Why Is Customs Clearance Important in Logistics?
To understand the importance of customs clearance in logistics, it’s best to ensure you fully understand what the term means.
Whether you’re a traveller, importer, or exporter, you must clear customs for your luggage and cargo before they can leave or enter another country.
Thus, the customs clearance process involves determining if your goods are allowed to leave the country, sorting out the related paperwork, and paying any custom fees.
But why is it so important, especially in the shipping industry?
The following paragraphs will explain.
Customs Clearance Process UK
In general, customs clearance is vital for import and export operations. This verification process ensures that the necessary import documents or export paperwork has been properly submitted.
Clearance also verifies that cargo owners and freight forwarders have paid all the required customs duties, VAT costs, and other fees exercised by customs clearance agents. UK customs clearance extra costs may include testing, handling, storage, packaging, etc.
While these things were always important, they’re even more crucial now for the customs clearance process. UK customs are no longer part of the free-trade zone of the European Union.
After the country’s exit from the EU, the UK started operating on an independent customs territory.
Because of this, customs clearance can be completely different and even harder than it was years ago. Customs clearance agents, UK legislation and internal policies can institute additional checks that other jurisdictions may not have.
Such checks and inspections affect both imports and exports.
The new changes make knowing how customs clearance works today more important than ever since the UK’s new customs regulations have different requirements that may be nothing like those in the U.S., Asia, or other European countries.
How Long Does Customs Clearance Take?
Another reason to learn more about customs clearance is to reduce the time it takes to clear customs.
But you should know that reducing the travel time for your cargo depends on several factors.
For example, the destination country or country of origin and type of cargo you are sending are some of the most critical factors.
Another thing that can add more time to the clearance process is the number of parcels that need to be checked. The busier customs clearance agents are, the more it takes to clear your cargo.
But here’s what usually causes the most delays, according to most customs clearance agents. UK agents often have to handle incorrectly filed paperwork.
While these issues do get resolved, your particular cargo is deprioritised in the meantime and can cause significant delays to your shipment.
Other issues include improper customs declarations or cargo descriptions, invalid licenses, and bad markings on the packaging.
So, how long does customs clearance take?
If you can avoid making these mistakes and the agents aren’t too busy, your cargo could clear customs in as little as 24 hours, even faster.
Making mistakes such as improperly filled-out forms can lead to week-long delays in a best-case scenario.
You Need Customs Clearance Services
Whether you’re an importer/exporter or you want to send something overseas, you must understand the difficulties associated with the customs clearance process. UK legislation and the country’s absence from the EU free-trade zone have complicated this aspect of freight forwarding.
That essentially means there’s a higher chance of encountering delays, extra fees, new paperwork requirements, and other issues.
If you can’t properly navigate customs, you risk not getting your product to customers on time, losing profit margins, creating a bad reputation, and having trouble in your business in general.
Using experienced customs clearance services is not only necessary but arguably an industry standard.
Freight forwarders that fulfil international shipments have the logistics infrastructure in place to speed up the clearance process and ensure your cargo can pass to and from the UK.
What’s more, the customs clearance fee is generally included in your freight quote. Therefore, you’re not exactly paying a premium for an upsell.
However, you must ensure that your freight forwarder has sufficient knowledge and expertise to help you clear customs promptly.
What Shipping Companies Can Do for You
As previously mentioned, the customs clearance process involves a combination of paperwork, customs duties, VAT, fees, and inspections.
The benefit of hiring a freight forwarder with international shipping experience is they can give you guidance on what you must do to ensure your cargo will be cleared without delays.
Freight forwarders can explain what fees you can expect and what clearance requirements your cargo must meet in different jurisdictions.
Additionally, the customs clearance fee exercised by freight forwarders can include extra services:
- Filling paperwork on your behalf
- Inspecting the cargo to ensure it conforms with customs regulations
- Advising the best shipping schedule to avoid busy periods
- Packaging or crating the cargo to pass inspection
- Informing you of what documents to prepare and how to fill them
- Offering support with customs declarations
- Ensuring the cargo marking is on point (e.g. for hazardous cargo)
- Managing the customs clearance process in multiple jurisdictions
- Check the correctness of your statements
- Pay duties on your behalf
Of course, each shipment order is different and not every individual or organisation needs the same service package from their freight forwarder.
The scope of your freight forwarder’s responsibilities will be outlined in the contract you sign after agreeing on a specific service.
And given the complexity of customs clearance, especially when moving cargo through different jurisdictions, operating without a freight forwarder can be a logistics nightmare and lead to long but avoidable delays.
The Bottom Line
Why is customs clearance important in logistics? Your ability to clear customs will determine the efficiency of getting your cargo from point A to B.
If you can’t do it quickly, legally, and efficiently, your business operations can slow down, and you may even run into cash flow problems.
Paying a customs clearance fee to a freight forwarder can save you a great deal of trouble, particularly when you have a long-term need to bring or send cargo to other countries.
Establishing a partnership with an international freight forwarder is a smart business decision. Especially when you probably have more things to worry about in your business than keeping up with customs regulations and international logistics.
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