The Global Trade Management (GTM) solutions market grew to about $222 million in 2005 and will reach $405 million by 2010 according to ARC Advisory, a Dedham, Mass.-based consulting firm.
"Historically, CEOs and CFOs have failed to grasp the role and importance of Global Trade Management relative to financial performance and strategic objectives. They viewed GTM as 'paperwork' and a cost center. But this perspective is beginning to change. The 9/11 terrorist attacks and the 10-day shutdown of West Coast ocean ports in 2002 taught many executives a lesson on how disrupting the flow of global trade can have significant financial consequences," said Adrian Gonzalez, director of ARC's Logistics Executive Council and author of the study, Global Trade Management Solutions Worldwide Outlook.
Trading globally, companies face a variety of financial risks. Duties, taxes, transportation charges, and currency exchange rates are contributing factors; but there are other, less-tangible factors that also influence the bottom line such as the cost of increased inventory and longer cash-to-cash cycles due to customs clearance delays.
Supply chain security is also another area of concern that has been improved since 9/22 in the form of initiatives including Customs-Trade Partnership Against Terrorism (C-TPAT), the Container Security Initiative (CSI) and the Advanced Manifest Rule.
In addition to security compliance, there is Sarbanes-Oxley compliance. "Achieving compliance with Sarbanes-Oxley, a law aimed at improving the accuracy and reliability of corporate financial statements, is dependent on having access to timely, accurate, and complete information and establishing process controls -- the same success factors required to create more secure and efficient global trade operations," explains Gonzalez.
For a copy of the study visit: http://www.arcweb.com/research/ent/gtm.asp
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