According to Bill Todd, Business Development Manager for CargoWise, the technology supplier for logistics service providers, there has been a significant shift recently in the importance of data visibility in the movement of freight. "Increasingly, we are witnessing a dramatic shift in the kind of data requests importers are seeking during the bid process," says Todd. "The movement of data through the global supply chain is now as important as the movement of freight. The focus is shifting from the ability to classify and perform the necessary import data entries to being able to provide accurate import data that traces the importation process back to the origin of the goods."
Todd says that this shift in importers' data requirements has been driven by the sheer increase in the volume of imports over the past 20 years, which means that much of the critical data related to the import process is not available until the shipment clears customs for entry. The result is that not only is the data often incomplete, but frequently contains hidden costs or data stored in different "buckets", making it difficult for the importer to accurately assess the true landed cost of an import shipment.
"The fact is that the software systems of most large importers have no way to gather all of the needed data from their internal systems," commented Todd. "Therefore, they must rely on their freight forwarder and customs broker to provide the critical data they need. As a result of this, along with expanding global supply chains and new reporting regulations, we are seeing a shift to the end-to-end management of data back to the origin of shipment, in addition to the movement of freight in order to remain profitable."
Todd reports that in today's global economy, the current trend in obtaining shipment data is to track the information deeper into the supply chain to gain greater visibility all the way down to the purchase order level and line items in the original P.O.
"Total visibility throughout the supply chain, from the actual site of origin to final destination, is now the ultimate goal," says Todd. "Importers today are increasingly requiring visibility from the time components leave the manufacturer to the time they arrive at final destination. To do so, importers want customized reports from their broker, or the ability to generate their own reports which include many of the data fields in the entry itself. They must rely heavily on the import data obtained from their freight forwarders and customs house brokers to manage the supply chain more effectively and to accurately compare global sourcing points.
"Even in an increasingly challenging business environment, most logistics service providers and customs house brokers can capably move the freight and clear entries. But, as the movement of data has become notably more important than just the movement of shipments, the role of the broker as classification expert has shifted back to the importer of record," says Todd. "Competition throughout the entire supply chain has reduced margins to the point that the difference between the most and least expensive logistics providers has narrowed considerably. In this competitive logistics management atmosphere, the ability to provide total, extended supply chain visibility and customized reporting tools can make the difference in who wins and maintains the business."
Ultimately, it has become more difficult for customs house brokers to survive purely on the entry fee process, which means they have to get more involved in the door-to-door movement of freight. This requires them to rely more heavily on enterprise providers with robust enterprise platforms to provide the necessary visibility of freight data movement to ensure their profitability, summarizes Todd.