Review: International Trade

Viviane Simond, Express Trade Capital

The international market is in a particularly remarkable state of flux due to a wide range of contributing factors. Between the effects of climate change, political upheaval, and shifting consumer habits, the future of international trade has seldom been so uncertain.

Climate change may prove to be the most pervasive influence on the international market at large. Recent studies predict that climate change will generate violent storms and intense flooding that could damage ports, railways, roads, and harvests in high-traffic areas. Our ever-increasing reliance on global trade routes compounds the difficulties governments face in their attempts to manage the effects of climate change. This combined effect of growing demand and dwindling supply threatens to create raw material shortages and unexpected price hikes.

Climate change causes harvests to be more variable, which threatens the reliability and integrity of the infrastructure on which international trade depends. There are fourteen major choke points around the world (including the US Rail Network, Panama, Suez-Canal, etc.) that are vital to adequate distribution of food supplies. The US, Brazil, and Black Sea collectively account for about 53% of global exports including dietary staples like wheat, rice, maize, and soybeans. Any major obstructions to one or more of these choke points could lead to a supply shortage and price spiking. These issues may risk systemic stability and human security in the world’s most insecure and politically unpredictable regions if governments don’t devote significant resources to solutions. Thirteen choke points have been subject to closure or significant traffic restriction over the past 15 years.

Terrorism, even just one instance in one location, can hinder international trade throughout an entire region. Attacks also affect long term economic activity, since trade is typically condensed for about five years after an attack takes place. Counter-terrorism efforts delay shipments, which hurts vendors, buyers and shippers alike. As a result, transactions take significantly longer. Food products become much more susceptible to shipping delays and supply chains are disrupted due to tighter border regulations. Unfortunately, these delays can be extremely expensive.

In the wake of terrorist attacks, airport security surcharges and insurance premium rates increase, as do shipping and customs requirements, which cause delays and increased trading costs across the board. Unfortunately, non-tariff barriers established in the name of counter-terrorism, like restrictive outsourcing policies, often tend to protect certain industries more effectively than they do individuals. Unrestricted trade enables nations to work together and fuels economic prosperity and development. By reducing trade, counter terrorism policies inadvertently drive a wedge between trading nations and hurt their economies. Consequently, countries that lose money due to trade restrictions are less able to combat terrorism.

Brexit will likely have a massive effect on international trade patterns, depending on how British Parliament implements it. Since immigration concerns were among the primary driving forces behind the Brexit vote, the UK is likely to lose a significant portion of its migrant workforce. This will likely put a damper on productivity, economic growth, and job opportunities. Furthermore Scotland, which voted overwhelmingly to remain in the EU, intends to hold an independence referendum in response to the economic difficulty it will probably suffer as a result of Brexit. This proposed “Scexit” would alter the UK’s political character and potentially increase the rift between the UK and the EU.

During the Brexit proceedings, the UK will have to renegotiate legal framework for their trade relationship with the EU as an outsider. In the process, the EU will probably implement tariffs on UK-produced goods in an attempt to balance the scales. As of now, the UK is still a part of the EU, so British companies can trade with the EU on a tariff and quota free basis. There are rumblings of intimidation tactics between EU countries and the UK, including a possible automotive trade war between the UK and Belgium. Fortunately for the UK, their trade relationship with the US will not be affected. However, when Brexit is fully in place, Europe and the UK’s relationship as well as their trade agreements will probably be quite different.

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Debt Finance vs. Equity Finance

Ross Bienstock, Express Trade Capital

When business owners need cash flow, they have access to a variety of financing resources, most of which fit into one of two categories: debt and equity. Although both are equally useful in different contexts, there are advantages and disadvantages to choosing one funding method over the other.

What is “debt finance”?

Debt finance is simply borrowed money that will be paid back, plus interest. Common examples of debt financing include credit card charges and car and home purchases. There are several advantages to debt financing when compared with equity financing, first of which is that once the borrower pays the lender back, their relationship is over. Debt finance is also advantageous because it is easy for the borrower to predict their expenses since loan payments are consistent in amount and frequency. Since the lender does not have any equity in the business (meaning they don’t own any portion of the business), it does not decrease the owner’s interest in the company. Another advantage is that the company can off write interest paid on debt finance on their tax return, decreasing the effective cost to the company.

