For new and established businesses alike, the idea of importing or exporting is appealing due to its potential to increase sales and reduce costs. Global interconnectivity has made importing and exporting much more accessible than it once was…but there are still parts of it that can be challenging.
The main obstacle import-export businesses face is the customs clearance process. Due to the constantly changing rules that need to be followed, the various taxes and duties to be paid, and the mounds of paperwork to be submitted, customs proceedings require a certain kind of expertise. That’s why many businesses involved in importing or exporting elect to hire a customs broker.
Of course, there are some businesses who choose to wade through the sea of regulations on their own. Most businesses will decide to invest in a customs broker because they don’t have the time or resources to make sure everything is done properly. It’s usually much simpler to find a customs broker to deal with the customs details so you can focus on growing your revenue and sales.
There’s a long list of benefits to hiring a customs broker, some of which you may not be aware of. Take a look and determine whether it’s worth it for you to hire a customs broker for your business.
What’s the main difference between hiring an accountant to do your taxes and doing it yourself? It’s more convenient to pay the accountant…and more likely that you won’t have any issues with the IRS later on. When you choose to pay someone for a task that you could do yourself (albeit without the relevant expertise), you’re placing a higher value on your time and energy. With the customs process, you can theoretically do everything by yourself, but it will take a lot of time and energy that you probably don’t have.
You might think that the Canada-United States-Mexico Agreement (CUSMA) or other free trade agreements would make going through customs a piece of cake. That’s actually not the case. While these trade agreements certainly make things easier, there are still lots of regulations to follow.
Imagine you’re importing skincare products from Korea to the US. You carefully put together all of the required paperwork, but you accidentally misclassify the goods. Soon, you get hit with a $20,000 fine for committing customs fraud. Yikes! This costly mistake could have been avoided if you had hired a customs broker.
Having a customs broker who is responsible for all things customs significantly lowers the risks. After obtaining import-export insurance, relying on a customs broker is doubtless the safest choice you can make for your company. It’s difficult for a business to bounce back after being charged with fraud and paying the subsequent fines.
International regulations change all the time, and COVID-19 has made things even more unpredictable. Customs brokers are uniquely positioned to stay up-to-date on the latest rules and regulations. They are experts in the field, after all.
If your business is in it for the long haul, a customs broker is a necessity. It’s pointless to spend time and money learning the import regulations for a particular country only to have the rules change the following year. Having a regular customs broker gives your business the adaptability required to operate on a global scale.
Wondering which other situations require a customs broker? Read this.
4. Paperwork assistance
There’s nothing more daunting than staring at a stack of important paperwork you don’t know how to complete. Because documentation is so crucial to the customs process, it’s best handled by experts. Unfortunately, one small mistake could cost you.
When you hire a customs broker, they have your company’s interests in mind. They are ready to advocate for you every step of the way. That’s more than you can say for the average customs officer who doesn’t really care whether your shipments get delayed or not.
5. Cost management
The main reason companies choose not to hire a customs broker is the brokerage fees. That’s a rather shortsighted view of profitability. Don’t think of hiring a customs broker as a cost–consider it an investment in the future of your company.
Beyond helping you avoid costly charges due to customs fraud and other penalties, a customs broker is ideally situated to find the most affordable rates for your shipments and can help you budget properly. This helps you avoid any surprise fees along the way. If you’re importing goods to Canada, your customs broker will often be able to assist you in getting back your Goods and Services Tax (GST) paid on imports.
Imagine the sinking feeling that comes when you realize your shipment is stuck at the border. You receive numerous customer complaints reminding you that you’ve broken your promises to them. You start calling customs several times a day trying to figure out where your goods are and how you can get them back. This nightmare could easily be avoided with a customs broker on board.
Even if you don’t have your goods seized at the border, there’s still the potential for huge delays that can affect your bottom line. The faster your shipments clear customs, the more profitable your business will become. Since customs brokers know the system better than anyone, they can navigate it more quickly and efficiently. They can even access automated customs clearance in some countries.
If you’re ready to hire an experienced customs broker, look no further. At BorderBuddy, our goal is to simplify the customs process for you. We offer solutions for businesses of all sizes, so give us a call today.