Data is one of the most important assets any business possesses today. Growing volumes of information can, when utilized correctly, give critical insight into all aspects of how an organization operates to help identify areas for improvement and innovation.
Global trade is no different. This is an area that has always generated a large volume of data, but in the past, much of this was paper-based and difficult to take full advantage of. However, the push towards digitization around the world over recent years presents more opportunities for forward-thinking companies to improve their business intelligence capabilities and, in turn, increase their overall performance.
3 ways good use of data boosts trade
Effective use of data analytics offers numerous advantages for importers and exporters across a range of areas. From direct savings to streamlined shipments, good use of data can help shape strategy and provide a clear competitive advantage in a challenging environment.
Here are three key ways in which analytics supports global trade operations.
Reducing costs
Data analytics can help lower costs by optimizing customs duties and tariff management. For example, analysis of historical import and export data can help firms identify more favorable tariff codes or preferential trade agreements they can take advantage of. This insight ensures businesses pay only what they owe and avoid unnecessary duties, as well as helping make decisions on future supply chain arrangements.
Additionally, analytics can highlight inefficiencies in duty drawback claims or missed FTA benefits, enabling firms to reclaim overpaid taxes and capitalise on incentives designed to reduce costs.
Addressing problem areas
Deeper visibility into customs processes helps firms pinpoint a range of inefficiencies or other issues that can be addressed. For instance, it can highlight common areas where delays or errors occur in activities such as documentation, product classification or tariff calculations. Looking at data like clearance times and rejection rates can identify trends indicating issues, such as misclassified goods or incomplete paperwork.
Firms can use this insight to take corrective action to improve processes. This may include extra training for staff, closer integration with suppliers to improve declaration accuracy or automating key areas such as tariff code classification.
Ensuring compliance
Global trade is a complex, fast-changing environment - and this has been especially true in recent months as rapidly-evolving tariff changes in the US have led to major uncertainty. However, smart data solutions can help reduce risks such as export control failings, exceeding quotas or paying the wrong duty rates, which could otherwise lead to a range of issues, from delays at ports to financial penalties.
How to ensure competitive advantage through data analytics
Having the right data is only the first step. It's vital firms have the right platforms in place to gather, analyze and report on this information in a simple, clear way. A single platform that is able to collect, transform and process data from multiple sources and present the results in a visual format that all employees can understand is vital.
MIC-CUST's business intelligence solutions, for instance, come with a range of charts and dashboards for data analytics, which can be customized to the exact needs of a business if required. Our cloud-based solutions have also been optimized to handle very large data sets, so even the most complex businesses can get fast, clear insight into every aspect of their global operations.