There are also drawbacks to using debt financing for your business. Using debt financing indicates that the entity borrowing the funds is extremely confident in their ability to pay them back. While it is obviously advantageous to be confident in one’s ability to repay debts, this arrangement leaves one with little recourse if unexpected difficulties affect their cash flow. The borrowing business may fall on hard times and end up with insufficient cash flow to pay its debts.

It is also important to be aware that the greater a business’s debt-equity ratio is, the riskier the company is going to be. Meaning if the amount of funds a business has borrowed approaches or surpasses the value of that business’s assets, it becomes harder for that business to seek out funding. This is a red flag to lenders and often means they won’t get involved with the business in question. As a result, debt finance can hinder the business’s progress and stunt growth.

What is “equity finance”?

If you have ever watched Shark Tank on TV, you have some idea of what equity is. The premise of the show is angel investors deciding whether or not to purchase equity in someone else’s business idea. Equity refers to ownership of shares of a company. Equity financing is different from debt financing because the funds come from investors, rather than lenders. As mentioned, once the borrowing business pays the lender back in a debt financing transaction, their relationship is over. With equity financing, however, the investor remains involved as part-owner of the business.

The biggest advantage to using equity financing is probably that if the business fails, the primary business owner doesn’t need to repay the investor. That may sound insignificant, but the fear of lingering debts after the business dissolves is all too prevalent for many small business owners. This method also leaves more cash flow available since it doesn’t create expenses.

The major disadvantage is also the most obvious. To acquire the equity funding, the business owner must relinquish a percentage of the business to the investor. Any time the business makes a profit or the owner needs to make a crucial business decision, they will have to consult the other partner(s).

Which is best for you?

Does debt financing or equity financing better suit your situation?  It all depends on where your business currently stands and who you know. If you and your business are quite new to the market, you may want to borrow traditionally to avoid giving up equity. If you have a close friend or trusted family member who might be willing to invest, you may be more interested in sharing equity with them to avoid accruing debt. No matter how you choose to finance your business, make sure you know the benefits and drawbacks of each option and carefully plan to avoid unforeseen difficulty.

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Negotiating Payment Terms

Sadie Keljikian, Express Trade Capital

As a wholesaler, negotiating payment terms with your retail customers can be complex and lead to friction. Fortunately, most retailers are reasonable and will work with their vendors to find a compromise. Furthermore, there are ways to work around an insistent customer who refuses to yield to their vendors’ needs.

Where do I begin?

Depending on the customer, a variety of factors can affect the agreed payment terms. First and foremost, it’s important to understand the power you have as a wholesaler and the power your customer has as a retailer. Since retailers are the customers in this arrangement, they usually get the most consideration. Big-box retailers are particularly aware of how much value they hold as customers, since they typically have good credit and place the largest orders their vendors receive. Thus, large scale retailers often seek the best, or longest, payment terms (N90 or more), since most of their vendors are willing to accommodate them.

As a wholesaler, you too have power in the equation, particularly if your product sells well. The more unique and/or popular your product, the more retailers will want it in their stores and thus the more willing they will be to meet your needs.

It is important to bear in mind that, although payment terms are negotiated at the onset of the wholesaler-retailer relationship, larger scale retailers usually don’t use long-term contracts. Instead, individual purchase orders serve as contracts.

What if my customer or I need to adjust terms?

Typically, if either a customer or a wholesaler needs to alter the agreed upon payment terms, it prompts another round of negotiations. If a long-term contract is in place, unilateral adjustments of payment terms are legally prohibited and can result in a lawsuit, so a new agreement must be reached between the two parties.

Sometimes, big retailers (who, as mentioned, typically do not enter long-term contracts with their vendors) will change their policy and formally announce that all future purchase orders will be under new payment terms. If you find yourself unable to agree to those terms due to cash flow concerns, you have a few options.

What are my options when my customer wants better payment terms than I can reasonably offer?

