Retail Case Study - Marks and Spencer

Our retail expertise

Classifying products for retail needs a responsive and thorough system to make sure goods reach shelves on time for key sales periods like Easter, Halloween and importantly, Christmas.

The festive goods sold in these periods often present challenges. Namely, if they meet the criteria to be correctly included into a specific ‘festive’ heading under the tariff book and align with EU or US classification guidelines. Often, many products fall into a gray area that need resolving by our team of experts.

Additionally, the challenge of classifying multiple product sets with multi-tariffs codes can easily lead to misclassification. For example, a cooking utensil set. Our team knows the GRI’s ruling to determine the correct tariff code and ensure compliance.

For retailers, an effective classification system can save time and prevent costly errors. Our TariffTel system delves into the intricate terms associated with products, and we’ve designed our Item Types to be user-friendly. We eliminate the need for extensive research to ensure classification is accurate, quick and adheres to regulatory standards.

Our process for retail classification

Analysis

Build your knowledge base – Analyse the tariff book, read the rules, and review the rulings

Solution

Know your product – Find out the key product details including raw materials, country of origin, production processes, and packaging details

Implementation

Keep up to date – Review tariff book changes and check for updates

Key Stats

40%

Of tariff codes used are incorrect

10-15%

Of international shipments are delayed due to customs issues which include incorrect tariff codes (Source: American Association of Exporters and Importers)

40%

Increase in admin time to resolve tariff classification errors (Source: Baker McKenzie Law)

4%

Fines of up to 4 x the duty loss or $500k per incorrect shipment (Source: US Customs and Border Protection guidelines)

Featured customer:

M&S ENSURES TARIFF CODE ACCURACY AS PRODUCT LINES EXPAND WITH CENTRALISED CLASSIFICATION SYSTEM

Challenge

The avoidance of future risk was the main driver for M&S when choosing TariffTel. An over-reliance on customs brokers, manual procedures and insufficient internal resource meant that they had to re-evaluate their entire classification process and why they turned to TariffTel for a new approach.

Constantly updated tariff codes from the WCO and the introduction of new brands into their portfolio, required a robust, accurate and timely solution to be implemented.

M&S was also engaged in the process of an AEO application which requires businesses to prove their systems are robust and fully compliant with customs regulations. TariffTel was a fundamental part of this application.

Tariftel solved data management challenges with the disparate & outdated spreadsheets in use

Why TariffTel

M&S wanted to prioritise precise classification for their expanding product lines.

Tarifftel integrates with other providers, such as PLM systems, to streamline processes and obtain the relevant product data needed for precise classification.

Once classified, tariff codes are maintained and accuracy assured as the TariffTel system updates codes whenever there is a change within the tariff. Importantly with the Tarifftel system, teams are notified in advance of any tariff code changes with alerts.

Detailed reporting functions meansthat tax and sourcing teams can create reports within the system to obtain a full view on product classifications and duty costs at any given time.

Accurate, compliant and up-to-date tariff codes for all M&S products.

Results

100%

Tariff code accuracy assurance

Everything is now in one central place.

M&S no longer works off multiple spreadsheets and data sources to classify goods. They have a centralised hub of data relating to all products.

With TariffTel, they have an accurate view of their product portfolio and can access an audit trail on each product they classify.

Buying teams can now accurately determine duty costs of their product range which results in a clearer vision of the landed cost, and thereby prevents any unexpected impact on profit margins.

Tariff code accuracy and compliance are now assured and there is no risk of shipment delays at borders.

“We pride ourselves on bringing assurance and confidence to teams looking to streamline their classification and improve the accuracy of their tariff codes.

Classification is complex but our centralised solution is highly-sophisticated and flexible to integrate with other systems providers to deliver a robust and compliant system teams can trust.”

Elizabeth Davies

TariffTel Customs System Manager

Case studies

Retail