International trade is a complex beast and even for the most seasoned exporter there comes a time when a small detail overlooked has expensive and time-consuming repercussions. This is particularly true for Food and Beverage (F&B) exporters who must operate within a heavily regulated environment. In the markets I work in across Southeast Asia, Hong Kong, Taiwan and Korea Governments take food safety very seriously and any breach of regulations or threat to public health can have significant repercussions.
Take for example the Botulism scandal the rocked Fonterra (and the New Zealand food industry at large) in 2013. A “False Positive” test result in New Zealand sent our dairy exports to Asia into turmoil. The Asian media reacted savagely and dairy exports plummeted. Fonterra was fined for the error, but the toll on the dairy export sector was heavy and long lasting.
Product labelling for international markets is especially prone to error. I’ve seen the future of well-established companies put in jeopardy because of basic details, such as erroneous labelling on an order - because the labelling conflicted with local regulations the buyer rejected the goods and the product was destroyed, in accordance with local law. The exporter had to bare all costs. In the blink of an eye, a lucrative sale turned into a tremendously expensive disaster.
Another exporter I know sent goods to their customer with a competing distributor’s sticker on the product. A lot of effort was invested in smoothing ruffled feathers.
For most exporters, one of the most detail-oriented times is when it comes to delivery of an order. The process usually goes something like this: 1. Settle payment terms; 2. Schedule production; 3. Book space on a ship or flight. 3. Organise export documentation. 4. Deliver the goods.
The process seems simple enough but ask any exporter and they will tell you that these four little tasks can take countless hours and cause inordinate amounts of stress.
I recall a particularly high pressure incident that had me up at 4.00am in Hong Kong, frantically on the phone to New Zealand (it was 8.00am there), trying to track down a missing piece of export documentation vital to clearing a shipment of chilled, short shelf life, high value goods that would be landing in Kuala Lumpur in less than six hours. If the right set of documents was not presented, Malaysia Customs would hold the shipment, racking up expensive storage fees, losing precious days of shelf life and taking up a good deal of everyone’s time. Worse still, Customs could have destroyed the whole shipment and fined the importer.
Mercifully, the oversight was quickly resolved and thanks to a great display of cross discipline teamwork the cargo cleared without any delays.
It takes absolute focus and dedication to compete in international markets. Methodically working through every step and drawing on the strength of a skilled team of people contributes significantly towards long-term success.