Monday, 1 August 2016

Going the extra mile - sure about that?

I realized something the other day about this time of year, when companies see their staff taking the bulk of their holidays between Jul and September to take advantage of the school summer break, and leaving departments pretty stretched.

Some would say, well, it's ok because business is quieter in summertime however, from what we see, working in really close partnership with UK importers and exporters, there's still plenty of business activity and of course there's always the urgent customer orders which need to be fulfilled regardless.

And this takes me to the light bulb moment, and how, sometimes, you can underestimate the value you add to customers beyond your core services or offering. In our case, we help companies to reduce their international logistics costs, ensure they're Customs compliant and act as a virtual logistics manager managing the logistics area so they can focus on their core activities.

Although this has happened many times, it suddenly became apparent to me last week, when the contact at one of our USA import customers advised he was taking his summer holiday which would span two weeks. We work very closely with this person day to day and are in the loop on communications with their USA suppliers so we follow each order from when it's placed to when it's finally delivered, measuring and monitoring service levels.

Mark advised me mid-week that he had 4 urgent orders from 4 separate USA suppliers on the go which would all be moving by air freight. These suppliers were in Texas, Tennessee, Illinois and New Hampshire however Mark would be on holiday with cover by a colleague who wasn't that familiar with the mechanics of the US shipments.

When Mark finished on Thursday 28-Jul, the most urgent of the 4 orders, which was needed on Monday 1-Aug was still not packed and the Texas one was just being collected that day. The other 2 were in motion and we knew they were set to arrive on Sunday so they were lined up for Monday delivery.
What we did here was fill the space Mark vacated and communicate directly with the factory in New Hampshire as we knew it absolutely had to be picked up Friday to achieve Monday delivery. At 2100 hours on Friday evening (1600 East Coast US) we got the reply we wanted and made sure the order was then assigned to a direct Saturday evening flight. 

To summarize, what is interesting here is that most freight forwarders work from say 0830-1730 so the UK office of the forwarder (the one who would generally update the client) had finished however they have their own holiday period challenges too, and our usual contact was on holiday on Friday which left another gap so we dealt with another less familiar contact until close of business Friday.
On Saturday morning, we wanted to ensure everything was still on track and checked that both the Texas and New Hampshire shipments were moving as planned, which they were.

So, on Monday morning (today) at 0730 we requested a status update for the customer, and Mark's relief contact came into work with some great news for their own customer, knowing that we had been working behind the scenes over the weekend to make this all happen.

I'm sure that many customers will experience not only the effect of their own departments being stretched, but also their freight forwarder sometimes struggling to maintain the service levels when they themselves are short staffed due to holiday breaks, or other reasons throughout the year, such as sickness, training, maternity or paternity leave.

I suppose the moral here is, if you say you care about customers, demonstrate this in your actions and secondly, don't undervalue what you do for your customers when you go above and beyond your core offering. For me, I don't think I've ever forgotten what I learned about going above and beyond in my days in forwarding operations and how doing something extra can make such a massive difference to a customer. That's why I love what I do.
If you take a look at our testimonials, I think you will be impressed, companies large and small rate us highly and our very first client from 2010 is still on board today. I have also been a panel judge at the Lloyds Global Freight Awards for 2 years so we're known as industry and market experts.
Andy Cliff is an industry professional who launched his own logistics consultancy, Straightforward Consultancy Ltd (SCL) after a 30 year career in international logistics, working for companies such as DB Schenker, Kuehne & Nagel and DHL Global Forwarding in operational, sales and management roles. 
Andy is part of the  judging panel for the 2016 Global Freight Awards, his second year in this prestigious role. The awards recognize quality, innovation and performance in the field of international logistics.  
Andy felt that in an increasingly complex and confusing world of logistics, UK importers and exporters needed a company alongside them which could help them to reduce costs, lessen their workload and provide expert advice and support day-to-day. 

