The Trade Bridge Blog

C-TPAT Kicking and Screaming?

I've met a new SME ally through this blog, Philip Spayd of Global Trade Systems and formerly of Customs. Phil makes a very good point about SMEs and their importance in the supply chain and its security:

"Our clients at GTS—all predominately SMEs...have for the most part approached C-TPAT as an obligation to be fulfilled.  Often they are pressured to join by customers or other business partners who are C-TPAT certified. They did not initially approach C-TPAT from a strategic interest in improving supply chain management or in recognizing risk within the supply chain. They wanted to take the basic actions to achieve certification.  We help our clients fulfill these needs, but also help them to see the benefits they can achieve in recognizing other risks in their supply chain, and laying the foundation for being able to respond to disruptions.

A point that I believe is important for SMEs to understand is that C-TPAT and SAFE, together with the initiates such as pending product safety and legislation, the TSA air cargo screening initiative (Certified Cargo Screening Program), and efforts to demonstrate environmental responsibility within the supply chain, will create entire classes of firms that are known entities that meet basic international security (and safety and environmental) standards, and that many business relationships will be built on this status.  The risks of doing business with companies outside the network of authorized economic operators (or known parties, or whatever we decide to call them) will be too high.

So, my advice to SMEs would be to find a practical way to approach C-TPAT, and to use it not only to achieve C-TAPT certification, but as a platform to recognize other risks within their supply chains, and to move into the realm of being a known, responsible, stable and secure member of the supply chains of which they are a part."  Well said, Phil.

What is 10+2 Going to Cost Us?

Kudos to Jennifer Baxter, Gail Coad and Christopher Chan at Industrial Economics for digging deep to research what 10+2 is going to cost SMEs. They were retained last year by CBP to do an economic impact analysis of 10+2. On Mike Laden's recommendation, we had a lively, in-depth discussion today as they further researched how 10+2 might impact SMEs. It breaks down into these categories of cost: IT, research, changes in terms of sale, transmitting the security filing. And these costs depend upon the complexity of the supply chain, the level of automation, business style, degree of business process change and the costs charged by the broker or ABI service provider. I'll be putting all this information together into a presentation for the American Association of Importers and Exporters on June 3. Look for my upcoming SME importer survey results and the subsequent detailed analysis on the Trade Bridge web site as well.

Prepare for 10+2 NOW

To help importers prepare for 10+2 I found a great document online. Prepare for 10+2 by understanding how importers need to design and build their databases to accomodate CBP's Security Filing. Global Data Mining presented the step-by-step process at the recent National Customs Brokers and Forwarders Association of America (NCBFAA) convention. The best thing about this document is that it gives you enough direction to work with your IT Department or consultant to estimate this part of the cost of complying with the new rule.

We Are Making a Difference

I'm jazzed to report that Trade Bridge is making an impact. We are providing the WCO with some very welcome and much needed feedback from our members, U.S. SMEs. I was in Brussels in December speaking to a SAFE conference about SME views on C-TPAT. TBI Chairman Bruce Wilson goes to Brussels next week to attend the 2nd SAFE Working Group meeting. As an Observer, TBI can provide input and the SME perspective at an international level.

The Canadian SME community, through their trade associations, are also interested in providing the Canadian perspective for Trade Bridge to represent to the WCO. This would be a valuable addition to the Trade Bridge cause which I will be pursuing in the coming months.

Keep your fingers crossed as CBP reviews my application to COAC. If I am appointed, Trade Bridge and its 7000 SME importer-exporter members, will have a direct line of communication to Congress. Is there any question that this is a movement whose time has come?

To C-TPAT or Not to C-TPAT, that is the Question

To view the results of the survey conducted by TBI, Download C-TPAT_Survey_12-07.pdf. Most recently these results have been presented to the CBP annual C-TPAT conference. While the results are more anecdotal than scientific, the sense is that C-TPAT is not a program whose time has come with SMEs. Alternately, most importer SMEs polled reported making improvements in their supply chain security since 9/11 regardless of participation in C-TPAT. These results were also presented to the World Customs Organization in Brussels at the December 2007 SAFE conference by TBI. Initially, I was amazed at the positive and interested response I received from the SAFE conference attendees. However, after sitting through one too many canned presentations of “County X, Y & Z’s security programs” I realized that real information from real companies was a breath of fresh air for the SAFE conference attendees. FYI, to our importer-exporter members, SurveyMonkey and its competitor Zoomerang are a great way to get feedback you’re your customers on how they rate your product/service and how you can improve your product/service. TBI will be using this tool going forward to keep in touch with the attitudes, opinions and needs of SME importers/exporters.

Getting an A+ on Your AES Compliance Review

Jerry Greenwell, Ombudsman for the Census Foreign Trade Division, delivered an informative and entertaining session at the ICPA annual gathering recently. A few key points...

• Don't get confused by the lack of coordination between Incoterms and export regs etc. The only thing to understand is whether the export is buyer or seller-controlled.
• New on his presentation agenda...AES Compliance Review Program...help to avoid costly penalties and being sent to the principal's office, Office of Export Enforcement (ital added for emphasis).
• Best Practices to get an A+ on your compliance review...(I love this one), "Keep your contact data at the Census Foreign Trade Division up-to-date." Duh!
• Voluntary Self-Disclosure is also new...need to report a violation or potential violation? Score brownie points by self-disclosing.
• Routed export transactions (where the overseas buyer controls the movement of the cargo) are not good business practice.
• Option 4, post-departure filing is still under moratorium, "...and probabaly will not re-open..." (This is Jerry opinion.)

Jerry knows his stuff and is available for trainings for the cost of travel and a per diem. If you want to contact him directly call 301-763-6975 or e-mail him.