If you import products from outside the United States, it’s imperative to know the available tech tools to help you run a better business. An unorganized import process can lead to higher charges for freight forwarding and for customs fees, delays in shipping and in customs clearance, and an inability to accurately track your inventory.
It may seem daunting, especially if you are new to the importing world. The key to success is learning how to maintain control of the process before your product even arrives in the US; it can make a big difference in your operational and financial efficiencies. Here are five steps every company should include when importing products:
1 - ACE PORTAL - Apply for your own login to your customs portal. The application can be accessed HERE. The ACE Portal gives you visibility into your imported shipments and complete reporting control over your CBP entry summaries, timing and most importantly, customs delays and exceptions.
2 - MANIFEST CONFIDENTIALITY - Do you have a product that is unique? Do you have a patent on your product? Or maybe you just don’t want to let your competitors know where you have it made. Manifest confidentiality will help prevent your product imports from showing up on public searches for product imports. Likewise, if you’re doing research on a competitor, and they have not requested confidentiality, you can find out where they are producing and importing their products. You can also find out what kind of volume they’re importing and when.
Click HERE for a template you can use to request manifest confidentiality. Currently there is a plan in place to replace these letter forms with an online portal for making such requests, but it’s not publicly available yet.
3 - FREIGHT FORWARDING/CUSTOMS BROKER - You must maintain control of your relationships with freight forwarding and customs brokerage. Often a 3PL will have the ability to help you coordinate these efforts, which may be a more convenient option. If you want to switch 3PLs, or have an order shipped to a different location, you might be stuck not knowing how to make that happen. An independent relationship between you, your brokerage, and forwarding vendors means you are in control over information flow. When interviewing brokers or freight forwarder, ask them:
- Do they use a portal for communication with you and logging of paperwork from each shipment or will you be sent daily DSRs (Daily Summary Reports)?
- Do they own their resources or outsource them (trucking, origin services, destination services, customs brokerage)?
- How many options for freight pricing will you be given, based on the specific weight and dimensions of your inbound shipment?
- How many options for freight speed will you be given?
- Will you have your own account manager and daily communication when a shipment is inbound or is there a general service line you utilize?
- How far in advance before a shipment is ready do they need to be notified in order to make all the arrangements?
- What options are available for speed and cost?
LCL (less than container load)
FCL (full container load)
Economy Air (your shipment may be split up into two different flights, reassembled at the arrival port and then passed through for outbound freight)
LTL (less than truck load)
FTL (full truck load)
4 - DOCUMENT TEMPLATES - Consistency is key with the paperwork you need from your manufacturer, your freight forwarder and your 3PL. For example, if you are sending a shipment to a 3rd party, rather than to your own location, you need the origin documents to reflect the proper “Bill To”, “Ship To” and “Notify Party” addresses, otherwise the shipper may not be able to clear your shipment at customs.
BOM - BILL OF MATERIALS
While your BOM will vary based on the specific industry or product, it will usually cover the same basic information:
Product Name: Name of the final product
Part Name: Name of the part or component
Part Number: Assigned number for each part or component
Description: Short description of the part or component
Quantity: List of unit quantities needed for each part
Unit of Measure: Appropriate metric for each part
Supplier/Vendor: Supplier names and contact information
Unit Cost: Cost per unit of each part or component - including the unit cost - to scale your production should another order be necessary
Total Cost: Total cost of each component - calculated by multiplying the quantity by the unit cost
BOL - BILL OF LADING
This is considered as one of the most important documents for shipping transportation. It contains all the information about the product, shipping method, the ship to, the ship from, and the owner of the products. It is also used as the evidence for the receipt of goods.
For example, a freight forwarder has been hired to move a case of reusable straws from overseas into the US port. Before the straws are loaded in the truck, the driver and manufacturing plant representative have to sign the bill of lading. When the straws are safely delivered to the destination, the truck driver has the document signed by the recipient (maybe a 3PL or directly to the customer). This can serve as a proof. It also prevents theft for the company’s assets.
The invoice is the prime document in export. Make sure your exporter has included all of these in their invoice. This is not the invoice you pay, it’s the invoice used at customs to determine the value of the goods to assign customs fees.
Exporter /Consigner: The party consigning the products. The name and complete address of consignor must be included along with Country being exported from.
Consignee: The party to whom the consignment is shipped. The warehouse, a third-party customer or the buyer could be considered the consignee. In some cases, when there is a Letter of credit involved, the bank name is mentioned as consignee starting with “To the order of…” .
Buyer: In some cases, consignee may not be the actual buyer. Then the details of buyer other than the consignee is mentioned.
Invoice Number and date: This reference number is quoted on many documents.
Buyer’s order or PO number and date: The purchase order number of the buyer is mentioned here. If the shipment is under a Letter of credit, the LC number and date is mentioned.
Country of Origin: The country of manufacture of the products.
Country of final destination: This is the destination country of the products.
Vessel / Flight: The name of vessel or flight if available. While mentioning vessel name, always write voyage number.
‘Pre-carriage by’: The term “Pre-carriage by” means, the mode of movement of cargo to port of loading by the shipper. The Pre carriage can be ‘By road’, ‘By Rail’ ‘By air’ or ‘By sea’.
Place of Receipt: Place of receipt of goods by carrier after completing export customs procedures. If you (exporter) are located far from the load port, the cargo can be customs cleared at the nearest Container Freight station and move to the port of loading. If you are completing customs procedures near the load port, the column ‘place of receipt’ and ‘port of loading’ will be the same.
NOTE: If your address or company name is not printed correctly on all documents, you may void your manifest confidentiality. If your company name isn’t correct, the entry summary from customs may not show up correctly in your ACE portal account.
5 - TARIFF CODES - With the addition of the new Tariffs in 2019, it can be easy to lose track of how much you’re paying in import fees. There are subtle distinctions in tariff codes; utilizing the incorrect codes can cost you thousands of dollars. You can’t control what tariffs are being collected, but you can make sure you’re using the most efficient codes that most accurately describe your product. Search codes HERE to make sure your customs broker is using the correct one.
Taking care of your business doesn't have to be complicated but you do have to stay on top of it. We've created this table you can use to fill in your freight forwarding and customs details to track what you're paying and track differences between shipments. Click HERE to email us for a copy.
Importing products doesn’t have to be a mystery and having control over your documentation and processes can make a huge difference for your business.