Global Logistics Software Smoothes Regulatory Issues for Trade Security

Jan. 1, 2003
The headaches caused by missing customs documents, improperly screened trading partners, and poorly classified shipment inventory are tackled by todays

The headaches caused by missing customs documents, improperly screened trading partners, and poorly classified shipment inventory are tackled by today’s global supply chain software. And keeping all interested parties informed about shipment status and possible delays requires a well-connected computer network. When it comes to import and export, the new emphasis is on trade security and homeland security, making it more important than ever to get your shipments in order.

Stephanie Richelieu, senior vice president of products and services for Qiva, a supply chain software vendor, says, “Since September 11, our company has focused on rebucketing our software’s global logistics functions under the banner of trade security.” That includes all elements that go into trade security like:

• Full audit visibility for import, outbound or export orders;

• Tracking who touched a shipment and where the shipment has been at all times;

• Weighing the load at various points along the shipment to ensure there is no more or less than is expected in the load;

• Alerting trading partners when a shipment is overdue or if data needed to create the proper paperwork is missing;

• Using automatic identification like RFID tags to track and locate shipping containers;

• Capturing down to the SKU level all the import data required for regulatory documents, including customs declaration forms.

Richelieu says that RFID tags are an important innovation for container tracking, with Savi Technology having made its mark with tags during Desert Storm. “The ports are wired to read these tags and GPS systems are in place to track the containers. That is just one piece of the logistics package because you also have to track what is in the container and who touched it.”

Another challenge for companies that export and import is screening -- comparing the parties and logistics providers you do business with against a stack of denied party lists from the U.S. government and other nations. “You’ve got to make sure the individuals you’re working with aren’t national security risks and known violators of export regulations. These parties may transport goods that are potentially dual-use for military and nuclear proliferation,” says Richelieu.

Because of global logistics software, the cost for small or mid-size companies to screen their trading partners is coming down. For example, Qiva’s Export Management Systems Module software automatically checks every trading partner and logistics carrier against about 30 governmental lists of prohibited individuals and companies, eliminating a cumbersome manual task.

The Bureau of Export Administration and others that have mandated import/export regulations in the past always had a bit of a battle going between government and industry over what companies were legitimate to do business with. But the wave of homeland security has washed away a lot of industry arguments, and there is a stronger potential for what were shipping recommendations to become law.

With less than two percent of incoming shipments to the U.S. being opened and audited by the Customs Service and the need for increased trade security, you can increase the chances of passing governmental regulations by providing the kind of audit trail to customs officials that gets down to the keystroke level of who touched the goods and what happened to a load.

“In the past, there were programs to allow some major importers to file one import declaration a year rather than every time a shipment comes through,” reports Richelieu, “but that won’t be good enough anymore given homeland security.” She predicts that an adjustment will be made for preferred importers, so long as they can demonstrate the kind of audit trail that global logistics software provides.

Also, global logistics software generates all the right documents for any shipment sent between any two points and double-checks that the goods are classified correctly. Missing or incomplete documents are the No. 1 reason for border delays, and that’s where this kind of software gets the details right.

-- Christopher Trunk, managing editor