Customs brokers are licensed by the United States Government. Brokers assist importers by facilitating the clearance of goods before they enter the country. A licensed customs broker can act as an individual or as a company to conduct customs business on the behalf of an importer . As of February 2010, U.S. Customs and Border Protection reports the United States has an estimated 11,000 active customs brokers.
For security reasons, U.S. Customs and Border Protection is highly selective in determining who is granted a customs broker license. Only those that customs determines do not pose a security threat and prove to have a thorough understanding of import procedures and requirements are granted a license.
Eligibility Criteria to Obtain a Customs Broker License
An individual must meet certain eligibility criteria before becoming a licensed customs broker. First, the person must be a citizen of the United States and meet the minimum age requirement of 21 years old. Second, current employees of the federal government are not allowed to apply. The last eligibility requirement is that the applicant must have good moral character as determined by Customs and Border Protection.
SCHOOL SUBJECTS
Business, Foreign language, Mathematics
PERSONAL SKILLS
Helping/teaching, Leadership/management
WORK ENVIRONMENT
Primarily indoors, Primarily multiple locations
MINIMUM EDUCATION LEVEL
Bachelor’s degree
SALARY RANGE
$19,000 to $50,000 to $115,430+
CERTIFICATION OR LICENSING
Required by all states
■ OVERVIEW
Export-import specialists plan and coordinate business transactions involving importing from or exporting goods to foreign countries. They may work for the government, an international company, or as a representative of an individual client. Export-import specialists are involved in various aspects of foreign trade, from negotiating trade agreements to planning and supervising the actual delivery of goods.
■ HISTORY
Exporting and importing is more than the flow of goods between different countries. Taken as a whole, what a country exports and imports largely determines its economic health. Trade relations have also been a major force in determining whether two nations are allies or enemies. During the expansion of the Roman Empire, for example, there was much trade between the Far East and Europe. In the 15th and 16th centuries, explorers such as Christopher Columbus, Vasco da Gama, and Ferdinand Magellan undertook long voyages to open new trade routes. Importing foreign goods allowed the people of a country to enjoy products not available in their own country. The early North American colonists traded products or raw materials, such as tobacco and furs, for clothes and other manufactured goods from England.
The people who facilitate the actual trading of finished goods, raw materials, and services are a varied group. In colonial times, a trader was basically anyone with the means of transporting or receiving and distributing goods. Thus, the owner of a ship that made the long voyage between America and England was a trader. So was the owner of a general store in America who bought the clothes and dry goods from other countries and sold them in his store. As America grew, so did the volume of goods it produced for trade. The fertile new country allowed farmers to grow enough crops to feed its own citizens as well as to trade with less fertile countries. Huge barges of grain moved down the Mississippi River to the Gulf of Mexico to be traded.
America is a comparatively rich country and its consumers demand a huge variety of products that make large profits for today’s importers. But before the 1940s, the United States had a largely protectionist approach to foreign trade, meaning that the government enforced high tariffs and rigorous import restrictions to protect home market producers from overseas competition. In the 1960s, the United States experienced an erosion of its dominant position in world trade, and in most of the years after 1970; it has reported a negative trade balance (more imports than exports). During the past several years, the U.S. trade deficit reached an all-time high as economic crises in other countries caused exports of everything from soybeans to automobiles to decline. No other developed nation has had such a large difference between exports and imports. Canada, lapan, and the European Union have all experienced an export growth greater than import growth. Because of this imbalance, the United States is keenly interested in either expanding the export of American goods or controlling the import of foreign goods.
Today, protectionism is not as popular as a free trade approach, whose proponents favor open markets and economic interdependence. In a move toward more free trade, President Clinton signed two agreements in 1993. The North American Free Trade Agreement (NAFTA) is a pact between the United States, Canada, and Mexico. Some of its provisions include the elimination of all tariffs over the next 15 years on goods produced and sold in North America, the barring of governments from imposing special requirements on foreign investors, and the lifting of certain restrictions on services, such as banking, telecommunications, and transportation. The second pact, the General Agreement on Tariffs and Trade (GATT), was approved by the U.S. Congress and the governments of 116 other participants. It reduces international trade barriers, including tariffs, import quotas, and export subsidies. NAFTA and a proposed FTAA (Free Trade Area of the Americas) agreement have come under fire from protesters, including labor, small farmers, and environmental concerns. They say the agreements allow large corporations to bypass environmental and worker protection laws and take business and jobs from average workers to concentrate power in the hands of a few corporate giants. Many countries fear that economic globalization will cause them to lose their economic independence as well as their social and cultural identities. In addition, the increasingly rapid loss of American jobs to other countries has raised additional concerns about free trade.
