Global Trade Management is the overall process of ensuring that goods are imported and/or exported efficiently in light of changing customs requirements and tax laws. It involves knowing the origin of the goods, working with brokers and other customs facilitators, as well as government agencies and transportation carriers. For every import/export shipment, companies need to understand at least two countries’ rules and laws.

      In our post 9/11 global economy, customs requirements continue to change frequently. Currently, logistics and enterprise resource management (ERP) systems contain useful information about inventory and the location of goods at a given time. GTM systems can utilize this information and then augment it with information from various other sources that help identify non-compliant shipments.

      The goal of GTM is to help make the delivery of goods as efficient as possible both from a time of delivery as well as a tax perspective.

      In the past, companies relied on import/export experts to know and record trade information. The hope was that anything missing or incorrect at a border would be quickly corrected there while the goods waited for the necessary approval to continue on. Additionally, regulatory agencies have been increasing their level of automation that subsequently requires importers/exporters to provide information to the agencies in very specific formats and protocols. GTM systems help companies to archive and deliver information that is necessary to meet this plethora of compliance requirements.

How is GTM done today?

      Most GTM systems were created to assist users with final documentation or processing needed to ensure customs compliance. GTM systems maintain relatively static information – that is, they can’t easily update the information contained in the system. In many cases, GTM systems require users to re-key information into them that may originate from 3-4 other systems such as a bill of lading, goods classification, P.O.s, and ASN information. This manual keying can be time-consuming and prone to human error. It is practically impossible to maintain a truly up-to-date picture in the GTM system due to the amount of information and frequency of changes that occur. The few GTM systems that do offer a basic level of automation enable content to be updated electronically, however, these systems still require user action to trigger the update process. This causes two challenges: First, busy users (and/or IT personnel) must remember to trigger the update processes when appropriate; and second, because the content is completely updated and overwritten, users cannot maintain exception handling. User-defined changes such as approved customer lists, approved goods substitutions, new product classifications and other acceptable exceptions will get erased and must be re-typed each and every time an update is done. The company must also keep track of external content and obtain copies which must then be uploaded into the GTM system. Besides the basic hardware and software maintenance, legacy GTM systems perpetually require watchdog awareness of new and updated content and thereafter internal resources must be spent to upload and use this point-in-time trade information.

      Further, if trade information is not specific to the actual transaction being done on a particular day, importers and exports run the risk of having exception shipments stopped at a border. This can happen due to a number of factors. For example, regulatory changes may occur while goods are in route or exceptions may be discovered related to a particular shipment that was not depicted specifically enough in the GTM software. Sometimes users ignore important system warnings because they may assume the warning is a common false positive result. Even if taken seriously, such individuals can’t (or simply don’t) incorporate their own real-time trade knowledge into the process.

      Whether caused by errors (human or computer), or due to a lack of timely information, the bottom line is that today’s GTM systems are far from foolproof and therefore can cause unnecessary stoppages, delays and/or overall inefficient trade and inventory management.

What is Real Time GTM?

      Real Time GTM provides more up-to-date information to make accurate global trade decisions. Not only can it help users plan better, it can help redirect goods with late breaking information that would otherwise cause a problem or offer a delivery advantage. RT GTM systems give users a much more dynamic view of the global trade situation and how to best handle their goods given the current circumstance. One might compare traditional GTM systems to driving to work at 8 a.m. using a 7 a.m. traffic report. Having a real time view of traffic - or trade - can save significant time and aggravation. This is what Real Time GTM is all about.

      To accomplish Real Time GTM, there are three key elements:

      •Compliance – knowledge of global compliance regulations, which is challenging as companies expand their supply chains to more countries.

      •Content – information such as free trade agreement regulations, denied party lists, controlled product license requirements, local country information, tariff schedules, etc.

      •Connectivity – the ability to pull and push critical information to disparate business systems containing the operational transactions and product information. This also includes systems in Customs and other government agencies regulating international trade.

      •All three of these elements - compliance, content, and connectivity - must be working together to form an effective real time, on-demand global trade network.

      RT GTM provides transactional data such as information about substitutions on the production floor, product specification modifications, component sourcing decisions, and changes in product routing and logistics details. As such, with reliable connectivity, the system ensures that the content is constantly updated to ensure the latest trade data is available and applied. The global trade content to which these transactions are being compared is also changing throughout the transaction. Free Trade Agreements are often modified and products that qualified last week might not qualify this week. Persons once on denied party lists are cleared, and new names are added. Controlled item license requirements are refined, requiring new export processes. Tariff schedules are modified and re-harmonized.

      RT GTM also provides anytime, anywhere access to the information so that whether users are working at home, traveling, or located at any non-office location, they can still obtain the necessary intelligence about their imports and exports.

      Lastly, RT GTM systems are scalable and extensible to grow appropriately with a company’s trade needs and/or to add new functionality as trade management innovation and compliance developments move ahead.

The future

      As organizations such as the World Customs Organization (WCO) and offices of Revenue and Customs continue to refine and deliver new requirements, managing imports and exports will remain a challenge for any company – large and small. While countries strive to collaborate and recognize each other’s requirements, there is more work that needs to occur in and between trading countries. Yet despite this uncertain and dynamic landscape, companies must continue to forge ahead importing and exporting goods and doing it as efficiently and profitably as possible.

About Integration Point

      Integration Point, Inc. is a privately held, Charlotte, N.C.-based company. The company was formed in 2002 by a core group of technologists who had worked together in international supply chain since the early 1990s. Today, Integration Point helps some of the best known companies manage more than $300 billion in trade in over 75 countries.

      The firm began developing modular trade management applications that are built on a core platform that allows customers to address numerous compliance issues simultaneously - regardless of the customer’s own internal systems.

      Integration Point services dozens of major firms including 11 of the top 100 businesses in the world. The system, however, can easily serve much smaller firms too, offering the same benefits and efficiencies. Because the system is composed of modular applications, companies can start with any one or more of the trade management components and grow as their import/export needs grow. With a secure, consistent, web-based user interface across components, users can easily learn and use new functionality. Components include: Global Classification, Manifest, Import Processing, Export Processing, C-TPAT, AEO, Denied Party Screening, Free Trade Agreement qualification and global Duty Deferral Programs.

      Integration Point is the first to provide Real Time GTM. Traditional GTM systems are designed to stop non-compliant goods upon reaching a border causing potential delays and even spoilage of goods. Alternatively, Real Time GTM is architected to proactively provide the necessary compliance information ahead of time so that goods keep moving ahead efficiently. Further, with traditional GTM systems, excessive taxes and unplanned expenses can be incurred because companies aren’t able to forecast relevant compliance requirements.