Wednesday, 27 July 2016

Confused about SOLAS and VGM rules for ocean freight shipments - this podcast is worth a listen


Good afternoon All

If you're confused about the new SOLAS/VGM rules which came inti effect on 1st July 2016, the this podcast may be worth a listen. You can also of course take a look at our other blog posts on this topic.

Just a quick blog post whilst I had a moment!

Kind Regards



Andy Cliff


Podcast on VGM

Andy Cliff is an industry professional who launched his own logistics consultancy, Straightforward Consultancy Ltd (SCL) after a 30 year career in international logistics, working for companies such as DB Schenker, Kuehne & Nagel and DHL Global Forwarding in operational, sales and management roles.

Andy is part of the  judging panel for the 2016 Global Freight Awards, his second year in this prestigious role. The awards recognize quality, innovation and performance in the field of international logistics.  
Andy felt that in an increasingly complex and confusing world of logistics, UK importers and exporters needed a company alongside them which could help them to reduce costs, lessen their workload and provide expert advice and support day-to-day. 

Thursday, 14 July 2016

UK importers – post BREXIT, your costs just increased by 13% in a week – it really is time to act


If you are a regular importer, you will no doubt be aware that after the EU referendum vote on 23rd June 2016, the UK pound/Sterling fell sharply on the foreign exchanges from around USD 1.50 on June 23rd to below USD 1.30 and it’s remained at this level for almost 2 weeks, so we can assume that this will be the new level for the foreseeable future. 


Looking further back, one year ago the USD was 1.55 and averaged that level for the whole of July-15. So, we are looking at a cost increase of almost 17% which is significant.

I’ve worked in international trade since 1980 and know that most companies will purchase product from regions like Asia and North America in USD however many don’t realize that the major part of their freight costs are also calculated in USD.

For example, if you import from the USA, the pick up charges, terminal handling, freight rate itself and surcharges such as BAF (fuel surcharge) and LSF (low sulphur fuel surcharge) will all be rated in USD. It's also worth mentioning that if you export by ocean, the freight rate is also rated in USD so another area to investigate.



From our experience over the last 6 years here at Straightforward Consultancy (SCL), we know that companies are sometimes reluctant to review their logistics as it can be time consuming, confusing for a non-expert and they don’t really want to place their supply chain at risk. 

This is why they entrust this work to experts like ourselves who take the lead, involving them to ensure their needs are met when negotiating with freight providers and nothing is left to chance. 

The thing that most customers find surprising is the amount of money they have been wasting (the average we have measured since 2010 is a hefty 35%) and sometimes receiving a pretty mediocre service as well!

What we’re about is not just lowering landed costs for our customers, but using the opportunity to refresh their existing model at the same time, making it lower cost, reliable and Customs compliant. 




We also often find that not only are they paying way more than necessary, but also that their consignments aren’t being correctly declared to HMRC, and we’ve had one customer who recovered almost £ 30,000 of overpaid Customs import duty from HMRC because of our expertise.

So, to summarize, if you have been meaning to look at this area for some time but it’s been on the back burner, it really is time to act. 


Your managing director, financial director and operations director will appreciate your initiative and it will help to offset the squeeze on your company's margins, brought about by the 17% hike in your landed freight costs.

Just to add one more thing, we are very experienced in this area and offer free assessments for customers who are keen to reduce freight and related costs.


We also offer a shared savings/gain share fee model for our work which means our work is results based, includes everything from review to implementation and a full year of freight management, making sure that your costs stay competitive and you have access to expert advice and our knowledge of the logistics marketplace. 

If you take a look at our testimonials, I think you will be impressed, companies large and small rate us highly and our very first client from 2010 is still on board today. I have also been a panel judge at the Lloyds Global Freight Awards for 2 years so we're known as industry and market experts.


So if you're concerned about your rising costs, do get in touch, it may be the best decision you've made in 2016!

