Logistics managers should prepare for surge in Global Trade Management demand

By the expansion of international trade and major new trade agreements, the worldwide market for Global Trade Management (GTM) will continue its strong growth over the forecast period, according to a new ARC Advisory Group study.

International Trade Visibility and Execution – one of two GTM categories defined by ARC – will see an expanded part of the market that wants more emphasis on functionality to understand air and ocean carrier schedules, tender to those carriers, and execute the loads.

“These solutions may also manage related documentation, such as bills of lading, and provide visibility into key in-transit events, such as carrier receipt of goods and vessel departure and arrival.  This is being driven by events like the recent dock strike on the US west coast, and an increasing fluctuation in shipping schedules,” according to Senior Analyst Steve Clouther, the principal author of ARC’s “Global Trade Management Global Market Research Study.”

Increased Customs and Compliance Audits by Authorities

Increased customs and compliance audits by authorities are forcing companies to establish controlled processes within the organization by implementing global customs and compliance solutions.  At the same time, executives are becoming more familiar with GTM and are recognizing the positive impact that it can have on their cycle times and bottom lines.  As GTM becomes more mainstream, it’s driving more companies to initiate GTM projects.

GTM Fueled by an Expansion of Global Trade

The GTM market growth is being fueled by an expansion of global trade, as more underdeveloped countries are slowly getting into manufacturing goods for export.  This in turn is leading to the implementation of more trade agreements and Free Trade Zones.  And, on top of that, compliance regulations are getting tougher and becoming electronic driven.

Asia to Pick Up the Pace with Exports

Historically, North America and Europe have been the dominant regions, but now, we see that Asia, especially China and Japan, are exporting manufactured goods on an accelerated rate.  This acceleration will pick up speed once the Trans-Pacific Partnership (TPP) is implemented.

Two Major Trade Agreement to Impact Global Trade

All the leading economic organizations agree that the top four economies in the world are the United States, China, Japan, and Germany, but what is quite significant is that the European Union (EU) is larger than the United States.  These two are going to play major roles in two trade agreements that are in discussion now; the US in the Trans-Pacific Partnership (TPP), and the US and EU in the Transatlantic Trade and Investment Partnership (T-TIP).