Businesses face daily pressure to keep pace with the ever-increasing international competition. Growth for a business relies on moving into new markets, where it is much more challenging to maintain a supply chain.
New products from foreign markets add uncertainty to import/export operations, making timely production a real challenge. Their supply chain operations are struggling to keep goods flowing consistently and retain positive cash flow for most companies.
A diverse array of supply choices and changing trade regulations, along with juggling enforcement and business needs, are making difficult decisions for even the most experienced supply chain teams. If you are like most companies, the global marketplace presents challenges that you are not prepared for.
Below are four of the most common global supply chain issues occurring in Houston, USA. Go through them and know whether they are impacting your company today or not:
1. Higher International Shipping Volumes Increases Exposure to Trade Regulation Violations:
Global trade regulations change continually, and even the most experienced supply chain teams face difficulties in matching enforcement with business needs. Companies consider themselves, in many cases, ill-prepared to work in the global marketplace.
With the possibility of severe penalties for non-compliance, the enforcement team plays a vital role in the supply chain strategy. The real question is whether they can keep up as your business grows and your shipments increase.
The weakest link rule applies here: getting a good enforcement team at one location means nothing if there are holes in the company’s customs skills at another location. If your company adopts automated approaches and enlists the assistance of Supply Chain Management Experts, the corporation will face needless exposure to substantial risks.
2. Breakdowns in Cross-Border Shipments:
The global complexity of today’s business climate means that businesses need to deliver a varied product portfolio to meet consumer demands in various countries. For products coming to and from several nations, businesses must remain on top of a dizzying variety of trade regulations.
A single error in enforcement, such as missing the current regionally relevant classification and licensing criteria, can put an end to your shipments and prevent them from crossing the border. This delay damages the whole supply chain and adversely affects the bottom line.
3. Inconsistent Trade Practices Lead to Compliance Issues:
International expansion also means entering new markets or adding additional operations. Every extra business arm may include a specific set of operating procedures.
Despite strict adherence to standard operating procedures, businesses are increasingly becoming vulnerable to fragmented business activities, and contradictions are starting to threaten supply chain operations.
Failure to adhere to SOP results in an inability to produce repeatable, measurable outcomes. It’s only a matter of time before enforcement breakdowns riddle the supply chain.
4. Inability to Keep Pace With Modern Customs Technology:
There has been steady development over the last decade in the application of technology to customs requirements. Electronic systems are replacing old customs processes, as automation is becoming a priority for trade authorities worldwide.
Modern programs incorporate various approaches to fulfilling standards, such as advanced e-manifest filings and updated licensing and documentation specifications. Companies are required to change their processes and even switch to entirely different software systems to comply with them.
Is There A Solution?
One way for companies to address these issues is by turning to 3PL’s expertise to help develop a business strategy to address the diverse challenges of international trade and mitigate risk. Partnering with 3PL and using C-TPAT certified customs brokers allows companies to address areas where international trade is lacking.