A successful supply chain is typically one that evolves to meet changing needs and continually improves. One way to consider enhancing your supply chain is to get a CTPAT certification.
What Is CTPAT?
The Customs-Trade Partnership Against Terrorism (CTPAT) is a voluntary initiative by U.S. Customs and Border Protection to forge public-private partnerships to improve international supply chain security, plus goods coming into the United States. The program’s foundational principle is that better supply chain security is only possible through close cooperation with global supply chain partners.
Since its launch in 2001, more than 11,400 partners got certified through this program. They include importers and exporters in the United States, Canada and Mexico, licensed U.S. customs brokers and ocean transportation intermediaries, among others.
How Does a Company Pursue CTPAT Compliance?
Once a company decides to get certified through this program, they make a formal declaration to work with U.S. Customs and Border Protection officials to identify and address risks that threaten supply chains. You may be eligible if your company can demonstrate a commitment to upholding the best practices for supply chain security, and you have not experienced major breaches due to unmanaged shortcomings.
Completing a security risk assessment is the first step to working toward CTPAT certification. It requires you to evaluate your supply chain operations, service providers and foreign suppliers. The next requirement is to submit your application through a dedicated portal. When you do this, you’ll need to provide details for both a Company and Security Profile. A supply chain security specialist will then review the content to determine your candidacy.
What Information Does the Application Require?
The Company Profile part of a CTPAT application is relatively straightforward and asks for details such as your address and contact information. However, the Security Profile is significantly more involved. It requires applicants to show that they can meet minimum requirements to keep their supply chains safe.
The responsibilities for achieving CTPAT compliance vary depending on a company’s role in the supply chain sector. Statistics show that 90% of Fortune 500 companies use third-party logistics in their supply chains. It’s no surprise that there are specific requirements for those entities, and sea, rail and highway carriers, to name but a few.
How Should an Entity Prepare for CTPAT Certification?
The documentation of eligibility requirements for each respective group features a chart of the criteria, plus implementation guidelines. Every section of the table also indicates whether a candidate should or must abide by it. For example, one of the must-do parts of the framework for foreign manufacturer concerns conducting systematic security and agricultural inspections. This requirement mandates doing eight-point checks on empty refrigerated containers.
The best initial step for a supply chain business to take is to access the relevant breakdown of eligibility and determine how far off the company is from what program officials require. Some companies provide workshops and audits to give businesses a clear idea of where they stand and what must happen to improve the likelihood of successful certification.
How Does the CTPAT Initiative Affect Trade?
Deciding to become a partner through this initiative could help your business because it demonstrates to potential clients that security is a priority rather than an afterthought. That’s an advantage by itself due to the competitive boost it provides. However, you may also notice several other perks that make it easier to engage in trade across borders.
For example, statistics indicate that members are 3.5 times less likely to get stopped for security or compliance examinations. Staying compliant also moves you to the front of the line at border crossings. That could mean your shipments reach their destinations faster than before, keeping customers pleased. Another positive impact on trade is that certified companies enjoy permission to resume their businesses first after natural disasters or terrorism events.
What’s New in 2020?
If you’re interested in applying for this government scheme, keep in mind that new minimum security criteria arrived this year. Most partners adhere to a four-year validation cycle. It determines when they must submit proof of continuing to operate according to the stipulations of remaining in the program. Regardless of whether a company had a validation scheduled for this year, they must implement these newest requirements.
Government officials put them into effect in January 2020. There are two changes in effect now. One relates to initiating an analysis after a security incident affecting the supply chain. The second alteration concerns publishing a code of conduct for employees to establish expectations for behavior at work.
What Are the Costs and Timeframes Associated With CTPAT?
There is no charge to take part in the CTPAT program. Although you may choose to work with specialists that understand the process and advise you on how to move forward, there is no requirement to work with one of these intermediaries while preparing or submitting your application. There are also six CTPAT field offices that you can contact by email to ask questions.
Once you apply, the deciding party has up to 90 days to determine whether to grant you CTPAT certification. Certified companies get awarded full validation within a year after the authority deems their attempt successful.
Is CTPAT Compliance a Good Goal for You to Set?
There’s no single correct answer to confirm if you should take steps to comply and enhance your security. However, it’s worth mentioning that there are arguably no downsides to focusing on security. No matter if you do it through this official channel, adopting more secure procedures can streamline your operations, attract new clients and prevent catastrophes.
A positive aspect of this program is that it spells out precisely what you should or have to do to make your supply chain safer and more resilient. That means if you’re interested in making related gains but don’t know where to start, the documents associated with this initiative could move you in the right direction.