“What we see on a daily basis is the companies that understand that automation and more efficient processes which ultimately save money and produce better accuracy—those are the companies that are going to be more open and will fight for the necessary budget to secure automation,” he continued. “Most products out there have a compilation of other components which more often than not, come from various other countries—and that’s where you need that management solution,” said Hardenburgh.
Although electronic document management is not a new concept, it is one that continues to gain ground as more companies expand their global business footprint—such as UPS which launched freight services between the U.S. and Mexico and even more recently, into Nicaragua and Honduras [the latter which was made possible as a result of the 2006 Dominican Republic-Central America-U.S. Free Trade Agreement (CAFTA-DR)]. Its UPS CrossBorder Connect service is one way the company is alleviating freight supply chain challenges between U.S. and Mexico for companies investing in cross-border trade.
The concept of such unique portals as VUCEM is being readily accepted throughout Latin America, said Solorzano, and such electronic documentation portals continue to serve as the next step in effective FTA management. “That is definitely the way that you will need to do business to digitize everything that is under FTAs,” he added.
In a global economy where one transaction affects another and businesses are no longer operating under just one FTA, Irmen agreed that businesses will continue to adapt to more efficient, digitized processes.
“After businesses make their sourcing decisions, they’re looking for a tool that with one push of a button is going to do their BOM analyses against multiple FTAs,” she confirmed. “They’re no longer just operating under NAFTA—companies in one central location are doing qualifications for their companies around the globe. They need to be able to do that very quickly and efficiently—and that takes automation,” said Irmen.
Export compliance is not an option
As free trade agreement initiatives continue—with most recent trade negotiations around the Trans-Pacific Partnership (TPP)—businesses must factor in how such developments will impact their cross-border processes such as maintaining rules of origin for FTAs; upholding valid certificates; and ensuring that their BOMs meet qualifications to claim preferential duty.
“We see quite often where companies have zero automation in place and if you think about everything that is involved with an import process—without automation, it can be next to impossible to cover that,” Hardenburgh concluded.