Customs Brokers – What do they actually do?
The work of a customs broker can seem rather mysterious because when managed properly, the customs clearance process should be seamless and invisible to you. In an ideal situation, customs clearance of your imported or exported goods should “just happen.”
The truth is, the cross-border clearance of goods that change hands from one party to another can be a complex undertaking that is fraught with potential risk, extended delays and excessive taxes or other unexpected costs.
Customs brokers are responsible for managing the end-to-end process that starts with identifying goods that need to be shipped from one location and finishes with the successful delivery of those goods to a final destination. Brokers handle the paperwork, taxes, shipping details and customs compliance requirements at every step in the process.
The Good, the Bad and the Ugly
You have endless choices available to you when it comes to selecting a customs broker. There are large variances among brokers in terms of cost, technical knowledge and overall competence. Some brokers provide specialty expertise for certain industries or in transporting goods among specific countries. Certain brokers have tightly managed internal controls and well established processes and procedures; others do not.
Perhaps crucially, some customs brokers actively seek to minimise customs clearance lead times but at the potential expense of full compliance. Other brokers lack formal representation in the relevant locations and so rely on informal “arrangements” to get the job done.
In the eyes of the authorities, you are responsible for the decisions made by the broker on your behalf, so it is essential that you can trust the customs broker you choose and that you share common objectives.
Customs Broker Checklist
When interviewing prospective customs brokers to facilitate your importing or exporting activities, be sure to cover the following points:
- Ask the broker what roadblocks are likely to be encountered with your particular customs clearance needs
- Ask how they handled a tricky situation in the past and what creative solutions they were able to implement. For example, what steps do they take when a shipment is stuck at a border entry point behind a backlog of other shipments due to an extreme weather delay?
- Ensure they have 24/7 shipment tracking facility, not just online but on the phone with a real person
- Confirm that they will provide upfront and in writing a complete itemisation of the tariffs that you will be responsible for paying – in other words, total landed cost
- Ask for at least two references that you can personally ring to obtain a first-hand account of how the broker performed for other clients, ideally from your industry. Then ring those clients.
The team at Mawson Global work with a variety of reputable, proven customs brokers every day and are here to help you with your broker selection process. Please contact us if we can answer any questions for you.