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From Taiwan to the U.S.—Duty-free

When Brandon Stotsenburg, Vice President, Automotive at American Kenda Rubber, heard about the elevated duty fees that the government was imposing, he knew he had to come up with a new plan. About half of the 132 containers filled with tires, were en route from Taiwan, headed to the East and West coast ports. “We had not anticipated these higher duties,” Stotsenburg says. “We needed to find a Foreign Trade Zone (FTZ) warehouse, quickly.”

Evans Distribution Systems fit the bill. Not only did they have availability in their FTZ space, but they were within a reasonable distance from Kenda’s Columbus, Ohio warehouse and yet, centralized in case Stotsenburg found new distribution points for the tires. But the logistical challenge was only just beginning, and Evans’ solution would go far beyond the FTZ zone.

Stage 1: Tire Diversion

By the time Stotsenburg reached out to Evans, the tires were already headed to the U.S. ports. “We needed to intercept their entry into U.S. customs and divert them to Evans’ facility,” he says. “The Evans team understood the issue and were able to reroute the containers directly to the Detroit ramp, all under FTZ status.”

The Evans transportation team went into high gear to redirect the containers to Detroit all while keeping the proper documentation to maintain FTZ status. Port issues, backlogs, and bottlenecks meant the containers were coming at different times and different locations. Evans tracked and traced 75 containers from February through April. Upon arrival at the warehouse, the containers were unloaded, inspected for damage, and inventoried by SKU and documentation. The inventory list had to be error-free otherwise FTZ status could be jeopardized.

Stage 2: Exit and Ship

By June, another 57 containers filled with tires were on the way to Detroit. Luckily, these were routed correctly and had the FTZ documentation. But other logistical challenges loomed. Evans arranged the drayage from the ramp to the warehouse. Once arrived at the warehouse, Evans unloaded containers quickly and shuttled them back to avoid late fees.

The government imposed a short window for the tires to remain duty-free in the zone. All of the tires had a 7-day minimum and a 12-day maximum to stay in the FTZ. “We knew when the window opened but not when it closed; the documentation needed to be set so we could properly exit the FTZ,” Stotsenburg says.

To prepare, Evans worked with Kenda on test cases, where they released tires to see how long the government would need to process the paperwork. A week before the window opened, they had a final run-through of the physical and electronic elements for the FTZ exit. In the end, all 132 containers were released in two weeks.

Evans Logistics Inc., the brokerage division, arranged carriers for the outbound loads and scheduled pick-up and delivery appointments. “We provided detail for where the containers were headed and Evans booked all of the freight,” Stotsenburg says. “Evans made sure that the appointments were met and the deliveries were received on time and damage-free to our customer’s warehouses.”

Outcome: Communication & Partnership

All in all, Evans helped Kenda reach their key goals. They utilized an FTZ warehouse to legally avoid elevated duties. And they ensured their products made it to their customers, damage-free, at the least amount of cost to Kenda.

“This is just one project in a laundry list of other things that I’m coordinating. Evans’ communication and organization throughout the project was critical to getting the job done,” Stotsenburg says.

Are you in need of a full-service 3PL solution? Evans Distribution Systems loves to solve your logistical challenges. Discover for yourself why it’s easier with Evans. Tell us about your project or call 1-800-OK-EVANS.