10 mistakes in international logistics that destroy business

When an entrepreneur enters the international market, he often perceives logistics as a “technical task.” Move it. Customs clearance. Deliver.

But foreign economic activity (foreign economic activity) - it's not just a chain. It’s setting up the entire business to work in different realities at the same time.

Since 2017, I have been engaged in international logistics and import supplies of equipment and raw materials to Russia. Every year I see big companies making the same mistakes. Not because they're weak. Because they underestimated the depth.

Here are 10 mistakes that most often put a business at a standstill, and in the worst case, can lead to the destruction of the entire company.

I will add to each mistake from myself ways to prevent and prevent trouble.

Delegate the FEA “who will succeed”

Mistake:
Delivery is given to “who is comfortable” – a secretary, a familiar logistician or the cheapest contractor. No risk analysis, no verification of HS codes, no understanding of certification and knowledge of the customs code.

Implications:
- Cargo is on the border.
- Contract breaks down
- Additional charges and fines begin

Decision:
1. Try to build a team that you can trust in life – literally.
Responsible for logistics should not be “on the residual principle”, but a real, specialized specialist with education, spend money, but find such a person in the state if you decide to engage in foreign trade.

2. If you are not ready to take an employee to the staff - find an outsourcing company that has transported and issued hundreds of cargoes. Check ten companies for competencies, request real cases and recommendations of a couple of clients. A decent and honest company will gladly provide you with all the proofs of its activities.

Working on a template

Mistake:
We made the delivery according to one scheme, and now we use it to all countries and goods, without optimizing logistics, creating or using new partnerships and supply chains. Logistics and international trade are not about permanence, they are about daily changes that need to be adapted to. Yesterday Manchuria was opened, and today it is the turn to refocus on Kazakhstan.

Implications:
Overpayment for services, limited resources, legal problems, disruptions, import bans.

Decision:
Each country has its own rules, risks and nuances. And each route has the property of overflowing. The approach should be custom: under the country, under the goods, under the route. Here will help companies that give advice on foreign trade, if you do not have a full-time specialist. But you can easily find the right information, just ask a question.

Ignoring local realities

Mistake:
They did not take into account holidays in China, strikes in Europe, packing rules in the UAE or the period of winter and summer navigation in Russia. No one wants his cargo to arrive in the port of Krasnoyarsk in November, and left the port to Norilsk only in the summer – who will pay for this storage?

Implications:
It's worth it. Customers are angry. Looks like it's unprofessional.

Decision:
Explore the country or hire someone who lives in it. Local realities decide everything. Check the route, call the logistics companies and collect a few options. You can't rely on intuition here. And do not neglect profile channels and chat rooms – there is always up-to-date information.

No plan B.

Mistake:
One partner. One route. One pattern. One payment agent. And then the crisis, the closure of the border or the entry of the agent in the sanctions lists.

Implications:
Stop the entire chain. Production is worth it. The money's hanging. Contracts don't burn, they burn. And no one can solve it. Because there's nothing.

Decision:
Spare routes. Alternative suppliers. Currency hedging.
If you don’t have a plan B, you don’t manage, you hope. You must have at least 5 partners in each of your trades. If one has a crisis or a congestion, you will be able to continue deliveries with the other without loss to your business. And this isn’t about “jumping companies,” it’s about “don’t keep your eggs in one basket.” Companies that can do everything and always are a few out of thousands.

Lack of transparency

Mistake:
The customer asks, “Where is the cargo?” and you don’t know. And they don't tell you where the cargo is, either. They don't pick up. You have to guess and invent on the go.

Implications:
Panic, loss of trust, bad reviews, nerves and damaged reputation.

Decision:
Online tracking, regular updates, clear communication – the rules of cooperation, which should be enshrined in the contract.
Today, information is more important than speed. But in order to receive reliable information on time, a reliable and honest partner is needed again. To find out how to find it, see paragraph 1.

Logistics as a “one department”

Mistake:
They gave it to the logisticians. Lawyers, accountants, IT - do not know what is happening. No one can confirm 0% VAT. There is no one to check the contract with the partner and SVH.

Implications:
Inconsistencies, failures in documents, internal conflicts, tax additional charges.

Decision:
FEA is a team game. Integration of processes, training of all participants is critical. You can hire a coach in a company that will teach the basics of FEA to all participants in the process. To study all the nuances, regulations and requirements of the customs authority before the first delivery is a necessity, not a boring routine.

Loyalty without analysis

Mistake:
We work “out of habit” with a single carrier. Still, it was normal, but recently began to falter...

Implications:
Mistakes in repetition, lack of flexibility, price increases without competition. You find yourself in the “blind zone” and literally put those eggs in one basket. Your partner already feels that they are managing your processes and money, and you don’t have to work well to get new orders from you.

Decision:
Audit contractors once a quarter. Analytics of services offered, speed of work and service for several companies. It's normal. You only need to get the best for your money. International logistics is not cheap and it is dangerous to save money.
Loyalty is good. In business, the main thing is efficiency.

Old knowledge

Mistake:
Employees do not monitor changes in legislation, sanctions risks, new regulations. The company is in an information vacuum, and processes are lame and do not “go”.

Implications:
Error in code → additional accrual
Incorrect Certificate Refusal to Import
Prohibited goods → corner

Customer misinformation means loss of trust.

Decision:
Subscribe to industry updates, study, consult. Set strict rules for working with your partner. Make clear rules of work in your department of foreign trade – who checks the news daily, who sends them to chat rooms, who informs customers. You and your customers need to be aware of what is happening in the morning.
Those who don’t know are in the red.

Documents by eye

Mistake:
The description of the product, the code HS, the country of origin - all "approximately". Documents upon completion of the transaction must be submitted to the tax office. But how to pass if the documents do not know what? CMR and the specification for the cargo is not just a transport bill of lading and packing, these are documents that the customs looks at and they must be executed.

Implications:
Storage on SVC, inspections, confiscations, tax additional charges, again - problems with the client.

Decision:
There should be a clear system of multi-level verification. Regulations, templates, double control. Give your logisticians test tasks to fill out documents. Write checklists on the necessary documents for cargo clearance, let them hang before the eyes of employees. Remember that documents are important, and correct documents are the key to a successful foreign trade deal and the presence of a satisfied client.

I didn't understand INCOTERMS.

Mistake:
I don't know where the area of responsibility is. Who pays? Who bears the risks? Who insures?

Implications:
Legal disputes, missed deadlines, financial losses.

Decision:
INCOTERMS is not a formality. This is the basis of international relations.
Train the team, coordinate with the lawyers, do not “copy from the last time”. Appoint a person responsible for drafting and verifying foreign trade contracts. Make sure that at EXW the supplier does not include the cost of local delivery in the price of goods and other “chips” of international relations. Yes, you can’t remember it the first time, but you just need to have a specialist in the state who has rules bouncing off his teeth or an experienced partner who is responsible for everything and checks everything himself.

Conclusion

International trade, including logistics, is not just the transportation of goods. This is a system in which every little thing is important: from the wording in the contract to the stamps in the CMR. From the internal dimensions of the container to weighing cargo at the border.

The winner is not the one with the most transportation. And the one who thinks three steps ahead and realizes the seriousness of foreign trade.

Expert contact:

Yulia Borisenko, founder of CILCO

Phone:89260280166

Mail:Julia.borisenko@cilco-project.com

TG channel:https://tme/juliaborisenko FEA

Information about the company will be linked to the article.