The Bottom Line: Leveraging trade compliance management

   The events of Sept. 11, 2001 significantly integrated “trade compliance management” to the forefront of every global supply chain’s operation and ultimately a necessary component of successful importing and exporting.
   Here we are some 15 years later and the functionality of global trade includes compliance in every aspect of how goods and services move in international business.
   Almost every company, service provider and carrier today engaged in global supply chain operations has at least one dedicated person with responsibility for trade compliance or it is one of the many “hats” one wears within a logistics and transportation management role. 
   However, many supply chain professionals view trade compliance as an intrusion of government regulation and oversight, and to an extent that could be a truism. Many see it is a necessary evil related to managing the impact of terrorism and keeping our country secure and safe.
   Irrespective of your view, it is a reality of expense, time and resources that we all must manage in our supply chain operations, purchasing and export global reach.
   Having said all that, many corporations have embraced trade compliance as a corporate silo, that managed successfully can reduce risk and cost, as well as improve effective operations and performance.
   Key edicts of trade compliance are:
     • Due diligence;
     • Reasonable care;
     • Supervision and control;
     • And engagement.
   Government agencies, such as but not limited to Customs Border and Protection, Bureau of Industry and Security, and the State and Treasury departments, are all very proactively engaged in regulations, operating guidelines and legal controls on how companies manage their import and export operations.
   They require companies to follow these guidelines as principal importers and exporters along with the companies providing freight forwarding, customs brokerage and related transportation services to follow the four edicts outlined above as general guidelines, followed by a vast amount of regulatory minutia that needs to be incorporated into their global business operations.
   Of the more than 50,000 companies here in the United States involved in global trade, a small number have embraced trade compliance as a tool to gain competitive advantage.
   Examples of trade compliance areas that can provide operational or financial benefits include:
     • Access to government programs such as the Customs-Trade Partnership Against Terrorism (C-TPAT) and Free and Secure Trade (FAST) that move freight more quickly through the borders;
     • Less opportunity for fines, penalties and the hassles involved in delays and seizures;
     • Correct utilization of the harmonized tariff codes to lower duties;
     • Access to foreign trade zones;
     • Utilization of bonded warehouses;
     • Leveraging of free trade agreements;
     • And utilization of technology.
   There are numerous methods for how companies can change their mindset about trade compliance and utilize it both as a necessary point of control, but more importantly as a method to reduce both risk and spend, and thereby providing certain advantages.
   Trade compliance professionals need to maintain a regular flow of information, intelligence, and regulatory updates to be in the best position to maintain operational excellence in global supply chains.
   Successful trade compliance managers can contribute to:
     • Keeping companies out of regulatory entanglements;
     • Reduce risk in the global supply chain;
     • Provide competitive options in how goods and services move internationally;
     • And impact bottom line profits and margins.
   Successful trade compliance managers need to be contemporary in the information flow necessary to maintain the challenges they face in handling the multitude of compliance and regulatory concerns not just here in the United States, but in all the countries they import from or export to.
   Periodicals and information sources such as the American Shipper offer a very reliable and contemporary flow of data that can be very useful in leveraging trade compliance opportunities.
   Accessing key government websites, such as those belonging to CBP and BIS, is another option.
   Continuing education and training are also critical elements of any trade compliance program and the process of learning contemporary options in importing and exporting. The American Management Association and National Institute for World Trade are two excellent options for certificated public and in-house instruction, coaching and educational capabilities specializing in international business and supply chains.
   In August, American Shipper will host an Executive Summit in New York, “The Data Driving Next Generation Logistics,” which will provide a remarkable interface with many trade professionals, offering them timely intelligence on the use of technology in their global supply chains.
   Conferences and seminars offer many excellent and intense information flows that can be both of immediate and long-term value, along with the benefits of networking with professional colleagues who are inevitably facing the same trade compliance challenges as you.