How understanding customs can improve your supply chain

Can Customs Improve your Supply Chain? We Say Yes, Here’s Why.

 When it comes to reducing overheads and creating cost-efficiencies in your supply chain, the obvious thought would be to look internally. However changing things internally, be it at your warehouse, through your transportation or within your processes can take a very long time, and could cost a fair amount of money. Not to mention, you may not have specific issues with your current supply chain.

Understanding the customs processes and how this plays a part in your supply chain can save you both time and money. Partnering with experts in the industry, such as Inter-Sped, can assist you to improve your customs process and take advantage of every angle to get the most benefit.

First up we are going to take a look at the role of customs in supply chain management, so you can get a good understanding of why it would affect your supply chain.

Understanding the Role of Customs in Supply Chain Management

Customs acts as a Gatekeeper. The authorities at customs control the movement of goods across borders, impacting the flow of imports and exports. Each country has its own regulations, processes, and documentation required before goods can be moved through the border. Understanding these procedures can help businesses avoid delays and ensure compliance, thus maintaining an efficient supply chain.

Some Benefits of Understanding Customs in South Africa

• Less Delays and Quicker Clearance: Undertaking to fully understand South African customs regulations and requirements, allows businesses to ensure that all documentation is accurate and complete ahead of their goods arriving at customs. This will make a huge impact on minimising the risk of delays during customs clearance.
• Cost Savings through Tariff Management: There are standard costs for globally traded products set out through tariff management. Knowledge of tariff classifications and duty rates in South Africa will allow your business to optimise its customs strategy, and potentially reduce your overall expense – by ensuring that you are correctly classifying your goods or making use of trade agreements such as The Southern African Development Community (SADC) Free Trade Area (as an example).
• Enhancing Compliance and Reducing Risk: When you stay in the know, or partner with industry experts (such as Inter-Sped) to inform you on the latest customs regulations within South Africa you will be able to make changes where needed, and potentially reduce loss and/or costs (penalties / fines / seizure of goods). Regulations that could alter include: tariff codes, import/export bans, and safety standards.

As with any country the world over, South Africa has its very own procedures through customs that businesses importing and exporting have to adhere to. Understanding these processes in the South African customs environment will take a large amount of stress off of your supply chain, improve time efficiencies, and reduce costs. Next up, we’ll summarise some of the basics.

Navigating South Africa’s Customs Procedures

• Proper Documentation: There are essential documents such as the Bill of Entry, Commercial Invoice, and Packing List that must be correctly completed to comply with South African Revenue Service (SARS) requirements. Having all of these documents ready, and up to date, will reduce the likelihood of customs inspections or rejections of your goods.
• Understanding Customs Valuation Methods: It’s important to try and prevent disputes or additional costs at customs. Making yourself familiar with the methods used by South African customs clearance teams, to determine the value of goods, goes a long way to ensuring accurate declarations.
• Utilising Electronic Data Interchange (EDI): Technology is your friend! Making use of electronic systems like the SARS eFiling system can streamline the submission of your customs documents, making the clearance process faster and more efficient.

Leveraging Trade Agreements and Preferential Tariffs

International and regional trade is regulated by tariffs and prohibitions. Trade agreements between two countries reduce these barriers and help them to trade with each other. Be fully aware of the trade agreements that South Africa has with other countries to maximise the benefits to your business. These trade agreements may provide preferential tariff rates and streamline customs procedures for you. Two trade agreements that South Africa is a member of include The Southern African Development Community (SADC) Free Trade Area, and The African Continental Free Trade Area (AfCFTA).

Continuous Training and Staying Updated

It’s vital that you are continually educating and training your team on South African customs procedures and the updates thereof. This ensures that your supply chain team is equipped to handle changes effectively, and react in the best time to reduce disruptions and enhance your supply chain resilience.

 Added to this is the monitoring of regulatory changes from SARS. Keeping a close eye on changes here (that could happen at any time) can prevent unexpected delays and the potential of you incurring additional costs. Remaining agile and responsive to market changes places you in the best position to reduce your overheads and risks in the long run.

The Importance of Customs Brokers in South Africa

As experts in the freight forwarding and customs industry ourselves, we understand the need for a customs broker.

• Expert Guidance: Partnering with a knowledgeable customs broker who understands South African customs laws and regulations can significantly simplify the import/export process for your business and help you to navigate complex requirements and avoid costly mistakes.
• Pre-clearance Services: Utilising customs brokers for pre-clearance services can help anticipate potential issues before goods arrive at South African borders, ensuring a smoother and faster customs clearance process.

As you can see, by taking a broad look at the customs process in South Africa and fully understanding all that is involved you can improve your supply chain efficiency, reduce costs, and gain a strategic advantage without changing too much internally.

We’d love to be your preferred partner when it comes to customs, import, export, freight forwarding, distribution and warehousing. Chat to one of our specialists and let’s take your business to new heights.