This commentary appeared in the print edition of the Jan. 6, 2020, Journal of Commerce Annual Review and Outlook.
For those managing both international logistics and trade compliance in small to mid-sized firms, the coming year will see challenges stemming from more disparate supply chains. For companies like Fellowes Brands, these challenges are global.
To avoid the US Section 301 tariffs, we are moving sourcing of some key products out of China. This mitigation strategy conflicts with our origin consolidation model, which will lead to increases in both cost and transit time. In the short term, it will have a negative effect on our non-US markets.
Compliance professionals are getting a workout with these strategies as sourcing pushes into GSP countries and supply chains are two or three countries deep. The one-stop shop of China is hard to replicate, and country of origin consideration is more art than science. Getting finished goods vetted can be difficult, time-consuming, and a bit opaque for those not familiar with the regulations. This is methodical work, and the expertise required makes it hard to outsource bits and pieces.
Multicountry sourcing will require further cooperation between logistics providers. Data-driven supply chains should allow even the smallest shipper to hand-select partners for the best results, while still managing to create substantive post shipment reports that reflect the whole supply chain. It is not good enough for a partner to offer visibility only. We are looking for cooperation and commitment to our business.
There are more moving parts in logistics and compliance than there were a year ago. But the logistics professionals I know are enjoying the pace and are up to the challenge!