Automating to Achieve Compliance
Challenges & Objectives
To increase their customs compliance rating which would address the number of customs audits, examinations and entry documents required. To reduce the opportunity for errors and use electronic information to improve data integrity while containing costs.
Strategy
Develop a highly automated and process-driven program to receive and process electronic commercial invoice information. Establish a dedicated team of automotive customs specialists who will prepare and process entries. Customs information is then passed back to the customers' trade management system, for use, analysis and record retention.
Customized Solution
Entry Maker™, our proprietary software application, was enhanced to smoothly accept the customer's electronic invoice information into our customs brokerage system. Our skilled automotive team used this information to process customs declarations. The results were passed back to the customer's trade management system. This allowed the customer to view and analyze their data, pass critical information to their vendors and track their compliance improvement.
A leading automotive manufacturer sought a highly automated and process-driven national customs broker to process customs entries, manage electronic entry data and support their compliance requirements while reducing overall program costs.
The customs broker needed to receive and process electronic commercial invoice data, provide skilled entry preparation services and feed the data back to the customer's trade management system. One requirement was to systematically ensure accurate and consistent classification of their imported products. The improved process would need to drive their compliance program and ensure that they had achieved "low risk" importer status. The goal was to reduce costs and virtually eliminate product delays due to Customs examinations.
Southern Border hub processing of rail and truck shipments as well as the advent of an Automated Manifest System environment added to the complexity of the situation.
Expeditors employed its Information Technology Group to develop enhancements to its proprietary software application, Entry Maker™. These enhancements would allow complete automatic data processing without data manipulation. This improved the reliability, integrity and accuracy of the data.
A team of customs automotive specialists was established to manage the entry process. Due to the volume of entries, the transition to electronic invoicing and paperless exchange of shipment and entry information was critical.
Through these changes, Expeditors was able to eliminate re-keying broker invoices by providing electronic invoicing. Further efficiencies were gained through the use of an electronic third party billing passthrough into the customer's trade management system at the general ledger code level. Through Entry Maker™, we capture third party fees such as wharfage, terminal and destination delivery charges. This eliminated the expense of re-keying manual invoices for vendor payment.
Significant savings were achieved by accelerating speed to market. For example, the cost of a customs examination includes freight costs, labor, storage and revenue delays in bringing the product to the showroom floor.
These enhancements, combined with a strong partnership, drove their compliance rating up from 69.8% to 99.2%. Customs has recognized this improvement by placing them the lowest risk category available to Primary Focus [Automotive] Industry importers.
Results
- Compliance Rating: 69.8% - 99.2%