Why You Shouldn’t Rely Only on Your Supplier to Handle Your Imports
June 14, 2023 Uncategorized
When it comes to importing goods, businesses often rely solely on their suppliers to handle the entire process. While this may seem like a convenient option at first glance, it presents considerable risk to your supply chain.
What are the risks of letting your supplier handle your shipments?
While your supplier may be responsible for manufacturing and shipping the goods, leaving them solely in charge of the import process can expose your business significantly.
Importing goods involves navigating through different stages of a complex shipping process, including customs clearance, preparing a considerable amount of documentation and dealing with various modes of transportation. Suppliers, although proficient in manufacturing and shipping, may not possess the expertise or resources to efficiently manage the complexities of these processes.
The result may mean delays in your cargo arriving. This can lead to increased costs, missed deadlines and – ultimately – customers who are dissatisfied with your service because you couldn’t supply them with their goods.
Customs clearance, in particular, can be a time-consuming and intricate procedure. It requires submitting accurate and complete documentation, complying with complex import regulations and addressing any potential issues that may arise during the inspection process. Suppliers who lack experience in dealing with customs authorities may encounter challenges in securing timely clearances, leading to unexpected delays in the arrival of your goods.
2. Compliance risks
Suppliers are in an industry of their own and cannot assume that they employ in-house experts who are consistently across changing regulations and international laws.
In short, you cannot expect them to know how to manage compliance risk.
Compliance with import regulations is a critical aspect of international trade. Failure to understand and comply with those requirements can result in penalties, fines and other legal consequences for you and your business.
When suppliers handle imports, there is a risk that they may not be up-to-date or may overlook compliance requirements.
A freight forwarder, on the other hand, has the knowledge and experience to manage compliance effectively, ensuring that all necessary documentation and procedures are in place.
3. Lack of control over the supply chain
If your supplier handles the imports, your supplier controls the outcome. Relying solely on your supplier for imports means relinquishing a significant amount of control over your supply chain.
You will be trusting your supplier to provide updates, deal with complex issues of customs if they arise and handle problems that may not be in their expertise.
Without visibility and control, you are left unaware of potential issues or bottlenecks that may arise. This lack of control can lead to a breakdown in communications, inefficient logistics and an inability to respond effectively to changing circumstances.
By contrast, working with a freight forwarder, you gain greater visibility and control over your supply chain, allowing you to make informed decisions and mitigate risks proactively.
Real Examples Of What Can Go Wrong
Below, a few examples, according to our own experience.
- Issue 1: For this CIF shipment, the documents sent via express post actually took a week to get to their destination, as opposed to the guaranteed one business day. Even though a second copy of the documents was soon requested by our staff and sent by the consignee, the final outcome was a delay in getting the cargo release from the carrier which, in turn, resulted in storage at the terminal and less free time to return the empty container. This could be prevented or monitored more easily had the freight forwarder managed the entire shipment from the beginning, under EXW incoterms.
- Issue 2: for this shipment, the co-loader did not report the manifest document to Australian Customs prior to the vessel arrival, as per Border Force guidelines, putting the container at risk of going into storage. Luckily, our diligent staff was able to notice the non-compliance on time and act on it to prevent a costly outcome.
- Issue 3: When cargo traditionally moves through a regular service and then changes, this can raise suspicion from the Australian Border Force, which can result in cargo being held for inspection by customs. Local expertise in the best way to route your cargo is another benefit of working with a local freight forwarder.
- Issue 4: In this other CIF shipment instance, the LCL cargo was presented to the driver unsecured on pallets, which is a breach of the Australian CoR regulation. We requested our driver to repack it at the unpack depot to ensure it was secure for transport. The breach was on the unpack depot’s part by not securing the cargo correctly as it came out of the container and then presenting unsecured cargo to the driver for loading. Ideally, the cargo should have been palletised prior to despatch, at origin. This could be avoided had the buyer arranged a local freight forwarder to manage the shipment, under the EXW incoterm.
Benefits of working with a freight forwarder to manage your cargo
Simply put, a freight forwarder is a company that specialises in organising and coordinating the shipment of goods on behalf of importers or exporters. They act as intermediaries between the various parties in international trade, such as importers, manufacturers, shipping lines and customs authorities.
They have in-depth knowledge of the various moving parts that make up international trade, which places them in an ideal position to help you streamline your supply chain.
- Real-time support – a local freight forwarder will have access to advanced tracking systems that integrate with your shipment’s transportation networks. They will typically set up notifications from carriers and alerts to keep their clients informed about important updates regarding their shipment, from origin to destination.
- Import risk management – Freight forwarders have knowledge of various risks and challenges that can arise when importing goods, such as damage, theft or delays. They can provide advice on risk mitigation strategies and assist in arranging cargo insurance to protect their clients’ shipments. They understand the terms and conditions of insurance policies and can guide clients in selecting appropriate coverage.
- Trusted transport networks – Freight forwarders have established relationships with trusted carriers, agents and logistics providers worldwide. Leveraging their network, they can secure competitive rates, reliable transportation and timely delivery for your imports.
How ICE can help you
Don’t leave the success of your imports solely in the hands of your suppliers. By partnering with a freight forwarder like ICE, you can mitigate your import risks, ensure Australian compliance and optimise your supply chain.
Our expertise, real-time support, and personalised solutions will streamline your import process and provide you with greater control over your supply chain.
Contact ICE today to discuss your import needs and experience the benefits of working with a reliable freight forwarder.
or call us on 1300 227 461
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