INDUSTRIAL WAREHOUSE UNDER COMPUTERIZED CUSTOMS CONTROL REGIME: SOME EVIDENCES FROM BRAZIL

Transcription

1 INDUSTRIAL WAREHOUSE UNDER COMPUTERIZED CUSTOMS CONTROL REGIME: SOME EVIDENCES FROM BRAZIL Adilson Rocha, Renato Perrotta, Oduvaldo Vendrametto, Jorge Monteiro Junior Unip Paulista University, Graduate Program in Production Engineering, Sao Paulo, Brazil

2 Paper Content 1.Introduction 2.The State of the Art 3.The origin of the Brazilian automotive industry 4.Brazilian auto parts sector 5.Industrial Warehouse under Computerized Customs Control Regime 6.The research in companies authorized to operate in customs procedure RECOF 7.Conclusions

3 Agenda 1.Introduction 2.The State of the Art 3.The origin of the Brazilian automotive industry 4.Brazilian auto parts sector 5.Industrial Warehouse under Computerized Customs Control Regime 6.The research in companies authorized to operate in customs procedure RECOF 7.Conclusions

4 Introduction Important to mention: Automotive sector in Brazil has faced growth along the last years, but, reveals structural contradictions: Some Positive aspects of the country s automotive market: the internal market has attracted an impressive number of carmakers new players arriving due other policies related to the sector internal market combined with several manufactures, all of this, configures Brazil as an important player in this industry

5 Introduction 2012 PRODUCTION STATISTICS Total Production Country (million units) China 19,27 USA 10,33 Japan 9,94 Germany 5,65 South Korea 4,56 India 4,15 Brazil 3,34 Adapted from: OICA - International Organization of Motor Vehicle Manufacturers special remark: volume wise, the industry also became a vital sector to the country

6 Introduction Some contradictions of the country s automotive market: historical lack of long term industrial policies opportunistic decisions strong dependence of initiatives and international interests Special remark: Program Inovar-Auto

7 Introduction Facing facts: strategic decisions of these manufactures of use the international net of suppliers current imbalance between number of automakers and local suppliers dependency of the imported parts, systems, components Special remark: Program Inovar-Auto

8 Introduction Facing facts: with such volumes, the supply chain is always the bottleneck so forth, customs embarrassments could, potentially, be an obstacle to the production targets

9 Introduction How to keep it walking? with the objective to secure the productive and competitive capacity, Brazilian authorities have created special customs arrangements which will act as facilitators the remedy: RECOF (Regime Aduaneiro de Entreposto Industrial sob Controle Informatizado) it acts in temporary admission for warehousing, temporary exportation, re-importation, among others

10 Industrial Warehouse under Computerized Customs Control Regime Customs Regimes are procedures created by government entities with the aim: to reduce bureaucracy encourage external market as well as avoiding lapses that can reduce or prevent production operations

11 Industrial Warehouse under Computerized Customs Control Regime RECOF was established by the decree number 2412 (1997) it allows importation of goods for operations of industrialization, which aims the external market it guarantees suspension of tax payments nevertheless, according to Ashikaga (2011), part of this production can be nationalized so forth, both the operations of importation and the productive process are performed under customs control

12 Industrial Warehouse under Computerized Customs Control Regime RECOF also diciplines customs control of entry, stay and exit of goods that is performed individually by the qualified importing company a computerized process, using a software developed by the beneficiary, but in line with computerized control systems of the Federal Revenue Office it generats monthly reports of the goods status under the RECOF

13 Industrial Warehouse under Computerized Customs Control Regime RECOF facilitators: the inputs can be imported with or without exchange coverage also, input can be purchased in the internal market with suspension of federal tributes the special customs regime is valid up to one year, extendable for the same period

14 Industrial Warehouse under Computerized Customs Control Regime Taxes suspended: II (Import Tax) IPI (VAT over Industrial Production) PIS (VAT - Contribution to the Social Integration Plan) COFINS (VAT Contribution for Social Security Financing)

15 Industrial Warehouse under Computerized Customs Control Regime Main Benefits of the Regime: reduce bureaucracy in the international trade facilitates importations and encouraging exportations agility in the importation with customs clearance process reduction in the working capital costs

16 Industrial Warehouse under Computerized Customs Control Regime Main Benefits of the Regime: rationalization of the cash flow and reduction of storage costs providing the release of the cargo on the ports and airports within 24 hours the entry of raw materials and imported components is guaranteed not necessary to pass through the habitual customs process

