Global trade plays a pivotal role in a country’s economy. A country’s focus on imports signifies robust local demand and a thriving economy, while a significant export volume creates numerous job opportunities. Thus, to keep the economy stable, it is imperative to maintain a balance between imports and exports, which is heavily influenced by the volume of trade.
The volume of global trade is increasing progressively. As per Global Trade Outlook’s recent report
“The volume of global merchandise trade is predicted to increase by 2.6% in 2024 and 3.3% in 2025, after declining by 1.2% more than anticipated in 2023.”
With the prediction of this massive rise in the number of trades, there come a lot of hurdles and challenges that importers and exporters have to deal with to become successful in the trading world.
When you are well informed about all the customs issues that come across importers and exporters prior to trading, you can make better plans on how to tackle them. In this blog, we will take you through all the common challenges and equip you with simple solutions.
Before delving into the challenges, let’s first examine any modifications in the trading and customs regulations. There exist separate regulations for both imports and exports:
The UK Government introduced a series of changes in the Border Target Operating Model for 2024. These changes are specifically designed for importers of animals, plants, and Food & Feed Systems.
Customs clearance involves ensuring that all imported goods are compliant with the governing rules and regulations. Most traders can find it problematic and complicated, leading to customs clearance delays. Major customs clearance problems are discussed below:
Handling custom documents for imports and exports is a major challenge as it requires keen attention and time to be done accurately.
According to a report by the Federation of Small Business (FSB), “Nearly 10% of small businesses in the UK have come to an end in the previous five years due to complicated customs documents.”
The common documents are the following:
The bill of lading acts as a contract between the carrier and shipper. It provides details about tracking the parcel and confirms that the products are received for the shipment.
The common bill of lading issues are:
The commercial invoice provides information about the goods’ quantity and total value. Moreover, it helps calculate the amount of duty and tax to be paid.
The common commercial invoice issues are:
A packing list is a comprehensive inventory of the shipment that includes the quantities and contents of every package.
The common packing list issues are:
The certificate of origin shows the country in which the goods are produced. It helps to determine whether there are any trade restrictions or if a trade agreement is eligible.
The common certificate of origin issues are:
Customs rules and regulations for importing and exporting countries can change anytime, becoming a nightmare for global traders. Thus, having access to AI-driven customs declaration software that automatically adjusts to any updates is a key to stress-free trading. iCustoms is at the top of the market in this regard, providing you with a sophisticated AI-driven tool, i.e. CDS, to keep you alert of all the fluctuations in customs regulations.
The following are some ways that importers and exporters in international trading face difficulties while responding to new customs laws and regulations:
Unequal information access: Smaller organisations may be at a disadvantage since larger enterprises with specialised compliance teams may adjust more quickly.
Supply chain disruption: Delays caused by adjusting to new regulations may affect delivery timetables and existing supply networks.
It poses a number of difficulties for international traders. The common customs issues are discussed below:
A free Trade Agreement reduces barriers to trade between two or more countries. Under this agreement, goods are sold or bought across borders with little to no hassle.
As an international trader, you must be aware of all the advantages and disadvantages of this agreement.
The common issues of FTAs faced by traders are the following:
Customs duties and taxes are applied to imported and exported goods. Their primary purpose is to protect local industries and generate government revenue. Calculating customs duties and taxes is extremely complicated and requires meticulous attention to avoid errors.
The common custom duty problems faced by importers and exporters are the following:
Transporting goods across borders presents numerous obstacles, particularly customs issues. Nevertheless, by possessing the appropriate knowledge and resources, you can effectively manage the complexities of global commerce. It entails carefully managing documents, remaining up to date on customs rules, meticulously computing customs duties and taxes, and using appropriate tactics for international payments.
With the help of iCustoms, you can confidently handle the complexity of customs. Do not let customs procedures derail your international goals. Reach out to iCustoms right now to start enjoying a more seamless and effective trade experience!