  • Negotiate again. – Although big retailers typically prioritize their own business interests, they will sometimes make exceptions for valued vendors. This is where your worth and power as a vendor comes in, because if your customers care enough about keeping your products in their stores, they may be willing to come to an agreement.
  • Turn down the order. – If your customer is asking too much and won’t negotiate to meet your needs, you can always turn down that customer’s purchase orders. This may hurt your revenues, since the customers who typically ask for extensive payment terms are the ones who will place consistent, large orders. But again, if you aren’t under a long-term contract, you are under no obligation to fulfill every purchase order.
  • Factor your receivables. – If you can’t wait as long for payment as your customers want you to, but don’t want to lose business, you can factor your receivables. In a factoring agreement, a lender will advance you most of the value of your fulfilled invoices, then collect on the invoices from your customers. In other words, in exchange for a small percentage of your invoice values, you will receive payment immediately and no longer need to worry about collecting from your customers.
  • Finance the purchase orders. – purchase order financing, or “PO funding.” PO funding is an arrangement whereby a financial institution pays manufacturing and shipping costs for wholesalers against confirmed purchase orders. It’s a nearly perfect system for situations like this, since the customers with the most leverage (i.e. the ones that request better payment terms) are usually credit worthy.

Although the lack of an overarching agreement can make payment terms seem a bit murky, the longer your relationship with your customers and the more customers you have, the more you will be able to gain leverage and do business the way you want to. Know your rights and options and you will be prepared to manage any customer, regardless of their preferred terms.

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West Coast Longshore Contract Extension

Sadie Keljikian, Express Trade Capital

Longshore workers from 29 ports across the west coast have voted to determine whether to extend the collective bargaining agreement they share with the Pacific Maritime Association, or PMA, for an additional three years. Early reporting on the ballot suggests that the extension will pass with 67% of votes, but the union’s Coast Balloting Committee will announce official results on August 4th. The agreement was scheduled to expire on July 1, 2019, but assuming the extension passes, it will be in effect through July 1, 2022.

The International Longshore and Warehouse Union (ILWU) voted on the unprecedented extension proposal after a year of debating and democratic process, allowing all registered longshore workers from Bellingham, WA to San Diego, CA to vote. The extension promises to raise wages, solidify health benefits and increase pensions.

ILWU International President Robert McEllrath said “The ILWU was founded on principles of democracy, and the rank-and-file always have the last word on their contracts. There was no shortage of differing views during the year-long debate leading up to this vote, and members didn’t take this step lightly. In the end, the members made the final decision to extend the contract for three years.”

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Decoding Invoice Terms

Sam Permutt, Express Trade Capital

Making sense of the various terms contained in invoices can be frustrating. Plus, terms are getting trickier and more involved as big customers continue to strategically extend their payment terms and interrupt cash flows for smaller businesses (in turn creating a greater need for factoring). When negotiating a purchase order or contract, it is essential to know what payment terms are, what they mean, and what options exist.

To help make sense of the most used invoice terms, here’s a helpful cheat-sheet:

Net due upon receipt of goods (or n/ROG)

If the terms are net due upon receipt of goods (or nROG, or n/ROG — “n” standing for “net”), the invoice amount is due when the customer receives the goods. Note that the date of “receipt” is up to the customer receiving the goods; goods can remain in a shipping container, for example, before the vendor decides to “receive” the goods. However, if the terms are Net 30 ROG, that means payment is due 30 days after the receipt of goods.

Net 30 days

Payment terms that require a simple count of days after the date of the invoice (e.g. N30, N60, N90, etc.) are the most common terms used between wholesale vendors and their retail customers. Luckily, they are also straightforward and easy to understand.

When an invoice states net 30 days (typically written as “N30”) the invoice amount is due 30 days from the date of the invoice. For example, if an invoice for $1,000 is dated July 1 and the terms are net 30, you need to pay $1,000 by August 1 or else additional fees or interest may apply. If the terms are net 60, the payment is due on September 1st (i.e. 60 days after the invoice date). For net 90, payment is due on October 1st (i.e. 90 after the invoice date), and so on.

1/10 Net 30

When an invoice includes the terms 1/10, n/30, the “1” represents 1% of the amount owed, the “10” represents 10 days and the “30” represents 30 days. According to the terms 1/10, n/30, you may take an early payment discount of 1% of the amount owed if the amount owed is paid within 10 days instead of the normal 30 days. In other words, you can pay within 10 days and deduct 1% from the invoice amount or pay the full amount in 30 days.

2/10 Net 30

Just like 1/10 Net 30, with terms of 2/10, n/30, the “2” represents 2%, the “10” represents 10 days, and the “30” represents 30 days. This means that the customer can take an early payment discount of 2% of the amount owed if payment is made within 10 days. In this scenario, the customer can choose either of the following: pay within 10 days and deduct 2% from the invoice amount, or pay the full amount in 30 days with no discount.

