Mastering the Business of Global Trade : Negotiating Competitive Advantage Contractual Best Practices, Incoterms, and Leveraging Supply Chain Options book cover
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Mastering the Business of Global Trade
Negotiating Competitive Advantage Contractual Best Practices, Incoterms, and Leveraging Supply Chain Options




ISBN 9781466595781
Published February 5, 2014 by CRC Press
405 Pages - 102 B/W Illustrations

 
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Book Description

Much of your company’s success in global trade will be determined by how well you manage contracts and agreements for sale or purchase. Mastering the Business of Global Trade: Negotiating Competitive Advantage Contractual Best Practices, Incoterms, and Leveraging Supply Chain Options explains the key elements any international business person must know, but more importantly, it also describes how to use negotiation skills, leveraged options, and Incoterms to extract the maximum benefits from your supply chain.

At the end of the day, landed costs determine pricing and profits. As such, the book clearly explains how landed cost modeling works and how you can use these business models to leverage supply chain options. Illustrating how Inco terms impact compliance and risk, it details options to help you reduce your exposure to risk as well as best practices to help you steer clear of compliance issues that can cause costly delays.

Managing global supply chains is about constantly striving for efficiency, driving down costs, and increasing profits. With this book, you will not only learn how to negotiate better contracts, but you will also learn how to manage relationships with freight forwarders and customhouse brokers in a manner that will help you get the most value from your service agreements.

The book establishes a very simple, yet comprehensive, roadmap that both the neophyte and the more experienced global supply chain executive can easily follow and master. By following the time-proven advice and roadmap detailed in these pages, you will learn that it is possible to engage in more deals and increase your returns, while reducing your overall risk exposure.

This book is part of  The Global Warrior series.

Table of Contents

The Role of Contracts in Global Trade
Contracts in Global Trade
Case Study: When Contracts (or Lack of) Fail
     Transparency of What Both Parties Are Trying to Accomplish
Trust
Capabilities that Can Be Delivered
Responsible Structure
Managing International Contracts: Best Practices and Necessary Deliverables
Third-Party Options
     Consultants
     Law Firms

Freight, Logistics, and the Global Supply Chain
Freight, Logistics, and the Global Supply Chain
Managing Incoterm Options with Freight Forwarders, Customhouse Brokers, and Transportation Intermediaries
     Advanced Knowledge of Incoterms
     Global Reach through Office or Agency Network for Local Incoterms Knowledge and Applications
     Global Resources to Execute Various Incoterms Options

Incoterms: Foundation of Global Trade
Functional Definition and Use
     Terms of Sale
     Terms of Payment
     How Freight Is Handled
     How Insurance and Risk Are Managed
     When and How Title or Ownership Is Transferred
     How and When Revenue Gets Recognized
     Who Is Responsible for Trade Compliance Issues
     Legal Jurisdiction
     How Disputes Are Settled
     How Company Tax Issues (IRS or Equivalent) Are Mitigated
     Packaging, Marking, and Labeling
     Intellectual Property Rights
What We Need to Know about Incoterms to Obtain Better Commercial Advantages
     Background and History
Incoterm Member Countries
     The UN Convention on Contracts for the International Sale of Goods
     Issues in World Governance
     Governmental Profiles
          World Customs Organization (WCO)
          Organization for the Prohibition of Chemical Weapons (OPCW)
          Convention on International Trade in Endangered Species of Wild Flora and Fauna (CITES)
          Montreal Protocol
          Organisation for Economic Co-operation and Development (OECD)
          Wassenaar Arrangement
The Lacey Act
Nuclear Non-Proliferation Treaty (NPT)
Australian Quarantine and Inspection Service (AQIS) Laws
     Items You Must Declare When Importing or Traveling or Shipping to Australia
Global Governance Guidelines for Incoterms
What We Need to Know about Incoterms 2010
Rules for Any Modes of Transport
Rules for Sea and Inland Waterway Transport
2000 versus 2010
     Placing the Book into Two Sections
     FOB On-Board
     Domestic Use
     Security-Related Clearances and Information Are Addressed
     Terminal Handling Charges Responsibility Clearly Defined
     "Goods Sold in Transit" Transactions Addressed
     Ocean Freight and FOB Responsibilities of Seller and Buyer Redefined
     Cargo Insurance Better Defined
     Specific Incoterms Nuance Changes
Best Practices: Making the Right Choices
     10 Action Steps
     Engage Senior Management
     Establish a Point Person and a Team Approach
     Learn Incoterms and Establish an Incoterms Guru!
     Integrate Incoterms in Every Corner of the Organization
     Partner with Providers
     Plan the Best Options and Leverage Sales and Purchases
     Foreign Inland Freight Can Be a Nondutiable Charge
     Educate Suppliers, Customers, and Vendors
     Do Not Operate in a Vacuum
     Develop and Use Technology Options
     Develop Competitor-Friendly Options; Network
     Networking
     Develop Resources
          Key U.S. and Globally Based Associations
          Global Examples
          Key Periodicals
Senior Management: Executing a Best Practice Strategy
     Incoterms Management
          Develop ITM into Your Business Processes
          Learn the Basics of Incoterms
          Develop Resources for Incoterms Expertise
          Understand How Incoterms Decisions Impact the Global Supply Chain and Break Down Fiefdoms
          Create Integration Management into Incoterms Decision-Making
          Learn Leverage Options in General, and Then Apply to the Specific Scenarios in Your Global Supply Chain Metrics
          Establish Service Provider, Supplier, Vendor, and Other Business Relationship Communications and Standard Operating Procedures
          Integrate Technology into the Incoterms Management Process
          Create Policy Guidelines for Incoterms Options and Trade Compliance Management. For Public Companies, SOX Incoterms Management Is Critical
          Engage Incoterms Lobbying to Increase and Enhance Change to Your Company’s Benefit
Government Security Programs
     C-TPAT and AEO
     United States: C-TPAT
     Europe: AEO
          The AEO Guidelines
     Japan
     Canada Partners in Protection

