purchasing OCTG pipe from China only to learn after of new duty increases & a changing trade environment. What does this do to your costs, your schedule, your ability to re-source at a similar price/quality from another country? Your job to know, your broker's job to navigate the waters of these changing seas.

For all importers, know exactly what is needed to import items. Have supplier's technical brochures and information on the products you are importing. Have proper HS codes and have these approved by your broker?BEFORE YOU IMPORT. Speak with your broker to ask them what they need. Speak to your customs broker regarding developing an?IMPORTATION PLAN?and monitor this regularly. Do your documents have all the data elements required to process a customs entry with ease? How much do you import, from which countries, commercial values, which entry points, can any duty relief be awarded be achieving a favorable CBSA ruling. What trends are your customs broker seeing in regarding to globalization, utilizing different origins points, possible trade challenges & duty implications?

You can guarantee that once shipments are rolling in, the problem will be more difficult to correct & manage -?address the potential problem proactively and regularly.

If you are getting calls from your customs broker regarding your imports, the documents and the content/info on the documents you are not doing your job properly. You are not utilizing your customs broker for their value. You are not understanding the importation process and you are not being educated by your customs broker as to what they need to do their job correctly.

You need to know this - it's not a maybe, it's a must.

Sure things are lost in translation (literally as in the language) as globalization takes hold of the business world but these problems must be addressed in order for products to move across borders smoothly and efficiently, without delay. Are documents translated to English - the destination countries required language?

Importation should be easy. With proactive planning and proper "educate me" discussions with your customs broker delays should rarely occur. Understand your requirements and push your suppliers for proper, approved documentation to start.

The answers are out there, you just need to ask!

Now the big question,

How to take on the task of reviewing importation compliance & cutting costs?

Develop a larger summarized list to maintain a dynamic and actionable compliance plan - take intel from major Canadian customs brokerage websites as many have wonderful resources available for free.

From these sources, complete a list to develop a company profile so you can properly RFQ your customs brokerage business on a yearly basis even.

This change in thinking and direction is not difficult as to change your customs broker only a signatory officer must sign off - once pitched internally in your org and cost savings are realized this should be an easy process.

Savings can be substantial as some brokers still have customers on?ancient brokerage schedules?and are?unwilling to even have the dialogue with the customer regarding price.?Some overcharge knowingly adding on a multitude of "valid" fees, therefore making the discussion of "rate" something?the customs broker is actually fearful of having with the customer.

Lack of knowledge about what you are paying for is no longer an excuse to over pay for services received - ask your CFO about this fact and he will agree.

If the customer has developed a proper company provide, HS code list of items imported, basic knowledge learned from multiple online sources, this bid process to reduce your brokerage costs could be a yearly process for you.

Use a standardized process, develop a SKU/HS code list and detailed info on each commodity / build your database and keep it fluid and dynamic. A broker can help you in building and maintaining this.

Utilize information available, utilize your broker properly. If you need some more info just reach out and I'll put you into contact with some of our customs brokerage professionals.

ABOUT:?Mike is a 35-year career logistics business executive & business observer focusing on collaborative, transparent & simple solutions for regional and global stakeholders, EPCs and equipment manufacturers.

He is adding personal, creative, fresh, simple strategy and innovative solutions & project management perspectives to a complex market through customer focused discussion and review. He is an outlier in the usage of social media, connecting and creating massive value for customers.

Offering ANOTHER CHOICE for capital project logistics management, transportation/customs brokerage & supply chain services globally. Our team is ready!