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 Legal Briefs
By Gina Valeri Director of Legislative Affairs & General Council, APPMA Compliance Solutions Aid Supply Chain If You Plan to Sell to Big Chains or Export, A Myriad of Compliance Issues Must Be Dealt With: Here Are Some Tools to Do the Job Manufacturers and retailers share the goal of delivering products as quickly as possible to consumers. When inventory is held up in the supply chain because of noncompliance with import/export regulations or because of technical paperwork glitches, everyone suffers. Therefore, manufacturers are increasingly relying on systems providers to satisfy retailer customer demands and avoid charge-backs, deductions, or other penalties. The Credit Research Foundation states that "5% to 15% of all invoices were affected by chargeback deductions, amounting to from 4% to 10% of all open items on accounts receivable…" In addition, the National Chargebacks Management Group found that charge-backs can claim from 2% to 10% of a manufacturer's overall revenue. Various regulatory challenges impact the sale of pet products including, for example, regulatory developments relating to BSE, foot-and-mouth disease, and/or other pathogen-monitoring regulations, bioterrorism, tariffs, NAFTA, etc. These regulations change on a daily basis and it is increasingly difficult to keep up with import or export certificate amendments, packaging and shipping requirements imposed by the US government and its trading partners. While manufacturers struggle to keep up with the changes, retailers are the first to be inspected by the government and are the more visible players in the supply chain to be impacted by delays in shipments, stop sale orders and recalls. Large retailers of pet products, such as PETCO, PETsMART and Wal-Mart, are requiring that their vendors use specific software or other technology to streamline compliance checks and add efficiency to the supply chain process. For instance, the International Compliance Information Exchange (ICIX) is officially sanctioned by PETCO and, according to an ICIX press release, "provides a Web-based solution for verifying, communicating and promoting supplier compliance with myriad food safety and quality standards." In addition, the iCiX ApprovedSupplier Exchange system allows suppliers to verify that expired insurance has been reinstituted or that a manufacturing or warehouse facility has taken corrective action to meet health and safety codes. The Melbourne, Australia-based company relies on NEC and Verisign technology and can be accessed at http://www.icix.com Another Internet-based system used by members of the pet industry for vendor compliance is TradeSense by Importers Software, Systems and Solutions for International Trade. Importers Software helps suppliers maintain an updated compliance program to reduce penalty exposure and eliminate delays. For example, the TradeSense Trade Data Repository allows participating companies to maintain and access all trade-related data in one location for "easy management, consistent deployment across all entry ports, and facilitate automated document preparation," according to the company website at http://www.importerssoftware.com Lastly, American River International, an APPMA discount vendor, provides various services to facilitate freight compliance including "creating standard operating procedures to compliance in the supply chain" and compliance and security management. Access its website at http://www.worldest.com/ari.htm. Other vendor compliance information is available on the APPMA Website including a new listing of product testing laboratories and other resources on the "Products & the Law" webpages at http://www.appma.org For more information, contact Gina Valeri, APPMA's Director of Legislative Affairs & General Counsel, at gina@appma.org. To access more information about specific issues or services, click here. |
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