Landed Cost Modeling
Definition of Landed Costs
Cost to Export from the Originating Country: $$$
Inland Freight from Origin to Outbound Gateway: $$
Foreign Freight from Gateway to Gateway: $$$$
Marine Cargo Insurance: $
Warehousing: $
Inland Freight from Inbound Gateway to the Final Destination: $$$
Customs Clearance: $$
     Required Documents in Mexico
Import Licenses, Permits, and Registrations: $$
Bottom of Form
     Preshipment Inspection
Ancillary Freight Charges, Demurrage, Etc.: $
Duties, Taxes, VAT, or GST, Etc., … $$$$
Government Inspection Requirements $
Handling and Related Services … $$
Case Studies
     Landed Duty Paid: Import Case Study #1
     Landed Cost CIF: Case Study #2
     Reducing Costs: Case Study #3
     Small U.S. Exporter, Changing the Incoterms Choice: Case Study #4
     Chinese Exports to the United States: Case Study #5
     Trade Compliance Issue: Case Study #6
     German Optics Company, the DDP Advantage: Case Study #7

Global Regulation and Compliance Management
Overview
Trade Compliance and Regulation Impact Incoterm Options
     Exports
          U.S. Government Resources for AES
     North American Free Trade Agreement (NAFTA)
          Pedimento Form
United States Foreign Trade Regulations
     Foreign Trade Regulations 15 CFR Part 30, Incoterms, and Routed Transactions
Asia Reviewed
     Importing into China
          General Documents
          Specific Documentary Requirements
Australia
Korea
Europe
     France
Examples of Value-Added Taxes
     Canada, United Kingdom, Australia, New Zealand, Europe
     Canada
     United Kingdom
     Australia
     New Zealand
     Europe
German Export Control
     Objectives of Export Control
     International Export Control Bodies
     Licensing Procedure
Developing Nation: Importing into Nigeria
     Import Guidelines
Latin America
     Brazil
     Mexico
     Argentina
Imports
     Importing into the United States
          Basic Guidelines for Importing into the United States
          Arrival of Goods
          Entry of Goods
          Other Types of Entry
     Customs (CBP) Examination of Goods
Importer’s Security Filing and Incoterms in the United States
Powers of Attorney and Incoterms
     Customs Powers of Attorney
     Revocation of a Power of Attorney
Customs Bonds
     Types of Bonds
     Amount of Bond
     Breach of Bond
Managing INCO Trade Compliance Issues: USPPI and Ultimate Consignee
     USPPI: United States Principal Party In Interest
     Exporter of Record Replaced by U.S. Principal in Interest (USPPI)
     Responsibility of USPPI and Forwarding Agent in a Normal Export Transaction
     Responsibility of USPPI and Forwarding Agent in a Routed Export Transaction
     Ultimate Consignee
Best Practices: Making the Right Choices
     Ten Action Steps
     Senior Management Engaged and Executive Best Practices in Incoterms
     Establish a Point Person and a Team Approach
     Learn Incoterms and Establish an Incoterms Guru
     Integrate Incoterms in Every Corner of the Organization
     Partner with Providers
     Plan the Best Options and Leverage Sales and Purchases
     Foreign Inland Freight Can Be a Non-Dutiable Charge
     Educate Suppliers, Customers, and Vendors!
     Do not operate in a vacuum!
     Develop and Utilize Technology Options!
     Develop competitor friendly options … Network!
     Networking
     Develop Resources
          Key U.S. and Globally Based Associations
          Global Examples
          Key Periodicals

Education, Training, and Skill Set Development
Internal Training Options: Connectivity in Your Company
Senior Management Overview
     Middle Management Oversight
     Operational Level Functionality
     Training Skill Set Agenda