Click here to see our story, case studies and customer testimonials




Andy Cliff is an industry professional who launched his own logistics consultancy, Straightforward Consultancy Ltd (SCL) after a 30 year career in international logistics, working for companies such as DB Schenker, Kuehne & Nagel and DHL Global Forwarding in operational, sales and management roles.

Andy is part of the  judging panel for the 2016 Global Freight Awards, his second year in this prestigious role. The awards recognize quality, innovation and performance in the field of international logistics.  

Andy felt that in an increasingly complex and confusing world of logistics, UK importers and exporters needed a company alongside them which could help them to reduce costs, lessen their workload and provide expert advice and support day-to-day. 



Wednesday, 22 June 2016

SOLAS Container Weighing Regulations - VGM - Full Container Ocean Shipments - just 7 days to go - are you ready?

Good afternoon All

Many UK importers and exporters are hopefully aware of the new SOLAS (Safety Of Life At Sea) regulations coming into effect from July 1st 2016 to ensure that container vessels are not overloaded and don't in turn, place lives and vessels at risk.

The new law insists that shippers take legal responsibility for the declaration of a Verified Gross Mass (VGM) either involving them weighing the complete container (Method 1) or their cargo and the empty container weight (Method 2).

Although these changes have been publicized for at least 6 months, it is fair to say that the industry stakeholders in this change (freight forwarders, shipping lines, port operators) have struggled to communicate / collaborate effectively and in some regions such as Asia and the USA, it is very concerning that the industry is either down to the wire or just plain "not ready" and more importantly, freight forwarders seem to have been slow to advise their customers/shippers how to comply with the law and what they need to do from July 1st.

The region of most concern seems to be Asia, where the industry seems only to have woken up to the regulation change in the last 15-30 day, having said that, the USA is also lagging behind.

So why should you as a UK exporter or importer be concerned? Well, if you or your freight forwarder are not ready to comply from July 1st, your containers will be delayed and in turn, your end customers will be affected with missed deadlines or stock shortages..

Here in the UK, the area we see the biggest area of concern is for UK importers, who may think they won't be affected as they don't load containers however they will be affected, as their overseas suppliers will need to comply and what we've seen ourselves is that this really important area has been missed

From our side, we've been monitoring the situation very closely for 3-4 months and have ensured that all of our customers' overseas suppliers have been contacted and are ready to play their part in ensuring a smooth transition.

If you are a UK exporter or importer and you're not aware or don't feel that your freight forwarder is on top of this regulation change, we suggest you get in touch with them urgently and ask for an update on how they intend to ensure that the flow of containers from overseas suppliers or to your international customers will not be disrupted.

If you need any help to ensure either you or your overseas suppliers are ready for the big chamge, please do contact us. We'll also probably find that you're actually paying too much for your freight costs and given that the USD is very strong at the moment, most companies want to try and reduce their landed costs to ensure they preserve their profit margins. We operate gain share / shared savings fee models which are very appealing to customers as they're results based and the customer doesn't have to spend days of their valuable time carrying out this complicated exercise.

Just take a look at our website if you're interested, it may be the best decision you've made in 2016.

Andy Cliff is an industry professional who launched his own logistics consultancy, Straightforward Consultancy Ltd (SCL) after a 30 year career in international logistics, working for companies such as DB Schenker, Kuehne & Nagel and DHL Global Forwarding in operational, sales and management roles.

Andy is part of the  judging panel for the 2016 Global Freight Awards, his second year in this prestigious role. The awards recognize quality, innovation and performance in the field of international logistics.  
Andy felt that in an increasingly complex and confusing world of logistics, UK importers and exporters needed a company alongside them which could help them to reduce costs, lessen their workload and provide expert advice and support day-to-day. 


Monday, 13 June 2016

Straightforward Consultancy - the story in a nutshell...


Good evening All

It's hard to believe that Straightforward Consultancy came to life 6 years ago, following my departure from DHL and a desire to do something very different.

I decided to use my industry experience to help UK importers & exporters to reduce their freight and related costs and with our market knowledge and our network of industry contacts, we could also improve service levels and monitor and manage the freight and Customs side of their business for them and it's been a big success, with some great customer feedback and loyalty.

