Respondents to a recent Aberdeen study on Global Trade Compliance Priorities had an average trade compliance error rate of 25.7% on their international orders — why? Because these companies have streamlined their entire import cycle in order to eliminate these common entry errors and verify the import data at every step in the import process.
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How to become a Best-in-Class Organization with
Your Importing Processes
Respondents to a recent Aberdeen study on Global Trade Compliance Priorities had an
average trade compliance error rate of 25.7% on their international orders. For an
importer with 1,000 entries per year, that?s 257 entries with errors. In the same report,
Best-in-Class organizations had fewer errors (less than 4%) and incorrect duty
payments (less than 5%) ? why? Because these companies have streamlined their
entire import cycle in order to eliminate these common entry errors and verify the
import data at every step in the import process.
1. Close the loop in your import processes. The import process begins with the
creation of the purchase order (PO) and ends with post-entry validation. A Best-in-
Class Organization is constantly managing each phase of this process ? does the
information on the PO match the classification database, does the commercial invoice
match the PO and the classification database, does the broker have the correct
classification information to verify the entry before filing, and finally, is the entry put
through a complete post entry validation? By checking import data at every step in
the process (PO to post-entry) Best-in-Class organizations have fewer errors on
entries, and therefore, have a more streamlined and compliant import cycle.
2. Check more than just product classifications. At the invoice level, companies
should verify more than product classification data. A Best-in-Class company
certifies that the quantity and value of the invoice matches the transaction value on
the entry, the PO, the information stored in a global classification system, and what
was paid to the trading partner.
3. Verify free trade agreement eligibility within organization and with brokers.
To fully close the loop in the import process requires more than just correctly
flagging products in a classification database for free trade agreement eligibility.
The products must also be flagged on the entry by the broker, in order for the
importer to realize duty savings for all qualified products. By auditing all entries for
inaccuracies as part of a post entry audit program, the importer is minimizing the
possibility of lost duty savings.
Tips provided by Clay Perry, SVP of Global Markets, of Integration Point, Inc. Contact Clay
Perry and Integration Point at Sales@IntegrationPoint.com or 704-576-3678. For more
information on Integration Point, please visit www.IntegrationPoint.com.