Risk Management and Insurance Controls
Risk Management in the Global Supply Chain: A 10-Step Primer
     Overview
     Ensure Senior Management Commitment
     Establish a Risk Management Focus
     Complete a Global Risk Management Assessment and Benchmarking
     Identify the Three Key Risk Providers
     Profile the Major Areas of Risk and Establish Risk Strategies
     Decide Risk Retentions and Transference Policies
     Identify the Benefits of Loss Control Management
     Establish Trade Compliance Protocols
     Use Technology in Risk Mitigation
     Training Is a Work-in-Process
Risk Management Case Study
     Terms of Sale versus Terms of Payment
     Marine Cargo Insurance and Incoterms
Transfer of Title and Revenue Recognition
     Transfer of Title or Ownership
     Revenue Recognition
          Evidence of Arrangement
          Delivery or Services Rendered
          Price Is Fixed or Determinable
          Collectability Is Reasonably Assured
          Sale of Goods
Incoterms and Sarbanes–Oxley
     Tax Considerations
     Additional Tax Issues
     Ad Valorem
          Value-added (2)
     Supplemental Taxes
     Summary
IPR, Trademarks, Patents, and Other Intellectual Property Rights
     Carnets and Incoterms
     Carnet Use

Bonded Warehouses and Foreign Trade Zones
Bonded Warehouses
     General Provisions in Vietnam for Bonded Warehouses
     India
     United Kingdom
          Definition of a Customs Warehouse
     United States
          What Is a U.S. Customs Bonded Warehouse?
          What Are Its Advantages?
     Mexico
Packing, Marking, and Labeling

Global Supply Chain: Best Practices
Senior Management: Executing a Best Practice Strategy
     Incoterms Management
          Develop ITM into Your Business Processes
          Learn the Basics of Incoterms
          Develop Resources for Incoterms Expertise
          Understand How Incoterms Decisions Impact the Global Supply Chain and Break Down Fiefdoms
          Create Integration Management into Incoterms Decision-Making
          Learn Leverage Options in General, and Then Apply to the Specific Scenarios in Your Global Supply Chain Metrics
          Establish Service Provider, Supplier, Vendor, and Other Business Relationship Communications and Standard Operating Procedures
          Integrate Technology into the Incoterms Management Process
          Create Policy Guidelines for Incoterms Options and Trade Compliance Management. For Public Companies, SOX Incoterms Management Is Critical
          Engage Incoterms Lobbying to Increase and Enhance Change to Your Company’s Benefit
Government Security Programs
     C-TPAT and AEO
     United States: C-TPAT
     Europe: AEO
          The AEO Guidelines
     Japan
     Canada Partners in Protection

Summary
Appendix
     Copyright and Trademark Policy
     Trademarks
     Copyright
     Glossary
     U.S. Trade Terms
     U.S. Free Trade Agreements
          Why Should You Care About Free Trade Agreements (FTAs)?
          What is An FTA Negotiated by the United States?
          What Types of Behaviors Are Addressed in a U.S. FTA?
          With Which Countries Does the United States Have An FTA?
          U.S. FTA Partner Countries
          How Can U.S. Companies Identify Tariffs On Exports to FTA Partner Countries?
     Ultimate Consignee Verification
     Overview
     Objective
     Definition
     Verification Questions as Affirmation of Ultimate Consignee Designation
     U.S. Customs and Border Protection Office of Strategic Trade Regulatory Audit Division Treatment of Ultimate Consignee Transactions in a Focused Assessment
     Introduction
     Background
     Procedures
          Consolidated Entries with Multiple Ultimate Consignees
          Unsolicited Merchandise on Entries Listing a Company as UC
          Entries Initiated by the UC but Another Entity is IOR
     Routed Freight Transactions
          Routed and Non-Routed Export Transactions
     Tax Rates
          EU Countries
          Non-EU Countries
          VAT Registered
Index

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Author(s)

Biography

Thomas A. Cook is a seasoned logistics, international trade and supply chain executive. Tom is the author of more than 300 articles and 12 published books on global trade and related subjects. Tom’s reach into global corporations is deep, with extensive experience in guiding companies on supply chain management and Incoterms. Tom's work is internationally recognized with a global reach spanning six continents.

Tom is Managing Director of Blue Tiger International in New York, a prominent and exclusive management consulting firm specializing in customized supply chain and management solutions. (www.bluetigerintl.com).

Tom’s bestseller, Managing Global Supply Chains (Auerbach2008) … is considered by many to be one of the most comprehensive guides to best practices in global supply chain management in both the academic and commercial world. It’s focus on trade compliance, security and dealing with Terrorism, became the ‘go to’ reference guide for trade practitioners, following the Events of 9/11. Tom is available for inquiries at [email protected] or [email protected].