July 2013 | Commentary | Supply Chain Security

C-TPAT: Building Safer Supply Chains

Tags: Security, Risk Management, Certifications

Jose Minarro is Managing Director, Transplace Mexico, 956-267-1712

The growing security concerns companies face in the global market make it critical to understand potential supply chain risks, and establish a managed, proactive approach to security. One significant step companies can take to protect their supply chains is becoming a member of the Customs Trade Partnership Against Terrorism (C-TPAT) program.

As C-TPAT members, organizations in all supply chain sectors fully cooperate with U.S. Customs and Border Protection (CBP) to establish acceptable security practices throughout their entire logistics operation.

Stronger Together

C-TPAT was designed to build cooperative relationships that strengthen international supply chain and U.S. border security. It seeks to safeguard the world's trade industry from terrorists, while maintaining the economic health of the United States and its neighbors.

Since C-TPAT launched in 2001, cargo examination rates have grown, largely because of the increased use of non-intrusive inspections. Typically, 11 million truck containers cross U.S. borders every year, and the examination rate is 25 percent—essentially one in every four trucks. Rail containers have an exam rate of 91 percent and, with all transportation modes, one exam occurs for every five movements.

Companies partnering with the CBP sign an agreement to protect the supply chain, identify security gaps, and implement specific security measures and best practices. Each company must provide a report specifying the security measures it has implemented.

Currently, there are more than 10,000 certified C-TPAT partners, which include U.S. importers, U.S./Canada and U.S./Mexico highway carriers, and licensed U.S. customs brokers. These certified companies account for more than half of products imported into the United States.

Weighing the Benefits

In addition to promoting supply chain security, participating in the C-TPAT program can yield significant benefits for shippers and transportation providers alike, including:

  • Fewer customs inspections. C-TPAT certification offers companies the opportunity to decrease customs inspections and documentation reviews.
  • Faster border crossings. Members can use special lanes designated for C-TPAT partners at border crossings, and can move to the front of the line during inspection.
  • Quick response time. Companies participating in the C-TPAT program can resume business quickly in the case of a terrorist attack or national emergency.
  • Enhanced brand reputation. Participating in a national security program reflects the company's commitment to cargo safety.
  • Improved efficiency. C-TPAT members have a better chance of co-loading northbound cross-border shipments without affecting transit times.

C-TPAT importers are four to six times less likely to incur a security or compliance examination, according to CBP. C-TPAT members can also decrease supply chain disruptions and generate significant opportunities to avoid costs, while improving predictability in moving goods across borders.

Seeking Eligibility

Eligibility requirements vary depending on the type of business—importer, customs broker, carrier, or manufacturer. To achieve certification, companies are required to conduct a risk assessment to determine their threat level, then implement a supply chain security management system that complies with C-TPAT requirements for that company's business type. Finally, eligible companies must submit a detailed application.

After a company submits the application and security report, the CBP meets with company representatives to verify security measures are being followed and are accurate.

The 3PL Connection

Shippers can help support the C-TPAT program by obtaining their own certification, and working with third-party logistics (3PL) providers that are also C-TPAT certified. This allows companies the ability to minimize supply chain disruption during a crisis.

C-TPAT-certified 3PLs act as an additional layer of protection against supply chain attacks, because they operate as an extension of the company's established security procedures, essentially building a stronger company brand.

A 3PL with active participation in the Mexican and Canadian markets also brings a portfolio of carriers and companies that are approved by C-TPAT, or that comply with minimum requirements for C-TPAT partners, essentially giving shippers a competitive advantage.

Certified 3PLs can help shippers broaden their carrier network and, ultimately, can open more doors for shippers to do business both internationally and domestically.

And because of the requirements 3PLs must meet in order to become C-TPAT participating companies, they would also have a hand on the cargo at all times, ensuring the shipment is always secure.

Safety Assured

With security risks threatening supply chains around the globe, companies should support initiatives such as C-TPAT that aim to tackle and prevent supply chain risks. Participating in C-TPAT assures importers, shippers, carriers, brokers, and logistics providers a safe, secure, and expeditious supply chain, benefiting their employees, internal operations, suppliers, and customers.

Obtaining C-TPAT certification offers businesses the unique opportunity to take an active role in supporting national security, while improving their own supply chain operations.