By understanding these details, importers can work with a customs professional to identify the relevant Harmonized Tariff Schedule (HTS) commodity classifications. Allowing ample time to understand import requirements is similarly critical. “Seemingly straightforward products may require permits and additional documentation, or may be subject to anti-dumping duties,” Lewis says. Determining whether this is the case takes time. 11 AUDIT AND UPDATE YOUR COMPLIANCE PROGRAM To ensure trade compliance programs remain up to date, importers should complete annual self-audits to review customs brokers’ powers of attorney, check names and addresses on file with U.S. Customs, review instructions for customs brokers, and request updated certificates of origin. Bidwell recommends importers, if they haven’t already done so, determine if they
qualify for Section 301 tariff refunds. In early 2022, the Office of the U.S. Trade Representative reinstated 352 previously expired Section 301 tariff exclusions. This opens about $1 billion in potential savings through the end of 2022. 12 REMEMBER PEOPLE AND STRONG PARTNERS Technology is critical to an effective importing operation. Yet, “no software or technology alone can prevent issues or problems in any company’s supply chain,” says Brian Bourke, chief growth officer with SEKO Logistics. Solid logistics partners can provide options such as different routings or help convert ocean shipments to air when necessary. They also can offer transload and other warehousing and temporary storage solutions. Strong partners, along with solid insight, software, and technology “can be the best hedge against increased volatility, uncertainty, ambiguity, and complexity,” Bourke says. n
processes. One example is a “peel- off program,” in which containers belonging to participating cargo owners and trucking companies are positioned in separate stacks in the terminal. The trucker takes delivery from the grouped containers on a last-in, first-out basis— essentially “peeling” the containers from the top of the stack, eliminating the need to locate specific containers. The reduction in congestion, waiting time, and turn times improves terminal service for all users, according to the West Coast MTO Agreement. To ensure priority freight is moved first, importers can leverage deconsolidation services at the ports. Inland port intermodal (IPI) and reverse inland point intermodal (RIPI) are other ways to minimize delays by moving work away from port congestion. 9 PAY ATTENTION TO CUSTOMS PRIORITIES Among U.S. Customs and Border Protection’s priority issues is forced labor. “Companies have to know if they’re using forced labor,” says Jo-Anne Daniels, president and founder of Trade Resources & Associates. Products found to have been manufactured with the use of forced labor anywhere in the supply chain could be seized and/or not be allowed to enter the United States, she says. Checking for forced labor in supply chains often requires mobilizing “boots on the ground” to examine operations, Stinebower says. 10 KNOW YOUR PRODUCTS THOROUGHLY Thorough knowledge of your products is essential to “successful and compliant customs transactions,” says Adam Lewis, co-founder and president of Clearit USA, a customs compliance company. This includes knowing, among other facts, the country of manufacture, the product’s end use, its composition, and, in some cases, the manufacturing process. “All play a role in identifying, classifying, and assessing the rate of duty for any given product,” Lewis says.
As products from cars to home appliances become smarter, demand for computer chips has spiked. The median inventory of semiconductor products dropped from 40 days in 2019 to fewer than five in 2021. And from mid-2020 and through 2021, semiconductor fabs, or foundries, operated at greater than 90% capacity, reports the U.S. Department of Commerce. Automotive companies have experienced the brunt of the shortage, due to their just-in-time manufacturing operations, the complexity of their products, and safety regulations that require the use of specific semiconductors and production facilities. How can auto and other companies navigate the shortage? Diversifying sourcing could be one solution, but it requires time and may not always be possible due to the availability of labor, materials, energy, and the ability to quickly establish quality controls. “Implementing a more robust inventory management system that prioritizes fulfillment toward best orders, optimizing replenishment across all company locations and deploying AI-based solutions to reduce waste may be the best ways to preserve profitability,” says Inna Kuznetsova, CEO of ToolsGroup.
October 2022 • Inbound Logistics 37
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