As countries seek to maintain economic competitiveness and growth, one factor critical to economic development is the ease of trading goods and services. In an increasingly globalised marketplace, customs agencies eager to contribute to a nation’s growth must innovate to differentiate themselves in order to attract and retain trade.
Traders’ expectations are changing, informed by their experiences with the private sector and outside the logistic supply chain. These expectations and the way traders do business with other traders are rapidly spilling over to include government services. For example, the advent of online platforms such as Fleet, a "Yelp" for freight forwarders, and Flexe, an "Airbnb for warehouse space"1, reflect the levels of innovation traders now expect—and dictate how customs agencies must act.
Agencies must learn lessons from the private sector and rethink existing practice in order to meet these shifting expectations—delivering public service for the future.
Today, traders can choose where to do business. They will increasingly opt for the countries that provide the best opportunities and make it easy to trade, creating competition between nations to win and retain trade. Customs are in a key position to influence how easy it is to trade between countries, where they can act as a trade barrier or a trade facilitator. Testament to this are the many customs related measures that define global trade benchmarks such as the World Economic Forum’s Enabling Trade Report or the World Bank’s Logistics Performance Index.
Adopting private sector strategies, customs agencies should use big data to gain insights into trade flows in order to understand and support their nation’s competitive advantages.
There is a lot of supply chain information available, of which much is not yet used by agencies. But big data need not mean big headaches. By leveraging predictive capabilities, agencies can also carry out trader segmentation, analyse data and detect patterns that allow them to identify different trader requirements and behaviors.
Every trader is unique, and a "one-size-fits-all" approach will not work in the race to attract trade.
Private sector companies have long understood that clients run their businesses. They have adopted big data and analytics to better understand clients’ motivations and behavior.
To grow or even maintain trade volumes and revenue, customs agencies must recognise that they can no longer afford to ignore the dynamics of global trade and be concerned only of their own requirements. Agencies must invest in understanding trade supply chains if they are to innovate, differentiate themselves and attract trade.
Businesses understand that it is not possible to appreciate the customer journey unless you take it yourself. Customs agencies must take a similar approach. Each trader’s journey is unique and their requirements are diverse. Agencies must put themselves in traders’ shoes to understand trade supply chains themselves—for example, trialing the trader experience on their own websites or attempting to self-serve for a potential trade.
Traders have grown accustomed to a real-time, personalised user experience across a range of digital platforms. They now have heightened expectations about what different organisations—including customs agencies—can deliver. Driven by the exponential growth of ecommerce, some are even disrupting their own industry, leveraging digital to redefine logistics in order to provide a more personalised service.
Customs agencies must also move beyond compliance. To help customers trade efficiently, they must develop interactive services that employ user-centric design principles. By doing so, they will be able to win and retain trade.
Agencies that provide a smoother customer experience enjoy an added benefit. The reduced friction experienced by traders will also help to boost compliance, reduce agency errors and minimise trading costs.
Existing agency approaches are unlikely to attract trade in an increasingly digital environment. To capture trade in an increasingly competitive global market, agencies must learn from the private sector and focus more on the customer experience. By doing so, they can demonstrate innovation in order to meet the expectations of the trading community—delivering public service for the future.