Inbound Logistics | January 2025

S D O C U M E N T A T I O N R

BE METICULOUS. Simple mistakes, like incorrectly listing the country of origin, can cause problems. Similarly, accurately classifying goods according to the Harmonized Tariff Schedule (HTS) should be a detailed exercise based on hierarchical analysis of the products and their physical descriptions. MAP THE SUPPLY CHAIN. Know who’s doing what, Pelli says. To be sure, this probably means corralling volumes of information about a company’s import activities and partners. Big data tools can help. WATCH FOR INDUSTRYWIDE EFFORTS. For example, Yarn Ethically and Sustainably Sourced (YESS) is focused on shifting the industry with a multi- stakeholder approach, says Patricia Jurewicz, founder and CEO of the Responsible Sourcing Network. YESS, an RSN initiative, recently announced its rst cohort, which includes adidas, Fanatics Apparel, and INDITEX. An industry-wide approach can cut costs and boost efciency and consistency, particularly for small and mid-sized enterprises that lack sizable compliance departments. LEVERAGE REALTIME ANALYTICS TOOLS. These can help companies monitor regulatory risks, track carbon emissions, and optimize compliance processes. As a result, these systems enable companies to more quickly adapt to changes, Layeld says. INCORPORATE OBLIGATIONS around reporting and data sharing when vetting new suppliers, says Ashley Hetrick, principal and sourcing and supply chain segment leader, management consulting with BDO. By broaching this prior to the purchasing decision, the buyer has the most leverage. The work required to stay on top of today’s complex regulatory landscape is formidable, but compliance can offer a strategic advantage. “Companies that prioritize transparency, sustainability, and agility in their supply chains are better positioned to adapt to change, mitigate risks, and gain consumer trust,” Layeld says. n

FDA regulations require imported food products arriving at U.S. ports to have proper labeling and factory registration. Failure to meet these requirements can lead to costly relabeling, destruction, or complicated re-exportation.

Moreover, attempts to strong-arm the FDA into releasing products they’re detaining rarely work. “Their goal is public health, not ensuring smooth

to expand globally, Layeld says. The IOSS was created by the EU for VAT administration of low-value e-commerce imports. It can streamline cross-border ecommerce taxation but also adds compliance complexity. To reduce errors, supply chain teams should integrate into their ecommerce platforms automated tax calculation systems that can handle real- time tax remittance. U.S. Food and Drug Administration (FDA) Regulations About 30% of consumer dollars are spent on FDA-regulated products, says David Lennarz, president of Registrar Corp. However, some importers of FDA- regulated products don’t understand the steps to be completed in advance of importing. For example, foreign manufacturers need to register with the FDA and identify the factory in which a product was produced. Importers should check that their foreign suppliers meet the FDA’s labeling requirements, as mislabeled products can be charged with misbranding. Potential corrective actions are less than ideal. For example, petitioning to relabel or destroy the products is costly. Re-exporting 9

commerce,” Lennarz notes. A Compliance To-Do List

Working proactively to minimize the risk of compliance mistakes generally is more effective and less expensive than trying to correct errors once they’ve occurred. Some steps to take: PARTNER WITH EXPERTS. Whether attorneys, brokers, or others in the industry, experts can help companies monitor and comply with changing regulations, Nagarajan says. PAY ATTENTION TO DESIGN. In some cases, about 80% of a product’s lifecycle costs, risks, and environmental impact is determined in the design phase, Barnett says. By making engineering and design decisions with input from procurement, supply management, and logistics, companies may be in a better position to comply with regulations.

ESTABLISH SOUND COMPLIANCE PROCESSES AND PROCEDURES. The

more a company can proactively address potential challenges, the less likely they are to cascade out of control.

products to another country often becomes a logistical nightmare.

156 Inbound Logistics • January 2025