In Friday’s post, we asked if you could solve the compliance challenge before it cost you tens or hundreds of millions of dollars. We noted that the biggest reasons for lack of compliance are lack of knowledge, policy, visibility, analysis, and procurement technology and the fixes are knowledge, policy, and appropriate technology.
One of those technologies is a Procurement Marketplace that can steer (or force) buyers to buy the right products from the right (and approved) suppliers. Another is supply chain visibility technology that lets a company monitor what is going on in the supply chain and evaluate a potential supply base before making a decision. A third is import/export/trade management software that helps the organization identify the regulations it must comply with, collect the necessary information, produce the required documents, make sure the documents get to the proper authorities complete and on-time, and track all of the associated certifications and insurance certificates that go with the products and the supply base.
A good trade solution will address, at a minimum, import/export requirements, ECCN (Export Control Classification Number), custom security programs, FTA/FTZ/SEZ (Free Trade Agreements/Free Trade Zones/Special Economic Zones), country of origin, HS (Harmonized System) codes / HTS (Harmonized Tariff Schedule) codes, DPS (denied party screening), and entry visibility. Essentially it will help a company determine all of the export requirements, all of the import requirements, produce the necessary documentation, and track its product from country of origin to the destination country.
In order for this solution to work, it needs a lot of content. Namely:
- import/export regulations for all of the countries being sourced from, sourced through, and shipped to
- US ECCN database
- requirements for programs such as C-TPAT, PIP, and AEO
- Free Trade Agreements between all of the relevant countries
- database of all FTZs / SEZs in the relevant countries
- HS schedules for all of the relevant countries and mappings
and/or mappings to from country specific schedules
- Denied parties lists for the relevant countries
That’s a tall order. But no longer an impossible one. Stay Tuned.