Crisis Averted
16 March 2021Read how changes due to Brexit turned a routine shipment into a potential nightmare.
A Multi-layer Shipment
Ship from: Australia
Ship to: Germany
Shipment type: High-value IT Hardware
Background
A firm needed to transport vital data center equipment from two of their data centers in Australia to multiple locations in Germany.
In sheer logistical terms, this was going to be a complex operation: 400 racks of high-value IT equipment needed to be shipped between continents. No less importantly, the shipment raised a number of bureaucratic challenges. According to the firm’s internal policies, each local subsidiary was required to buy and sell within the country in which they operated. The policy ruled out cross-border transactions.
This was a job for a specialist Importer of Record like TecEx.
TecEx was able to organize the shipping process and assist in structuring the transaction to conform with our client’s policy. In addition, the transaction raised a number of tax implications. TecEx harnessed its experience and expertise to structure this bespoke transaction to be as tax efficient as possible.
The Process
Managing Freight
The logistical demands of the project were enormous.
TecEx needed to organize collection of the equipment from two different locations in Australia.
The equipment – a huge load comprising over 40 containers – needed to be palletized in preparation for shipping.
Given the quantity of goods, the containers were sent on three different ships.
TecEx thus had to coordinate three different shipments on the export side and coordinate the arrivals and customs clearance on the import side.
For the client, the whole process happened seamlessly. Once the equipment was collected, the client had no further involvement in the shipping process, either in terms of managing logistics or dealing with bureaucratic paperwork.
Through TecEx as a single point-of-contact, our client was able to initiate a complex chain of logistical events, with the reassurance that TecEx was managing every stage of the process from collection to delivery. At the same time, the client received regular reporting from their TecEx liaison, keeping them up-to-date at all times.
Clearing Customs
Managing shipping was just the first stage of the transportation process. Upon arrival in Germany, the goods needed to be warehoused, deconsolidated and then delivered to two data separate centers.
In these situations, timing is critical. Clients will typically have a team of engineers in place to install equipment; missing these windows will be expensive. Additionally, late deliveries to data centers can create bottlenecks that are extremely disruptive and costly to multiple parties.
Of course, while meticulous planning is a hallmark of the TecEx approach, managing complex logistics requires an ability to adapt quickly if conditions change.
In the case under discussion, the shipment proceeded largely as planned. However, close to the specified delivery date, our client made numerous changes to the final delivery locations.
The TecEx team was able to quickly adapt, ensuring all personnel and equipment were in place as per the changing terms of delivery, while still keeping to the specified delivery times.
Plug and Play
TecEx is able to tailor our service to meet our client’s specific requirements. Our client wanted the entire shipment to be managed by TecEx, from collection to delivery.
In this case, that meant TecEx had to organize personnel to remove the goods from the pallets and unwrap them upon arrival at the specified delivery locations. We were also mandated to place equipment in the appropriate sections, on different floors, at the various delivery points.
A massive shipment of equipment had been collected from locations halfway across the world, arriving in carefully staggered shipments, crossing customs with the appropriate licenses and meeting all regulatory requirements. The equipment had then been delivered to the required locations, unwrapped and installed precisely where needed.
Throughout the entire process, the client was kept informed of the shipment’s progress but otherwise had chosen to have no involvement. All our client had to do was show up at the end location and plug in their equipment.
Pulling it All Together
Each element of the shipment had its own challenges, but the complexity of the overall process amounted to more than the sum of its parts.
There were multiple, interconnected elements:
First, there were the procedural requirements. Our clients needed to structure a solution that met their stringent internal policies and that was also highly tax efficient.
Second, the regulatory and bureaucratic procedures involved in importing and exporting IT equipment, both as Exporter of Record and Importer of Record, including licenses, brokerage, complex paperwork, plus dealing with local offices in local languages and making payments in local currencies.
Third, the logistics of shipping and delivery. That meant moving fragile, high-value equipment across continents. It also meant advanced strategic planning, such as carefully staggering shipments to minimize warehouse costs and thus reduce overall costs for our client. In this case, it also meant teams on the ground to prepare and install the equipment at the final locations.
Only TecEx has the ability to seamlessly manage all of the elements of such a complex transaction. That means peace of mind for our clients. It also means they can initiate a multilayered, highly complex shipment with one point of contact and one consolidated invoice.
Ultimately, this case exemplifies the core TexEc value: building relationships. Beyond our expertise, what sets us apart is our commitment to working tirelessly on behalf of our clients, to ensure their goals are successfully met. Whatever the world throws at us.