5/10, 2/30, Net 60

Under these payment terms, the customer gets a 5% discount if they pay within 10 days or a 2% discount if they pay within 11-30 days. Otherwise, full payment is due within 60 days of the invoice date.

Net 30 EOM

“EOM” stands for End of the Month. This means that the invoice is due and payable 30 days after the end of the month in which the goods were delivered. For instance, if the goods were delivered on July 15, payment is due 30 days after the last day in July.

Some account debtors (i.e. the buyers who owe payment on a given invoice) set cutoff dates whereby they consider all goods shipped after a certain date as if those goods were shipped the following month. For example, if the cutoff date is July 20th, and goods are shipped on July 21st, the buyer might start counting net 30 days after the end of July.

Net 10 EOM 30

Per industry practice, when an invoice is dated after the 20th of the month, the clock begins to run on the first day of the following month rather than at the end of the month in which the goods were shipped.

Therefore, if the invoice is dated July 25, the count starts 10 days after the month ends (thus August 10th) plus another the buyer has another 30 days to pay, meaning that the full amount is due on September 10th.

By contrast, if the invoice is dated July 19 – i.e., before the 20th of the month – the count starts 10 days from the invoice date of July 19th (thus July 29th) plus 30 days, meaning the full amount is due on August 29th.

*The party who is obligated to pay the invoice is referred to interchangeably as the “customer(s)”, the “buyer(s)”, the “retailer(s)” or the “account debtor(s)”.

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Why Use Purchase Order Financing?

Sadie Keljikian, Express Trade Capital

What is purchase order financing?

Purchase order financing is a trade finance solution designed to help businesses finance the production and shipping costs required to fulfill their customers’ purchase orders. This allows companies, typically wholesalers who import or export goods, to grow without selling equity or exhaustively increasing their bank lines.

In a purchase order financing arrangement, a financial institution pays for the cost of goods and shipping (or a substantial portion of that cost). Effectively, the payment is then a loan. Although a purchase order is not an asset, purchase order funders use creative means to secure their loan: in addition to filing a blanket lien on the borrower company, funders collateralize their loan with inventory which corresponds directly with the goods being provided by the supplier (and purchased by the financier on behalf of their client).

Why not just take out a traditional loan?

While purchase order financing, often called PO funding, is a remarkably useful tool for importers, exporters, and wholesalers across industries, it is also one of the least understood varieties of trade finance. As a result, businesses often don’t know it even exists and therefore miss the opportunity to fund their operations and maintain sufficient cash flow without accruing considerable debt. They usually agree to burdensome loan obligations, or relinquishing equity instead.

Many companies sign up for products that have a strong online presence or are otherwise easy to understand but are not ideal solutions. For example, SBA loans are very popular and inexpensive but they are also typically small, inflexible and take many months to get approved, whereas PO funding has none of those roadblocks. Alternatively, a lot of companies also take on high interest merchant cash advance loans (or MCAs) because they have invested a lot in marketing. MCAs are easy to understand, have quick and easy application processes and they employ aggressive sales tactics. However, PO funding offers more flexibility and greater loan amounts at a fraction of the cost.

Is purchase order financing right for me?

PO funding is helpful for companies who need capital to keep pace with their rapid growth or whose credit histories are insufficient to obtain traditional bank lines for operational capital. Unlike banks and traditional lenders, the purchase order funder underwrites the transaction rather than the credit of the business seeking the loan. Therefore, PO funders look to the credit of the final customer (usually a retailer) in addition to that of the wholesaler. By underwriting the transaction, the PO funder is free to look at the underlying purchase order and overall transaction structure rather than solely looking to the financials of the borrower.

In general, PO financing best suits suppliers with at least a few customers who place large orders. Having big-box customers is advantageous because they often have good credit, so your funding requests are more likely to be approved and financing costs will probably be lower.

Aside from credit requirements, purchase order funders look at many other aspects of the transaction. Purchase orders should have a minimum profit margin of 20% to provide enough cushion to cover the extra cost of PO funding. Purchase orders should also be non-cancelable. Due to wishful thinking or simple oversight, companies often overlook contingencies in purchase orders and might not realize that an order is actually on consignment, which allows the customer to return whatever goods do not sell. The purchase order can also call for partial consignment, unreasonably long terms, or any number of other onerous terms and conditions. PO funders are adept at reading purchase orders and helping their clients understand and structure their transactions more efficiently.

