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About the Author

Ty Bordner
Vice President, Product Management & Solutions Consulting
Amber Road


Ty Bordner, Vice President of Product Management and Solutions Consulting, has over 18 years’ experience in the GTM software market. He is responsible for product strategy and direction as well as customer and prospect focused solution creation.

Prior to joining Amber Road, Ty spent 10 years with JPMorgan Chase Vastera in various leadership roles, including oversight for Engineering, Solutions Consulting and Product Management. During his tenure he helped manage the company through multiple growth stages from startup, through IPO, to achieving annual revenues in excess of $80M. Prior to joining Vastera, Ty worked for GXS (formerly GE Information Services).

Ty holds a bachelor’s in mathematics from Longwood University and a master’s in computer science from Johns Hopkins University.

For more information, please visit www.amberroad.com
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Supply Chain Comment

By Ty Bordner, Vice President, Product Management & Solutions Consulting, Amber Road

June 20, 2013



Global Trade Strategies with Financial Returns for Retailers

Strategies that Retailers Can Use to Maintain their Competitive Edge


Today retailers face rising transportation costs; increased margin pressure; and greater consumer demand for increased customer service. However, combining low-cost sourcing with global trade best practices can enable retailers to see substantial financial benefits, improved operations and lower compliance risks. Here are a few strategies retailers can use to maintain their competitive edge:

Bordner Says:

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Combining low-cost sourcing with global trade best practices can enable retailers to see substantial financial benefits, improved operations and lower compliance risks.
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  1. Hire individuals trained in global trade management (GTM) and provide them with the right tools for the job. While best practices call for using GTM technology to manage the complexities of global trade, software doesn’t replace the user. With the appropriate people, technology and processes in place, some of the benefits retailers can expect to see include a five to eight percent reduction in transportation costs; 10 to 15 percent reduction in cycle stock inventory; and four to seven days’ compression in order cycle times. 

  2. Recognize that there is no “one-size-fits-all” solution. Look for systems and processes that meet your unique needs, yet don’t require you to reinvent the wheel every time changes occur, which is frequently in global trade, or lock you into a custom solution. Look for automated, flexible solutions that adapt to meet your changing needs and that can take paper-based transactions and turn them into an electronic data flow.

  3. Apply an integrated view of the supply chain to all aspects of GTM, including logistics, supply chain network design and global sourcing decisions. Make sure you are connected to your carriers, 3PLs and other important players in your supply chain for complete visibility in your supply chain. Incorporate your supply chain finance and working capital management considerations into global supplier and customer relationship management and inventory-related decisions.

  4. Centralize your operations. According to an AberdeenGroup global supply chain visibility study, best-in-class retail companies were 50 percent more likely than their competitors to have a centralized global supply chain management organization. These retailers were also twice as likely to have trade compliance management centralized at the enterprise level. Frequently referred to as a “supply chain control tower,” these centers provide visibility and control over everything related to the global movement of goods, creating a dashboard for visibility and supply chain execution.

  5. Take advantage of First Sale. First Sale bases the valuation on what the manufacturer paid for the goods rather than after a middleman’s markup, which is normally used to calculate the Customs duties. Typically First Sale savings within the first five years can be anywhere from 10 to 20 percent on duty.

  6. Leverage a duty management strategy.  This type of strategy can fall in to 3 separate categories – free trade agreements, duty deferral, and duty recovery.  Taking advantage of free trade agreements, like NAFTA, allows importers to greatly reduce their duty burden.  Duty deferral, like an FTZ, allows for delayed payment of duties, and duty recovery programs, like duty drawback, allow and importer to recover the duties paid.

  7. Benchmark your operations. Knowing where you are and where you need to be is vital to improving operations. Operations should be continuously reviewed to identify opportunities for improvements and eliminate deficiencies. Benchmarking also enables you to track your progress over time and change supply chain strategies as needed as well as determine the benefits achieved by the implementation of any improvements.


Applying these strategies and tactics, the same used by best-in-class retailers, can dramatically decrease your overall landed costs and provide your organization greater visibility into your supply chain operations and costs.

 

Agree or Disagree with Our Expert's Perspective? Let Us Know Your Thoughts at the Feedback section below.


Recent Feedback

Glad to see a Longwood alum playing a pivotal role in GTM issues.  We recently introduced a Supply Chain Management endorsement program for undergrads to help enhance workforce development in logistics-related careers.  Hope to help staff SCM 'towers" at major firms.


Dr. Jim Haug
Director, Longwood Logistics Center
Longwood University
Jun, 20 2013

Ty Bodner, I find your article very illuminating. You have given so many of the best practices in one page. Many of these I have applied during my over 30 years career in supply chain and procurement transformation. and each of them has reduced costs by over a million dollars and some many more.

With my experience in Asia, Middle East and North America (US and Canada now for over 20 years) I was really surprised at the lack of knowledge by Sourcing people in these global sourcing and GTM aspects.

I would like to add just a few more sample best practices to be considered for global sourcing (both import and export) at like landed cost valuation. local content optimization for duty reduction, Octroi Duty (taxes for cross state shipments), Factoring cost, Dynamic discounting, Marine Insurance, Payment terms like 2% 20 net 60 and even 180 days in some countries like Middle East, Import and export license costs, supply of high value materials to overseas supplier, etc. 

In fact I am contemplating launching a website of global best practices in each various category which can be a mentoring knowledge base for students and junior professionals in Supply Chain and Procurement to enable them hit the ground running. It may also become a social knowledge database in SC & Procurement by contributions from global experienced professionals who may otherwise just take the best practice ideas with them.


Eugene Fernandez
President
Eugene Fernandez & Associates
Jul, 10 2013
 
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