International Logistics - Customs, Transportation And Intermediaries

International Logistics
Customs, Transportation and Intermediaries

Agenda

Customs

Trading around the world
Rankings reflect the average rankings based on # of documents, length of time and overall cost to complete an import or export transaction
Source: The International Bank for Reconstruction and Development/The World Bank, “Doing Business in 2007: How to Reform.”

What importers need to know

Customs – efficiency improvements
adopting new technologies and management systems to reduce delays, documentation and administrative fees which increase trade costs, increase domestic prices and restrict countries from trading
risk management techniques are continually being improved
intention is to focus on higher-risk cargo

Customs – efficiency improvements
risk-assessment of cargo prior to arrival
after-clearance audits
uniform customs forms
electronic filing

Canada Customs-key concepts

CBSA
Source: http://www.cbsa-asfc.gc.ca/

CBSA Responsibilities

CBSA Umbrella
Canadian Food Inspection Agency
Enforcement program of Citizenship and Immigration
Appeals and Compliance branches
Immigration
Intelligence
Customs

Services Offered
because of their sheer volumes and the often sensitive nature of the issues they address day-to-day, how they do their job could impact the level of confidence Canadians have in our government and economy

Services Offered – Customs Commercial Operations

Services Offered
serve 170,000+ commercial every year
process over 11 million commercial releases annually totalling ~ $350 billion in value

AIRS – automated import reference system
CFIA-AIRS: user-friendly, searchable database of CFIA import requirements
series of questions and answers leads the importer through the applicable regulations, policies and information on all CFIA import requirements for specific commodities

Customs D-Memoranda: D3 Transportation

CBSA effect on international trade and logistics

Transportation Modes
air | water | rail | truck | pipeline

speed of delivery time
cost
dependability in meeting schedules
capability to handle various products
availability to serve a variety of geographic points

20
Enablers
quality of transportation services
service considerations
cost
quality of transportation infrastructure
quality of information systems

21
Geographic Considerations
topography – mountains, water…
population concentration in major cities in the developing world
distance between major population centres

Canada
one central warehouse model
central DC + regional DC’s
regional DC’s only
wholesalers/distributors
parts depots…more centralization
Population Density
Source: atlas.nrcan.gc.ca

23
Canada
DSD (direct to store delivery)
store-addressed shipments for cross-docking
channel length
retail concentration

U. S.
one central warehouse model
central DC + regional DC’s
regional DC’s only
parts depots
Population Density
Source: wikipedia.org

U.S./Canada Combined
DC’s positioned to service both countries
call centres

26
Western Europe
trend away from separate country DC’s to single EU DC’s
short sea shipping and inland barges common
23 official languages within EU (product/packaging differentiated by market)
more product-specific warehousing
ERP systems facilitate multiple languages, sales credit, taxation differences
Source: europa.eu

27
Japan
low retail concentration
long channel length
long-standing relationships between manufacturers, wholesalers and retailers
highly regulated trucking…multiple transfers
differences in distribution system based on product
short distances offset by traffic congestion…JIT impacted
“island country” – transport on coastal vessels
government trying to reduce trucking
Source: wikipedia.org, cia.gov

28
China
complex supply chains
government control
difficult logistics – “lean”, not demand-driven
lower labour cost so transporting cost changes have larger impact
larger, less-frequent deliveries (carry more inventory)
JIT will require additional DC’s

29
Eastern Europe/ Russia
difficult logistics
not customer-focused
poor infrastructure

Cost
Time
Improve efficiency and effectiveness of the export / import process
Customer Satisfaction
Purpose of Intermediaries

31
Intermediaries

transaction-based service or contracted to manage process for exporter / importer
door-to-door services that are used by virtually all global corporations

charter vessels
tracing
consolidation
documentation
obtain insurance
worldwide capability
COD deliveries
consulting
pay freight charges
source transportation services - including “deals”
translation
Pick Up and Delivery (PUD),
expediting
export packing
International Freight Forwarder

33
Similar role as International Freight Forwarders but only do air shipments
consolidators (independent)
agents (represent individual airlines)
2 TYPES
Air Freight Forwarder

34
also referred to as NVOs or consolidators
Consolidate shipments from several shippers, accept all responsibilities for documentation ...act as carriers
Not able to clear customs
May provide ocean transportation services to a forwarder (often owned by them or by carriers)
Non-Vessel-Operating Common Carriers (NVOCC)

Export Management Companies (EMC)

36
Buy goods in home market, sell in export markets
Financial risks associated with foreign markets reduced
Creditworthiness of ETC is major risk
Export Trading Companies (ETC)

Guide import shipments through Customs
Deliver goods to importer
Generate customs documents for export shipments
May specialize by commodity, mode
Electronic communications critical for speed
Customs House Brokers

38
Goods Surveyors