Even now,  years after the recession first hit, many companies are nervous about the economic outlook for 2016 and their margins are still under, as their costs have risen but their own selling prices have remained flat or have been driven down. The USD has also been very strong for around 6 months (below USD 1.50) which hurts importers in particular.

Many companies would like to review their logistics spend and carrier performance however freight and Customs is justifiably regarded as a complex area and most don't have the time or expertise in house.. To add to that, the sheer number of freight forwarders, services and rate options add to their dilemma, and afraid of making things worse, they stay with their existing freight model, wasting money and missing out on a better service. 

We offer free consultations to interested companies and often uncover potential +30% savings which surprises customers but we know what to look for and the best solution for their needs.

We operate a results-based gain share fee model, leaving clients with nett savings of over 60% so really they have nothing to lose!

We also have a great deal of Customs knowledge, which we've used to great effect, be that supporting a company through a Customs investigation or helping them to recover overpaid duties. We also help customers to dramatically improve their Customs Compliance, so any future Customs visits are no longer something to fear.

When I was asked to judge at the Global Freight Awards last year (and again in 2016) I was surprised and flattered, but I suppose we had been in the media, writing articles and blogs for a couple of years and we had become well known and respected, not just by our customers, but also importantly by the logistics providers that we had worked with and so that was clearly noticed by Lloyds Loading List who run the awards.


If you want to read more about my background, please review my LinkedIn profile or our blog.
Straightforward Consultancy Blog

LinkedIn Profile

Please follow me on Twitter @AndyCliffSCL, visit our website www.straightforwardconsultancy.co.uk  and our blog http://straightforwardconsultancy.blogspot.co.uk/
Andy Cliff is an industry professional who launched his own logistics consultancy, Straightforward Consultancy Ltd (SCL) after a 30 year career in international logistics, working for companies such as DB Schenker, Kuehne & Nagel and DHL Global Forwarding in operational, sales and management roles.
Andy is part of the  judging panel for the 2016 Global Freight Awards, his second year in this prestigious role. The awards recognize quality, innovation and performance in the field of international logistics.  

Andy felt that in an increasingly complex and confusing world of logistics, UK importers and exporters needed a company alongside them which could help them to reduce costs, lessen their workload and provide expert advice and support day-to-day. 

Tuesday, 7 June 2016

Sterling is under pressure due to BREXIT concerns - or is it?

As we watched the evening news yesterday, we were told that the pound fell, apparently linked to the concerns that Britain will leave the EU, so alarm bells were ringing across the City - and people should be worried.

In the spirit of balance and objectivity, can we just hang on a minute here?

We monitor the pound against key currencies each day as we verify freight costs as part of the freight management service for our import and export clients (most freight costs are charged in USD) and frankly I find that headline alarmist and designed to frighten people about what may happen if we leave the EU, regardless of your views.
Please let me provide some facts on Sterling over the last 6 months which you can clearly see below in the concise report we've compiled this morning, logging the exchange rate at 1 month intervals against major currencies, using the Bank Of England database as our source. 
Sterling has been far weaker than it is today, particularly in April 2016, when you can see it was weaker against the USD and the EURO which put this into a more balanced context and it also shows that Sterling is pretty resilient. On 26-Feb it actually fell to USD 1.38, 6 cents below yesterday's level.










The government also tells us that if the pound falls, we will see inflation however despite 6 months of a weak pound, there's no evidence of that in UK inflation figures, and of course a weaker pound gives our UK exporters a vital edge in a really competitive global economy. Again, our government is keen to push exports via the Exporting Is Great initiative via UKTI so can the media and government please stop pushing the Project Fear agenda and report in a much more balanced way.
Please follow me on Twitter @AndyCliffSCL, visit our website www.straightforwardconsultancy.co.uk  and our blog http://straightforwardconsultancy.blogspot.co.uk/
Andy Cliff is an industry professional who launched his own logistics consultancy, Straightforward Consultancy Ltd (SCL) after a 30 year career in international logistics, working for companies such as DB Schenker, Kuehne & Nagel and DHL Global Forwarding in operational, sales and management roles.
Andy is part of the  judging panel for the 2016 Global Freight Awards, his second year in this prestigious role. The awards recognize quality, innovation and performance in the field of international logistics.  

