Executive Summary: Import Operations and Compliance Benchmark Study 2012: The Secrets of Import Success

   American Shipper and BPE Global designed this year’s study to provide readers with a deeper understanding of the trends and issues impacting U.S. import operations and compliance managers.
   In March 2012, 336 qualified respondents participated in a 35- question benchmarking survey covering organizational structure, training, responsibilities, operations processes, costs, technology and other areas related to U.S. imports. Study results are compiled to draw meaningful comparisons within the industry and ultimately call out actionable best practices.
  
Winners. American Shipper research studies aim to highlight actionable best practices by comparing top performers — or “winners”— against the average survey respondent. For this study, winners are only shippers that had 95 percent accuracy in customs filings; 95 percent or better ISF filings for both accuracy and timeliness; and saw costs of $75 or less per filing.
   Survey respondents, representing every major industry involved in importing goods, typically have both customs compliance and operations teams report to a supply chain function, along the same lines as last year’s survey. The study suggests that, despite guidance issued by U.S. Customs, there is little bias when housing these two units under the same division. 
  
Technology. Nearly two-thirds of importers surveyed classified their operations as manual or spreadsheet-based. Even winners are only slightly less likely to rely on manual processes.
   In the area of trade compliance management, most shippers (68 percent) and winners (61 percent) rely solely on manual processes. An overwhelming majority (88 percent) of small shippers rely on manual processes. Companies are also six-times more likely to use spreadsheets for compliance than an automated system. 
   Winners typically get less functionality from technology partners, having a sharper focus on document generation and customs entry management.

Source: American Shipper Import Operations and Compliance Benchmark Study.

Filing & Accuracy. Nearly three-quarters of respondents outsource entry filing, though there are slightly less outsourced filers than in 2011. All in all, it appears that most companies outsource entry filings and do so with a high rate of accuracy.
   Roughly 90 percent of large shippers, 85 percent of midsized shippers, and 75 percent of small shippers report an error rate of 10 percent or less in their entry filings. No company reported an error rate greater than 30 percent.
   Perhaps the most startling find was that roughly 15 percent of small shippers and 5 percent of midsized and large shippers do not audit their customs filings at all. This exposes them to significant risk in terms of fines and delays around classification, origin, and valuation errors from statements made by their brokers or agents. 
  
C-TPAT Participation. The data suggests a correlation between an importer’s security programs and their success in terms of operations and compliance. This may not only be attributed to the “tightening up” of controls in a company, but also because C-TPAT certification mandates partnerships between a compliance/operations function and other functions such as facilities, security, human resources, and shipping in an organization. Winners are considerably more likely to be involved at all levels of the C-TPAT program. 
  
Broker’s Role in Classification. It is a best practice for a company to assume all responsibility for classification rather than outsource to a customs broker or allow brokers to change classification. While most companies assume responsibility for classification, a total of about 15 percent of small shippers, 10 percent of midsized shippers, and 8 percent of large shippers outsource classification completely to a broker or allow other broker intervention in classification, opening them up to significant risk.