How are PO financing rates determined?

PO financing rates are proportionally based on utilized funds, meaning the amount that the finance company pays to the client’s supplier. Once the lender confirms the utilized funds, they use the supplier and the customer’s credit to determine risk. Like most traditional loan agreements, the bigger the volume, the lower the rates. Also, the greater the risk, the higher the rates.

Purchase order financing rates vary between lenders and locations, but on average, they are determined using a similar formula:

(a) Deal Fee – The funder will charge a “deal fee” or “facility fee” to do the transaction. The fee is usually 1-3% of the loan amount requested and covers service costs (i.e. processing and administrative costs).

(b) Interest – PO funders will then charge interest on the loan amount until the client pays it back. A typical PO funding interest rate is 2-3% for the first 30 days, and around 1% per 10 days after the initial 30. This is subject to change based on the creditworthiness of the client and/or that of their customer, and the risk involved in any given transaction.

How does PO funding relate to factoring?

While factoring and PO funding are different varieties of lending, they often work in tandem. When a wholesaler enters an ongoing factoring agreement, they receive funding against their invoices, which retailers repay (barring any issues). When factoring and PO funding are utilized in conjunction, funds lent against purchase orders can translate to an advance (or portion thereof) against invoices. In other words, the wholesaler no longer needs to repay the financial institution that provided funding against their purchase orders. The financial institution is then reimbursed when they collect from customers on the factored invoices.

How do I start?

If you plan to seek funding against your purchase orders, prepare yourself as best you can. Investigate your customers’ creditworthiness to whatever extent you can. If you and your customers have good credit, your lender will most likely approve your request and offer you competitive rates.

At the end of the day, the specific details of purchase order financing agreements vary from lender to lender and from one client to the next. Risk analysis is not an exact science, but if you find yourself short on operational funds and have reliable, creditworthy customers, purchase order financing can simplify your sales process and day-to-day finances significantly.

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Unclouding the Future of Manufacturing

Sadie Keljikian, Express Trade Capital

Job creation, especially in the manufacturing industry, is a hot topic in the US right now. Since last year’s presidential campaign, there’s been an ongoing debate among politicians, business owners, and news outlets about the future of domestic manufacturing. President Trump has blamed the uptick in outsourced labor and consequent job losses on NAFTA, calling it the “worst trade deal” in American history. However, numerous sources argue that technology and automation are the real culprits.

Several sources claim that machines (not outsourcing) are responsible for about 85% of US manufacturing jobs lost since 2000. Even so, many American-run companies are bringing domestic manufacturing back in anticipation of potential legal and regulatory changes emanating from the tumultuous Trump administration, like the proposed border adjustment tax. With advances in automation spanning every industry, even farming, and robotic technology becoming more affordable, it is hard to imagine that there are as many potential jobs in domestic manufacturing as voters have been led to believe. It’s easier for candidates to make vague promises than to explain the more complex and subtle truth. Thus, politicians have been stoking voters with pledges to bring back a golden age of employment that no longer exits and is no longer feasible.

Businesses are taking different approaches in their attempts to create jobs. Some are bringing manufacturing back to the US, banking on the cache of goods labeled “made in the USA” and on US consumers to support domestic businesses by purchasing them, even at a premium compared to their imported counterparts. However, since automation has taken over so many manufacturing processes, it is unclear whether it is a viable long-term solution for employment. Others are attempting to create new jobs by consolidating the retail experience. With recent difficulty in the retail industry, particularly among stores commonly found in malls, some retailers, like Walmart, are creating a mall-like experience within their stores. Many Walmart locations now include services like eye care, dining, and salons, which keep customers in the store by providing them with services they already need.

Other sources claim that there is a serious opportunity for job creation inherent in the current rise of e-commerce. As online shopping continues to grow in popularity, retailers who focus on e-commerce are hiring new sales staff at impressive rates. What’s more, comparable jobs in e-commerce have better salaries, paid leave, stock benefits, and insurance than similar positions in their brick and mortar counterparts. Unfortunately, however, these jobs are highly concentrated in major metropolitan areas, so they don’t reach most of the geographical US.