Andy felt that in an increasingly complex and confusing world of logistics, UK importers and exporters needed a company alongside them which could help them to reduce costs, lessen their workload and provide expert advice and support day-to-day. 

Thursday, 21 April 2016

Did you see our article on the Union Customs Code?



Re-issue of our Union Customs Code article from 15th March 2016.


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For those of you who import or export, the Union Customs Code takes effect on 1st May, less than 6 weeks from now and in the spirit of our motto, "logistics simplified" we decided to distill all of the information we'd gathered into a no- nonsense, practical and concise overview and write to all our customers so they were fully abreast of the changes...we also thought it may be useful to the wider supply chain community hence our post today. 

___________________________________________________
You may have heard about the changes taking place on 1st May 2016 with the arrival of the Union Customs Code. You may also have heard the term Authorized Economic Operator being used in the same conversation and naturally, you may then be wondering, what do these terms mean – and how will they affect our business?

As you can imagine, we have been monitoring the developments closely, have attended a dedicated UCC/AEO seminar and have since had written and verbal discussions with one of the leading Customs officers in the UCC team here in the UK.
It’s fair to say that Customs have not been very forthcoming with information on exactly how importers/exporters (referred to as traders by HMRC) will be affected and in fact, the officer we communicated with advised us that they are still to release more detailed guidance on 31st March 2016 (only 1 month prior to the launch date of the UCC!). To be fair to HMRC, the finer points of the UCC were only ratified in late 2015 which prevented them releasing more details.

Firstly, I should explain in more detail what both of the above terms mean.

Union Customs Code

Since the 1990s, within the EU, we have operated under the Community Customs Code, however after almost 10 years of discussion and a failure to agree on the Modernised Customs Code (MCC), the UCC was ratified in 2013 and will bring about the following changes from 1st May 2016:- 
  • More streamlined Customs legislation and procedures
  • Greater legal certainty and uniformity to businesses
  • Increased clarity for customs officials throughout the EU
  • Simplification of Customs rules and procedures to facilitate more efficient customs transactions in line with modern-day needs
  • Complete the move by Customs to a paperless and fully electronic environment
  • Reinforce swifter customs procedures for compliant and trustworthy economic operators (Authorised Economic Operators)
Authorized Economic Operator
AEO is an internationally recognised quality mark which was introduced by the European Commission in 2008 and indicates that a business operates within a secure supply chain and that their internal controls and procedures are efficient and compliant. The Union Customs Code, as you can imagine, is a pretty detailed piece of legislation, and some would say (quite justifiably) that it is quite daunting and confusing, however what most customers really want to know is, should I be concerned about it, and do I need to do anything? Each customer’s situation is different of course but I will try to summarise the situation for the majority of importers below.
Importers
If you are a typical UK importer and you import the goods into Free Circulation – that is, you pay the import duty & VAT when the goods are cleared and either retain the goods within the UK, or you sell them on to UK or EU customers, then you are unlikely to be affected by the UCC unless you operate your own Customs deferment account, where you defer any duties payable at the time of clearance and reimburse Customs once per month.

If you do, the UCC introduces the concept of financial guarantees for most actual and potential Customs debts in the form of the new Customs Comprehensive Guarantee (CCG)- however, as long as you do not make any changes to your deferment account (for example, making changes to the deferment account limit or the bank which guarantees the deferment account, the deferment account won’t be reassessed under the new terms and so you should not be affected.