Experts cannot agree on whether such open trade policies have helped or hurt the United States. Familiar terms such as trade deficit or balance of trade are reported daily in the news. The U.S. trade deficit continues to grow, but at the same time, U.S. exports account for more than one-third of U.S. economic growth, according to the National Association of Manufacturers. The growth of foreign business and its importance to the national economy has created a need for specialists who can handle the complex problems of international business.
■ THE JOB
A variety of professionals are involved in the export-import industry. Some are involved only with the importing of raw materials or finished goods, while others are only involved with exporting. Many specialists, however, are involved in both the importing and exporting of foreign trade. All specialists must understand international law and be aware of export-import regulations, such as duty fees, but specific responsibilities vary according to the area of specialization.
Export managers direct foreign sales activities, including negotiating sales and distribution contracts and arranging payment for exported goods. They handle details involved in the transportation of goods, including licensing agreements, customs declarations, and packing and shipping. Export managers work with foreign buyers, federal agents, and company executives to coordinate shipping, airfreight, and other transportation methods. They also supervise clerical staff in preparing foreign correspondence and other foreign language material, such as sales literature and bid requests, meant to expedite foreign trade.
Customs brokers act as intermediaries between importers and the customs service. They prepare entry papers for goods arriving from abroad. They file appropriate documents to allow delivery of foreign goods and to assess import duties and taxes. Customs brokers must be familiar with more than 500 pages of customs regulations and thousands of tariff items. They must determine proper classifications of dutiable value and know which goods are subject to quotas. They may also help importers find the best routes for shipment. Customs brokers act as troubleshooters between importers and the federal government, counseling importers on relevant rules and regulations, working out any last-minute problems, and arranging for storage of goods in warehouses, if necessary. They may be in regular contact with more than 40 government agencies, such as the U.S. Department of Agriculture on meat import questions or the Consumer Product Safety Commission on product safety.
Import-export agents are independent contractors who usually work for several clients. They manage activities of import-export firms, coordinating settlements between foreign and domestic buyers and sellers. They plan delivery of goods and supervise workers in the shipping and receiving departments. Import-export agents act as trade representatives throughout the freight handling process. They oversee the assessment of import and export taxes and the granting of entry permits. They also resolve any concerns on the part of customs officials or foreign or domestic business people.
Freight forwarders act as agents for exporters in moving cargo to overseas destinations. They are familiar with the import rules and regulations of foreign countries, methods of shipping, U.S. government export regulations, special packaging or handling restrictions, hazardous materials rules, and the documents connected with foreign trade. Freight forwarders advise clients on freight costs, port charges, consular fees, cost of special documentation, and insurance costs. Forwarders find the most appropriate services so that products are moved by the most timely and cost-effective methods, making arrangements for storage, pick-and-pack operations, consolidations or full-container movements, as well as inland transportation. They also assist with initial quotations, prepare invoices, and bank clients’ documents for collection.
■ REQUIREMENTS
High School
To prepare for this career take college-preparatory classes, such as English, social studies, geography, and mathematics. Developing a fluency in a foreign language, especially one that is widely used in international trade, such as Japanese, Russian, or German, is very important.
Postsecondary Training
A college degree is becoming more important in the export-import field. Specific degree programs depend on the type of job desired, but in general undergraduate degrees in business management, political science, or economics are helpful. Coursework should include classes in international trade, marketing, business administration, communications, computer applications, and statistics. Many people who want management positions in the export-import field are now deciding to get a master’s in business administration (MBA), with an emphasis in international trade.
Certification or Licensing
Customs brokers must be licensed by U.S. Customs and Border Protection. The licensing process requires passing a written examination that covers export-import rules and regulations. Specifics on the licensing procedures are available from U.S. Customs & Border Protection. Ocean freight forwarders are licensed by the Federal Maritime Commission, and international air cargo agents are accredited by the International Air Transportation Association. Exporters of military equipment, nuclear fissionable materials, and some other items must have a license from the U.S. Department of Commerce.
The National Customs Brokers & Forwarders Association of America (NCBFAA) offers professional-level certification for ocean freight forwarders. To become certified, a candidate must have a minimum of three years forwarding experience and pass an exam. Candidates who meet these criteria may use the certified ocean forwarder (COF) designation.
The NCBFAA also offers the following technical-level certifications to workers in the export/import industry: Cargo Transportation Basics, Regulation of U.S. Exports, U.S. Export Clearance, Export/Import Transactions, Ocean and Through Intermodal Transportation, Cargo Security and Insurance, and Ocean Freight Forwarding. These certifications break down the diverse body of knowledge in the COF program into more specialized segments.
