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The Changing Landscape of Importing and Exporting
By: Felix Pekar, QuestaWeb
Posted: February 11, 2008, from the February 2008 issue of GCI Magazine.
page 3 of 4While firms might attain an acceptable accuracy level relying on staff, the cost to maintain a staff of the size and expertise needed far exceeds the purchase price of global trade management (GTM) technology. And, with the dynamic nature of change in this ever more complex environment, there is no guarantee that human error will not occur. Sadly, errors eventually translate to demurrage costs, inspection fees, charge backs and so on.
GTM Provides a Solution
GTM systems provide a comprehensive solution to all the challenges companies face. ABI-certified GTM systems allow direct receipt of electronic customs transmissions that capture changes in tariffs, classifications as they occur and immediately incorporate them within the system logic. These systems automatically generate and populate documentation and possess built-in checks and alerts when milestones are missed. Most importantly, only GTM can move customs compliance from the realm of “have to deal with every trade transaction individually” to managing trade by exception. That is, GTM only requires human intervention in those rare instances where the system cannot make a clear-cut determination.
True GTM products—not retrofit ERP solutions that seem to be the latest fad—respond to compliance challenges in a coordinated way. The firm’s logistics system is communicating with its ERP system, so there is one point of data entry and error rates decrease to almost nothing. The system automatically attaches binding rulings, ADDs/CVDs and other documents mandated by the HTS code to the purchase order or commercial invoice. The firm can manage vendors, identify manufacture identification numbers, perform scans against denied party lists and even automatically generate the documentation foreign vendors will require to move products out of their country and into the U.S. Product flow is visible. Personnel know where shipments and products are located. The importer/exporter is truly in control.
Because the GTM system captures activity from the point of order entry, supply chain visibility begins to emerge: when the order was sent to the vendor, when the vendor is ready to ship and what quantity of product is being shipped. Letters of credit can be settled, documentation can be generated automatically and entries can be built. The system prompts for missing documentation and provides alerts when pre-established parameters are exceeded or scheduled events are missed. As key information compiles on the company’s server, potential problems become evident before they achieve critical status. The impact pervades a company’s supply chain at every point, yielding control throughout.
Web-deployed GTM systems enable every member of the supply chain with a computer and a Web browser to participate at little or no cost. So when firms ask the inevitable question, “Where’s my stuff?”—staff doesn’t have to go to numerous freight forwarder and broker Web sites to find the answers or pay the prohibitive costs for commercial services that consolidate such information. All the participants in a company’s supply chain are inputting information in one place—their Web-based GTM system. The ultimate by-product is visibility across the supply chain.