The last thing you want is to end up stuck for days at the border because you don't have all of...
How To Choose a Customs Broker: What To Look For
Planning ahead is the name of the game when it comes to moving goods from A to B. So, how do you go about doing that? Choose your business partners wisely.
Choosing a carrier is one part of the equation, but another important step you may take in your cross-border journey, is choosing a customs broker. A broker's primary role is to serve as an intermediary between the importer and exporter, providing a smooth transition from one party to another. Their role is quite important in cross-border trade, as they ensure the process gets done quickly and legally. A customs broker can be one of the most important decisions you make when it comes to importing and exporting products. Here's what you need to know about finding the right one for you:LICENSED
You will want to make sure, always, that your customs broker is licensed in the region they operate in. This step is not just about being legit, rather a licensed broker is likely to have all the technology needed to obtain legal documents you need for a shipment, including transferal documents like invoices, packing list or permits. This also allows for streamlined communication, and quicker document turnaround. Don't pick a random off Facebook or Craigslist.
A broker with your specific industry experience is likely to handle your freight a lot better, because they know what special care or classification your products would entail. If you are exporting or importing cars, for example, you’d want a broker experienced in this area, as there may be special documentation required, which is beyond just the usual documents for cross-border freight. A broker can have experience in many industries, but one of them should be your industry, for safe measures. A broker should be well versed in tariffs, duties and taxes, for your products.
THE RELATIONSHIP WITH GOVERNMENT AGENCIES
A significant part of cross-border shipping is dealing with customs, which is a government agency in itself. However, there can also be other agencies involved in classification and clearing of specific freight (ie: FDA, Canadian Food Inspection Agency, etc.). Brokers who are well acquainted with these various government agencies can communicate quicker on your behalf, and help ensure your freight gets through legally and without any fines or infractions. Remember, you can face fines or penalties if you have faulty declarations or missing documents, so choosing the right broker to help prevent this, is important.
Always look into references or reviews of the brokers you may be choosing. This will tell you about their reliability, service and legitimacy. Brokerages tend to protect their clients privacy when it comes to posting previous accounts, but you can request a reference from a broker if you are unsure, in order to get insight into how they work. When reading the reviews, you want to look at how communicative and responsive they are, do they get the job done, and any potential errors which may have occurred. Use your own discernment.
You want to look for a broker who provides the services you need. Just because they worked with Joe from down the street, does not mean that the broker will necessarily work for you and your type of shipment. The less hands involved on your freight the less likely mistakes will occur, so having a broker who can take care of most of your concerns, can help avoid some common errors. Some brokers do help with freight forwarding for example, so discuss that ahead of time. Compare rates with other brokers, before choosing one.
Communication. We cannot emphasize enough that a broker should provide you with the communication you need. Usually before you ship, you want to confirm with your broker and make sure you are in alignment...if your broker does not communicate, you are going to encounter delays and high blood pressure. If you need after hours contact, choose a broker who provides that. Choose a broker who is accessible. They should also be able to explain the reasoning behind the duties or taxes you are paying, and provide any clarification you may need.
Make sure that your broker can handle a large volume of goods, if your business entails this. Know your volume and ask ahead of time to make sure they are equipped for your shipment. If you are new to importing/exporting, make sure you discuss that, because some brokers may agree to work with you, but they are not as open with providing support for beginners and thus you may be unaware of some of the steps taking place and it can get confusing.
GET IT IN WRITING
A good step for any individual or business is to protect yourself ahead of time. Before doing business with any company, you should have some type of agreement in place for safety purposes and peace of mind. A broker should not object to this, and it can be a small agreement stipulating the schedule, ports, termination policies, services etc., so that all expectations and roles are laid out. You may hear this referred to as "customs broker agreement".
Knowing what to look for is key when it comes to choosing who to do business with. Some additional questions you may want to ask a brokerage ahead of time are:
- When I call, who can I expect to answer?
- Do you have the capacity to accurately determine the duties, fees or taxes my product is subject to?
- What are your record keeping practices?
- Is there going to be somebody assigned to my specific account? Who?
- Do you offer an in-house audit team to deal with any customs audits?
- What do you require from me?
- What are your company’s areas of expertise?
Remember you need a broker on the side of the border you're sending goods to. So if you are exporting into the U.S. you need a US Broker. If you are in the US and exporting to Canada, you need a Canadian broker. You can read more on the basics of what a custom's broker does, and what they contribute to the import/export process, here.
If you are still shopping for a customs broker, you may benefit from the Zipments broker directory, which contains contact information for brokers across the US and Canada. It can sometimes be difficult to get in touch with brokers, but with the directory you have access to all the data in one space.
Cross-border transport is complicated. Using a customs broker is the easier way to make sure that your shipments are safe and compliant. If you're working with an experienced provider, they can help you streamline your processes, cut costs and make sure you've got the right documentation. Don't let the selection process stress you out, know what you need and be particular with your choices. Your business matters.