Beginning in early 2018, importers of certain products to the United States have had significant additional tariffs imposed on their imported goods. The ongoing trade dispute between the United States and China has hit importers especially hard, with many imported products now carrying an additional tariff of up to 25%. In addition, there has been a significant increase in the number of antidumping and countervailing duty investigations initiated with some antidumping duty deposit rates as high as 1700%. At the same time, U.S. Customs and Border Protection (CBP) has increased enforcement efforts across all products and industries.
All of this activity adds to the existing complexity faced by importers who are struggling to manage a process that is fraught with potential for error and penalties. That’s why Flexport created Trade Advisory Services. Importers can connect with a team of trusted trade advisors to navigate the trade landscape. Flexport’s Trade Advisory Services help importers assess their trade footprint, uncover cost-saving opportunities, establish strong compliance programs, and be better prepared to address unexpected changes in their supply chains.
As the Landscape Evolves, So Must the Navigation
“Over the past few years, we’ve seen changes in customs and trade regulation and enforcement occur at an unprecedented level as compared to years prior,” says Adam Dambrov, Director of Flexport’s Trade Advisory Services. Seldom used special-trade remedies have been brought back with a vengeance and are causing unprecedented amounts of disruption to globe trade. These tariffs were imposed more quickly and more harshly than expected, and many businesses were simply not prepared given underinvestment in trade compliance.
Added complexity also directly impacts supply chains’ bottom lines; customs duties are making up a larger share of importers’ total cost to bring goods to market. “At the same time that we saw the jump in HTS codes, Flexport found that, on average, the percentage of customs duties of total cost of goods sold on US-bound shipments from China increased by 84%,” says Dambrov.
“While larger companies might be able to absorb some of this cost, the increased cost and complexity for small- and medium-sized businesses could mean a make or break situation—part of the driving mission to establish Flexport Trade Advisory Services,” shares Dambrov.
A Tailored, Data-Driven Approach to Trade Consulting
What makes Flexport’s Trade Advisory Services stand out is that it utilizes data analytics through the same platform that Flexport customers rely on to manage and track the shipment of their goods. The insights into patterns and business needs sit behind Flexport trade advisors’ customized guidance. “By using technology-powered data analytics, we can examine your supply chain all the way to the SKU-level, and this allows for a more precise identification of cost-saving opportunities, compliance risks and other inefficiencies or outliers,” says Dambrov.
Flexport’s Trade Advisory Services team provides consulting services that range from trade compliance offerings such as tariff classification, customs valuation, and country of origin analysis, to cost-savings initiatives such as duty drawback and first sale for export. By working with clients on a one-on-one basis to understand their goals, pain points, and businesses, we are able to provide tailored recommendations. “Sometimes clients come to us with an idea of something they’d like to explore, like duty drawback, but often they are open to exploring ways to improve their businesses that they haven’t yet considered,” says Dambrov.
Whether a client has been impacted by the China trade dispute, hit by a customs inquiry or penalty, or is simply exploring opportunities to reduce costs and improve operations, Flexport Trade Advisory Services offers exceptional insight and resources, especially for organizations that don’t have a dedicated trade function.
Currently, Trade Advisory is available in the US, with plans to expand service in Canada, Europe and Asia later this year.