If you operate any other Customs procedures such as Inward Processing, End Use, Outward Processing, Customs Warehousing, Temporary Admissions or claim 0% Preferential Import Duty, then the new Customs Comprehensive Guarantees will be required.

Let me just put something into context here, as many customers will be feeling a lot of pressure to now become an AEO. With AEO, there are 3 levels of certification, AEOC, AEOS and AEOF however there are presently only 399 AEOs in the UK, as the take up over the past few years has been very poor. Given that almost 50% of these are freight forwarders and there are 220,000 registered UK importers it is clear that the benefits of AEO have not been seen as worthwhile when compared to the time and effort involved in applying and maintaining AEO status. HMRC are also unlikely to be able to even process applications should large numbers of importers/exporters feel they must act however they have seen a rise in applications in the last 3 months.
Exporters

You will notice that I haven’t covered exporters in this summary and this is because, generally speaking, there is much less interest by HMRC generally in exports (as there’s less revenue/duty/VAT attached to exports, and in turn a lesser need for CCGs) and therefore the UCC is likely to have a limited impact on exports. Should you be a user of Inward Processing, then by default, you would be affected as an importer as you would process goods and then re-export and be covered as an importer in this article.
 So to summarise, for the majority of importers.
1. Importing goods to Home Use and do not have their own deferment account
Unless HMRC interfere with clearances for non-AEO companies (which is highly unlikely given that 99.9% of UK importers/exporters are non AEO status), they should see no change to the way their imports are processed however if they use Straightforward Consultancy (SCL) services for Customs compliance, this will be a great asset should they decide to opt for AEO status, as HMRC will want to see evidence of a proper process of Customs compliance, preferably for 3 years
2. Importing goods to Home Use and have their own deferment account
Again, unless HMRC interfere with clearances for non-AEO companies, they should see no change to the way their imports are processed however if they make any changes to their deferment guarantee, they will need to set up a Customs Comprehensive Guarantee (CCG). If they use Straightforward Consultancy (SCL) services for Customs compliance, this will be a great asset should they decide to opt for AEO status, as HMRC will want to see evidence of a proper process of Customs compliance, preferably for 3 years. Customs are also saying that if a customer becomes an AEO, they will benefit from a 70% reduction in the guarantee amount.
nb - If you operate SIVA (Simplified Import VAT Accounting), where you use this system to reduce the amount of the guarantee you have lodged with HMRC (just to cover the duty) then you can continue to use SIVA in its current guise until your term expires.
3. Importing goods to other Customs regimes, such as Inward Processing, End Use, Outward Processing, Customs Warehousing, Temporary Admissions or claim 0% Preferential Import Duty 
The arrival of the UCC will definitely affect you, as the new Customs Comprehensive Guarantees will be required and for example, if you already have an IP Undertaking which is due to expire after 1st May 2016, then this will be valid until expiry unless you make any changes to it.
 I hope that this has been useful and gives you a pretty concise overview on what is happening with the Union Customs Code, and more importantly, how it may affect you. Of course, this is a concise summary and reflects our personal opinion of the changes and far more detail sits within the Customs notices and, we hope, within the update on 31st March. I also attach a link to the last official update from HMRC in October 2015.
Please do contact me if you require any guidance or clarification.
 Please follow me on Twitter @AndyCliffSCL, visit our website www.straightforwardconsultancy.co.uk  and our blog http://straightforwardconsultancy.blogspot.co.uk/
Andy Cliff is an industry professional who launched his own logistics consultancy, Straightforward Consultancy Ltd (SCL) after a 30 year career in international logistics, working for companies such as DB Schenker, Kuehne & Nagel and DHL Global Forwarding in operational, sales and management roles. 
Andy felt that in an increasingly complex and confusing world of logistics, small-medium sized UK importers and exporters needed a company alongside them which could help them to reduce costs, lessen their workload and provide expert advice and support day-to-day. 



Andy is part of the judging panel for the 2016 Global Freight Awards, his second year in this prestigious role. The awards recognize quality, innovation and performance in the field of international logistics.