Some experts are still holding out hope for traditional US manufacturing jobs, just not in mass-produced products. In recent years, the US has seen a rise in domestic manufacturing of custom or handmade products. While these products will never reach mass-production volumes, they appeal to the conscientious shopper who is less concerned with cost than they are with knowing where their money is going. These businesses usually use eco-friendly, fairly traded raw materials and typically work on a much smaller scale, in terms of both space and workforce. Since the products are more expensive to make, they naturally cost more for consumers. However, marketing and sales of such products typically target consumers who are willing to pay the extra cost of purchasing ethically sourced goods, so low volumes aren’t as much of a hindrance to the success of smaller scale, eco-friendly, domestic manufacturers.

In contrast with all the above perspectives, some still say that domestic manufacturing employment is already far more prosperous than most of us realize. A recent paper from the Center for Opportunity Urbanism indicates that 52 of the country’s 70 largest metropolitan locations have actually seen an increase in industrial employment since 2011. Forbes agrees and both say that while manufacturing is unlikely to disappear altogether, the issue is not that the industry is disappearing, but rather that it peaked in the 1950s and will likely never reach or surpass those levels again. Both sources blame automation for the sea change in the industry.

Whatever the case going forward, several of the country’s most prosperous industries are changing the way they do business. Many companies employ technology to cut costs and increase efficiency, often at the expense of jobs. Others simply outsource their production to countries with substantially cheaper labor costs. Might this mean that the end of significant employment in the US manufacturing sector? Possibly. The shifting landscape indicates that the new challenge for governments, manufacturers, and especially for retailers, is creating new jobs. So far, that’s job we cannot automate or replace with technology. Either way, it seems clear that, as technology continues to advance, creative destruction will continue to bedevil any semblance of a stable labor market.

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CBP 201: Products to Watch Out For

Sadie Keljikian, Express Trade Capital

A galaxy of constantly changing regulations governs the complex world of US imports. In our previous article on this subject, we focused on agricultural and licensed products. This time, we focus on some of the primary regulatory requirements imposed on other varieties of goods.

Medications/Medical Equipment

Prescription drugs, and even certain non-prescription drugs, are strictly regulated in the US, so much so that imported medications and medical equipment must be declared and permitted by CBP and the FDA ahead of shipment. Adding to the difficulty of regulatory compliance, international laws regarding medical supplements and equipment change quickly and often, which requires importers to stay vigilant and nimble.

Paperwork is paramount. For example, drug paraphernalia imports are illegal in the US unless intended for “authentic medical conditions.” If you import goods classified as drug paraphernalia, it is safest to include as much documentation as possible to specify and confirm the intended use of the items in question, including medical records if possible. Thorough documentation should, in theory, help your goods move more quickly, but you should always build in extra time in case CBP flags your shipment for inspection.


Depending on your level of experience in the automotive industry, you may have trouble auditing your automobile imports since regulations are more technical than those for most other products.

First and foremost, any automobiles imported into the US must adhere to the Environmental Protection Agency’s fuel-emission requirements, unless the vehicle was manufactured before a designated date. Gasoline-fueled cars or light-duty trucks, for example, must adhere to federal emission standards unless they were manufactured before January 1st, 1968.

Furthermore, if the vehicle has ever been driven outside the US, its undercarriage must be thoroughly cleaned to remove any foreign soil or dangerous pests. CBP indicates that you must have the car steam-sprayed or thoroughly cleaned by other means prior to shipment to prevent ecological damage.

There are also specific documentary requirements for automobile imports including EPA form 3520-1 and DOT form HS-7. Depending on the vehicle’s size, vintage, and fuel efficiency, there may be more. As always, do your research or hire a customs broker if you aren’t confident in your compliance.

Ceramic Home Goods

Although items like ceramic tableware and other home goods are not restricted per se, some ceramic goods from outside the US contain dangerous levels of lead in their glaze. These products are ultimately unsafe because the lead can seep into food and beverages served on or in them. Therefore, when importing ceramics, the primary concern is lead concentration.

CBP recommends testing the lead content in imported ceramics to avoid distribution of harmful goods. Since a lot of countries do not have strict legal guidelines for vessels intended to handle food, foreign government agencies will often skip this step. Thus, it is up to the ceramics importer to obtain satisfactory inspections and documentation.

If you must import and distribute ceramics that are not safe for food or drink, or you cannot ensure quality control or compliance, you must provide clear instructions to use those ceramics for decorative purposes only when you distribute them to avoid endangering customers and possible litigation.