Other Requirements
To be a successful export-import specialist, you should be able to analyze purchasing decisions and evaluate products being shipped. You should have good verbal and written communications skills and be able to work well with other people. The ability to speak one or more foreign languages will help you to communicate far more effectively with trading partners and other foreign representatives.
■ EXPLORING
You may be able to find part-time or summer employment in a large store or other retail establishment, which will provide helpful insight into a merchandising career. After graduating from high school, an internship with an international company will give you valuable exposure to the export-import field. Discussions with professionals already working in the field are an excellent way to learn about career opportunities. Freight forwarders are among the best sources of information and assistance on U.S. export regulations and documentation, shipping methods, and foreign import regulations. In addition, to familiarize yourself with the field, pay attention to news reports on the U.S. trade balance, trade policies, and export and import levels of major goods, such as automobiles.
■ EMPLOYERS
The largest employers of export and import specialists are oil companies, manufacturers, trading companies, shipping firms, worldwide freight forwarders, airlines, warehouse firms, trucking firms, banks, agricultural-product producers, and department store chains. Major trade cities are New York, Miami, Boston, New Orleans, Chicago, Houston, Philadelphia, Seattle, Tacoma, San Francisco, Oakland, and Los Angeles.
■ STARTING OUT
The vast majority of entry-level positions are now reserved for college graduates, most of whom secure their first position by applying directly to the U.S. Customs & Border Protection, individual seaports and airports, international trading companies, and other organizations that hire export-import specialists. Public and private employment services may also refer qualified applicants to suitable entry positions. People with a master’s in business administration and a fluency in one or more foreign languages will have the best opportunities in this field.
■ ADVANCEMENT
Those in the export-import field usually have constant contact with other international firms and government agencies and therefore have frequent opportunities to switch employers. Specific advancement opportunities depend to some extent on the specialty within the field and vary greatly depending on the skill and drive of the individual.
An experienced export manager may become the marketing manager or vice president in charge of coordinating overseas distribution. Customs brokers may become export managers or maybe promoted to other positions within the export-import department of a company. After developing contacts and sales expertise, wholesalers may also become management consultants or start their own export-import firm. Import-export agents may become sales representatives for other export-import firms or go into business for themselves.
■ EARNINGS
Earnings vary widely depending on specific job responsibilities and the size of the export-import firm. According to the U.S. Department of Labor, median annual earnings of sales representatives, wholesale and manufacturing for technical and scientific products, were $60,760, including commission, in 2005. Salaries ranged from less than $31,510 for the lowest paid 10 percent to more than $115,430 for a year for the highest paid 10 percent. Median annual earnings of sales representatives, wholesale and manufacturing for nontechnical products was $47,380, with the lowest paid 10 percent earning less than $24,930, and the highest paid 10 percent earning over $96,050 a year. Some companies adjust salaries to reflect total volume of sales. Other companies pay straight commission (usually about 10 percent of total sales), while others pay a combination of salary, commission, and benefits. While wholesalers can make huge amounts of money, a slow period could adversely affect their earning potential. Buyers, the professionals who seek the best deal on raw materials and finished products for their employers, earned a median income of $42,870 in 2005, according to the U.S. Department of Labor. Salaries ranged from less than $24,900 for the lowest paid 10 percent to more than $80,330 a year for the highest paid 10 percent.
Customs brokers and freight forwarders are paid according to the amount of foreign trade they handle. Beginning brokers can expect to earn $19,000 to $24,000 per year, and experienced brokers earn over $35,000 per year. The U.S. Department of Labor estimates that the median wage for cargo and freight agents was $35,860 in 2005, with the lowest paid 10 percent earning less than $21,630 a year, and the highest paid 10 percent earning a more than $56,130 per year.
■ WORK ENVIRONMENT
Export-import specialists usually work in comfortable offices or customs buildings. They generally work a 40-hour week, although long hours may be required to negotiate a trade agreement or to plan and coordinate delivery of goods. Evening and weekend work may be necessary at times.
There may be a lot of travel, especially for wholesalers and those stationed overseas. These employees must adapt to the living and working conditions of the host country and should be aware of, and sensitive to, cultural differences in these countries. Some specialists, however, stay in one city and never travel abroad.
■ OUTLOOK
Opportunities in the export-import field should grow at an average rate through the next 10 years. Employment stability in this field is largely dependent on general economic conditions, and job prospects will vary from industry to industry and firm to firm. For example, it may be harder to find work as a textile wholesaler representing a U.S. firm than as a computer wholesaler.
The United States is the largest trading nation in the world and the agreements enacted in the 1990s to encourage a free-trade policy should help create some new work in the field. The U.S. trade deficit, however, continues to widen and imports are rising at a faster rate than the Gross Domestic Product.
