• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • REGIONS
    • Asia Pacific
    • Canada
    • China
    • Europe
    • Latin America
    • Middle East/Africa
    • North America
  • BLOG
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » It's Imperative to Master the Three T's of Global Trade Management

It's Imperative to Master the Three T's of Global Trade Management

JanFeb2014_CoverArt_30.gif
March 6, 2014
SupplyChainBrain

News reports have covered Apple's exploitation of tax rules, which have enabled the company to minimise its tax burden. In his testimony before the U.S. Senate last year, Apple CEO Tim Cook was unapologetic, saying that it is simply playing by the rules set by governments. "We don't depend on tax gimmicks ... We don't stash money on some Caribbean island. We don't move our money from our foreign subsidiaries to fund our U.S. business in order to skirt the repatriation tax," he told the committee. Legal details aside, Apple clearly knows how to manage its supply chain in a tax-efficient manner, with a $150bn cash hoard to show for its troubles.

The thing to keep in mind from a supply chain perspective is that exactly where each value-adding step takes place has a big impact on how profitable the operation is in the end. Global sourcing, for instance, as managed out of Luxembourg by Vodafone, has delivered hundreds of millions of dollars in savings through consolidated purchasing, but has also avoided nearly a billion pounds in taxes by taking advantage of transfer pricing rules that legally flow tax losses to its UK unit.

In the area of tariffs or duties, companies like New Balance, which makes a portion of its shoes in the U.S., can legitimately elude part of the 12 percent duty on imported footwear that everybody else has to eat. And, of course, when big investments in new plants are under discussion with state or national governments, any number of preferential terms is up for grabs. Hyundai in Alabama is an example of successfully doing this.

Process and information are both essential to success SCM World field data shows that most companies are still managing the three Ts with a minimum of automation and process rigor around the rules governing global trade. Export compliance, for instance, is handled manually with spreadsheets by 26 percent of the 114 respondents to a recent survey.

Import compliance is little better, with 23 percent relying on spreadsheets. And in the case of free-trade agreement management, 43 percent do the job with no automation or systems of any kind. Given that the rules we're all trying to follow are politically driven and are proliferating as once-poor countries develop some attitude, it should be little surprise that money gets left on the table when manual systems can't keep up.

How would you rate your company's performance in the following areas of global trade management? When asked for self-assessments of performance in global trade, respondents show confidence about sourcing from a lowest total landed cost perspective, but admit that keeping up with details like duties and country-of-origin regulations is a bit more challenging. Better process control and a mechanism for keeping tax, tariff and terms information up to date is needed.

                                                The Outlook

There is money to be made, or at least, money to be saved as 20 percent or more of a product's cost doesn't have to be lost. Going forward, shippers must take advantage not only of effective tax management but of trade management solutions that can help one through the regulatory thicket.

RELATED CONTENT

RELATED VIDEOS

Technology Global Trade Management Transportation Management Business Strategy Alignment Global Supply Chain Management Quality & Metrics
KEYWORDS Business Strategy Alignment denied-party lists export-import regulations Global Supply Chain Management Global Trade Management government compliance Quality & Metrics Supply Chain Analysis & Consulting supply chain management IT supply chain management: global trade management supply chain solutions Technology Transportation Management
  • Related Articles

    Mastering the Complexities of Global Trade

    Three Imperatives for Global eCommerce

    Mastering the Complexities of Global Trade

  • Related Events

    Why IBP May Save Your Supply Chain & How to Run It By This Spring

  • Related Directories

    Kuebix

SupplyChainBrain

100 Great Supply Chain Partners Issue 2009

More from this author

Get regular updates!
Subscribe to our newsletter

Enjoy curated articles directly to your inbox.

Popular Stories

  • 1209_themarketforlogistics

    How an Investment Banker Views the Market for Logistics and Supply-Chain Tech

    Technology
  • 1115_chinarareearthminerals

    Podcast | Can China’s Monopoly on Rare Earth Minerals Be Broken?

    Sourcing/Procurement/SRM
  • 1206_howglobaltradersplan

    Podcast | How Global Traders Can ‘Plan for Crazy’

    Global Trade Management
  • 1210_cultureoffeargripsups

    ‘Culture of Fear’ Grips UPS: Workers Say Injuries Are Underreported

    Logistics
  • 1125_themodernfactory

    The ‘Modern’ Factory Remains a Dream for Many Manufacturers

    Technology

Digital Edition

55746

Subscribe today and receive the latest issue

Start Your Subscription

Case Studies

  • Locus Robotics Helps E-Retailer Deliver During Holiday Peak

  • Manufacturer Slashes Shipping Costs With AI Packaging Solution

  • Apparel Retailer Saves $45 Million With Reverse Logistics Solution

  • QuestaWeb Configures Fragrance Company’s Complex Procedures Into Its Advanced FTZ Software

  • Business Turnaround: Integrated Business Planning as a Management Tool

Visit Our Sponsors

  • More From SCB
    • Featured Content
    • Video Library
    • Think Tank Blog
    • SupplyChainBrain Podcast
    • Whitepapers
    • Webinars
  • The Magazine
    • Digital Issue
    • Subscribe
    • Manage Your Subscription
    • 100 Great Partners Form
  • Resources
    • Newsletters
    • Events Calendar
    • SCB's Great Supply Chain Partners
    • Supplier Directory
    • Case Study Showcase
    • Supply Chain Innovation Awards
  • SCB Corporate
    • Advertise on SCB.COM
    • About Us
    • Privacy Policy
    • Contact Us

All content copyright © 2016 - 2018 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

Design, CMS, Hosting & Web Development :: ePublishing