Cultural Artifacts

One of the more prevalent challenges in importing is monitoring your supply chain. If your goods come from a foreign country, and you aren’t familiar with your supplier’s practices, you could find yourself in possession of, and liable for, stolen cultural artifacts. The best way to avoid this is to know with whom you are doing business and remain extra cautious in countries that are home to frequent artifact smuggling. As always, obtaining thorough documentation is key to avoiding confrontations with the CBP and other government agencies with jurisdiction over the matter.


While alcohol imports are generally legal in the US, one must acquire a permit from the Alcohol and Tobacco Tax and Trade Bureau before importing alcohol for sale. It is also important to note that most alcohol regulations differ between states. Thus, there are limits on the quantity of alcohol one can bring into certain states. Importers must always thoroughly research the regulations of state into which they plan to import alcohol and acquire any additional permits.

It is important to note that absinthe and any comparable spirits fall under stricter regulations. If you import absinthe, you need full details on the brand you plan to purchase and its packaging. Bottles labeled with the word “absinthe” or printed with images implying psychotropic effects may not be imported into the US. The product must also contain less than 10 parts per million of thujone due to its potentially dangerous effects.

These are just a few of CBP’s regulatory requirements and restrictions. CBP’s numerous regulations cover virtually all commercially traded goods. Before importing goods, educate yourself thoroughly, or, hire a competent customs broker to guide you through the process and to ensure that your goods are never delayed or detained due to lack of compliance.

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The Amazon-Walmart Showdown

Viviane Simond, Express Trade Capital

Amazon and Walmart are vying to provide virtually every consumer good imaginable, and Amazon appears to be winning. Amazon is currently in the process of buying Whole foods for $13.4 billion. Since the news broke, Amazon’s market shares have remained stable while other large-scale retailers struggle to stay afloat. Walmart is no exception, their market capitalization dropped 5% immediately after Amazon announced their plans.

Walmart has been scrambling to diversify and keep up with the growing popularity of e-commerce. They recently purchased Bonobos, a high-end brand that sells dress shirts and other professional wardrobe staples, for $310 million. Despite having an initial disadvantage, Walmart’s persistence is paying off. Their online sales have grown 63% since last year, likely thanks to the retailer’s moves to harness third party appeal by buying brands like ModCloth and

Meanwhile, Amazon is continuing to build a full-service industry with consistent new services like Prime Wardrobe, a fashion box from which customers may choose items to keep and return the rest, much like StitchFix. Amazon even has its own grocery service, known as “AmazonFresh,” but it’s yet to see much activity due to the logistical and financial issues surrounding perishable deliveries. Surprisingly, Walmart has the upper hand in this area…for now. The super-store currently has locations within ten miles of 90% of American shoppers and provides a delivery service allowing customers to place orders online and pick up in-store without waiting in line. Walmart’s niche dominance may shift, however, with Amazon’s upcoming acquisition of Whole Foods and the announcement of a series of brick and mortar locations.

Last year, Walmart attempted to catch up to Amazon when they purchased for $3 billion. The investment is proving fruitful, but still brings in only a fraction of Amazon’s e-commerce revenues. Following Amazon’s announcement, Whole Food’s stock went up $9.62 per share and Amazon’s jumped $23.54 per share (2.4%). Unfortunately, other retailers saw the opposite effect. Walmart’s shares dropped by 4.7%, Target by 5%, Costco 7%, and Kroger 9%. Competing retailers are also concerned by Amazon’s plans to reduce Whole Foods’ prices and change inventory. Amazon hopes that this will help attract a wider customer base, but it may spell trouble for smaller businesses that can’t afford to compete.

Experts say that at this point, Walmart is one of the only retailers that directly competes with Amazon in terms of size, scale, and market value. Walmart has certainly made aggressive attempts at competition, consciously avoiding annual membership programs like Amazon Prime and insisting that their tech vendors not run applications through Amazon’s Web Service (AWS). Walmart has also been consistently acquiring new internet-based brands, focusing on product varieties Amazon lacks. Regardless of the future of Whole Foods, Walmart plans to continue expanding their product base to compete more effectively. Amazon has publicly condemned Walmart’s prohibition of AWS within their network, claiming that the restriction will hurt customers and tech companies alike.

Whatever happens next, it’s becoming clear that all retailers may fear Amazon’s influence before long. The e-commerce giant continues to grow and diversify its offerings and aggressively drive down prices, increasing competitors’ difficulty in keeping up.

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