17 Industrial Warehouse under Computerized Customs Control Regime Main Benefits of the Regime: it avoids the retention of the items by unexpected problems, as a stoppage in the SRF - Secretaria da Receita Federal it avoids the retention of products for a longer period of time registered companies can keep low levels of stock, to a "justin-time" supply it reduces the costs with storage increases the flow of stocked goods speeds up the products distribution on the market

18 Industrial Warehouse under Computerized Customs Control Regime The counterpart to the application for the Regime: total access to the companies files must be given to the SRF this access is provided by the front-end system through Internet, and it is necessary that all information are updated and correct

19 Industrial Warehouse under Computerized Customs Control Regime The tax system: According to DUTRA (2006) at the exportation, the companies can credit the paid taxes in the acquisition of imported goods the final product (internal or external market), the company is credited from the IPI paid in the purchase of raw material and inputs from habitual processes

20 Research in companies authorized to operate in customs procedure RECOF automotive companies approved by the IRS to use the customs procedure: Renault, Peugeot-Citroen, Volvo, Caterpillar, Komatsu, Siemens VDO (Continental), Delphi, Honda, Bosch, Dana, Goodyear, Denso, Sabó, Behr, Case New Holland, Toyota

21 Research in companies authorized to operate in customs procedure RECOF in field research 93.75% of these companies have filled in the full implementation acquisition of software packages and hiring consultancy for the implementation and compliance of the total budget planned for deployment and training of employees

22 Research in companies authorized to operate in customs procedure RECOF for the benefits of the ERP system integrated with the system RECOF 100% of the answers gave greater importance to the alternatives: it supplies the deficiencies of the system RECOF regarding the management reports better performance in areas where the ERP system is not fully integrated

23 Research in companies authorized to operate in customs procedure RECOF main benefits achieved: work processes and organizational environment. 87.5% gave more importance to the alternatives: rationalization, flexibility, agility in operations and ways of working cost savings, avoidance of operational problems and rework

24 Research in companies authorized to operate in customs procedure RECOF in ranking, on the verification of the main quantifiable benefits achieved with RECOF in all cases the alternatives that have higher importance: reduced inventory since all imports will be released in the green channel gain on reduction of storage exemption from payment of the inevitable losses in the production process

25 Research in companies authorized to operate in customs procedure RECOF in ranking, on the verification of the main non-quantifiable benefits achieved with RECOF in all cases the alternatives that have higher importance: reducing the impact face strikes or standard operating corporate image front and SRF flexibility that allows you to export or re-export items admitted in the same state and problems of obsolescence, as a guarantee for spare parts

26 Research in companies authorized to operate in customs procedure RECOF in the hierarchy of the main check-on, 87.5% of the responses to the alternatives: cost of software license control system and RECOF outlays with consultancy for the implementation process RECOF and 68.75% of the answers gave importance to the need to purchase hardware or other issues related to infrastructure

27 Research in companies authorized to operate in customs procedure RECOF Final finding: 68.75% of companies evaluated the alternative RECOF with maximum degree

28 Conclusions RECOF is one of those instruments to help the accredited companies to maintain stocks of imported products the manufacturing companies strategically reduce their costs by importing auto parts when it is convenient and reducing stop risks for lack of supply due to the bulky and costly bureaucratic demands few companies joined RECOF, which lead the Government to allow the use of RECOF by coqualified

29 Conclusions co-qualified companies: with an authorization from an accredited company can be benefited from the advantages offered by RECOF the result of the development of this research was to identify the critical success factors in managing project implementation RECOF factors those, that have not been adequately addressed in the literature on the management of manufacturing processes and competitiveness in the supply chain special remark to the earthquake in Japan

30 Conclusions there are criticisms to the fact that industrial policies or lack of them, for the long run the absence of them only increase the sector dependency transforming the country into an industrial production base to reproduce products created in other countries, with all the consequences that arise from it, technological underdevelopment, continuous royalty payments, huge profit remittances, difficulty in having competitive products special remark: Inovar-Auto program

31 Next steps the authors have initiated a research of Inovar-Auto program in the decree number of October 2012 the program was recently regulamented by the decree number of May 2013 the authors have already approved the paper in the APMS International Conferece and prepare a full paper to be published in Journal

32 INDUSTRIAL WAREHOUSE UNDER COMPUTERIZED CUSTOMS CONTROL REGIME: SOME EVIDENCES FROM BRAZIL Thank you!