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Anybody who can solve fully international import and export customs regulatory compliance will be an easy multi-billionaire. The market size for international

Anybody who can solve fully international import and export customs regulatory compliance will be an easy multi-billionaire. The market size for international trade logistics is staggering...you have at least a hundred global logistics providers with market caps over $10B, and more than a handful of which are in the $>100B territory. And they have trillions in revenue combined. And they are in a capital intensive industry on low margins, and they dump tens of billions every year buying companies that can give them slightly better competitive advantages. And they ALL suck at regulatory compliance. But here is the bigger secret: The direct monetary cost of compliance isn't the big pain. What these companies pay for is delay reduction. Customs delays can drastically affect end-to-end SLAs, have a huge impact on customer loyalty (If your shitty compliance led to my product being held in port for a month, I will never use you again), and they have massive impacts on capital utilization due to how difficult it is to plan in the face of seemingly random customs delays. For an industry that is judged on Wall Street almost purely based on capital utilization (return on capital), you can bet your ass that every single one of those companies will be throwing as much money at you as they can.

meatysnapper 11y ago
A family friend runs a logistics analytics company and I'm always blown away by how complicated international shipping is. I feel like this would be an extremely complicated venture and it would not be the get rich quick scheme that VCs want and back more easily. You'd need dedicated people to go through stuff at individual major ports, speak the language, know all the people, etc. As you rightly point out, trust is paramount, and I think trust absolutely requires people on the ground.
- tim333 11y ago
  Not to mention that some places expect bribes if your stuff isn't going to get stuck for days.
- totalrobe 11y ago
  Right on point. There have been many software providers in this space for 20 years and none are wildly successful.
matrix 11y ago
Agreed, but it would be a difficult problem to solve. The technology part is straightforward. Things happen like shipping containers showing up on the docks without a proper cargo manifest or other documentation errors, which of course leads to the shipment sitting in customs until it gets sorted out. This is because the humans creating those forms often have poor tools, and of course there's the usual factors like staff who are too busy, incompetent, or lazy (in an ideal world they should not be doing that job, but this is reality we're dealing with). The obvious answer would be a shipping management system integrated with the company's supply chain software (typically, their ERP), but usually these problems are coming from OEMs, subsidiary companies, and occasionally 3PLs that have aren't part of the company's systems. Any integration with those systems is usually rudimentary at best, and it's not unusual for the "integration" to be human-based.
- ThomPete 11y ago
  And lets not forget the various unions for the ports who seem to be one of the major problems for shipping.
- shanecleveland 11y ago
  I could never find just the right form, so I made my own and put it out there for others: http://commercialinvoiceform.org http://commercialinvoiceform.org. Turns out a lot of people were looking for something like this.
thedogeye 11y ago
We started Flexport.com (YC W14) for exactly this reason. It's a very hard business but we've found that we're surrounded by boundless opportunity to solve important problems in every direction. Would love to connect to learn more about your experience and see if there's an opportunity to get you involved in some way. Email me: ryan@flexport.com
- meat_fist 11y ago
  My father just started a consulting company relating to logistics, he has 20 years experience in high volume transport. Would you be interested in speaking with him? I can shoot him an email to see if he'd be interested in working with you. Just a thought.
  - thedogeye 11y ago
    Sure, would love to meet your dad. Please intro.
- seanlinehan 11y ago
  Link: http://www.flexport.com http://www.flexport.com
- curiously 11y ago
  How did you convince carriers to partner with you? I'm asking because I work in a different niche and see potential companies that I would do wonders if we could have a mutually beneficial relationship but no idea how to approach it. Is it like enterprise selling? Btw that is another big question of its own
personjerry 11y ago
Can someone explain what "logistics" is? I've always just understood it as shipping and handling, and doesn't FedEx do that? (Therefore, I assume it's not shipping and handling)
- shanecleveland 11y ago
  Plainly – Getting stuff from one place to another. With international importing/exporting, it goes beyond "shipping and handling." How does it get from the warehouse to the port? Going by ocean or air? What taxes, duties, etc. are due at customs? How does it get from the receiving port to the final destination? Who arranges each step? Who pays for these things?
  - personjerry 11y ago
    Ah, okay. Why don't they just use FedEx then?
    - tim333 11y ago
      Have you seen FedEx's prices? I recently got a quote for a small packet from London to Tiblisi. From $109 + vat for the slow service.
    - shanecleveland 11y ago
      If you sold something on E-Bay to someone in China then, yes, you might just use FedEx. If you are exporting a container-load of apples that need to be refrigerated and arrive within two weeks, then there are a lot of "logistics" to figure out. FedEx may be able to do it – perhaps part of the equation – but there's likely faster and cheaper methods available. Figuring that out is logistics.
- hyperpape 11y ago
  As an example of how complex even FedEx can get, there are cases where it may make business sense to put a bunch of goods on a truck, drive n miles to a place where you'll get a better FedEx rate, and then ship from there (zone skipping).
romanixromanix 11y ago
Agree. And even more so when goods purchased with bitcoin have to pass customs.
totalrobe 11y ago
I'm at one of the few truly global trade (and compliance) management software providers, and frankly it isn't simple, it isn't cheap, and it isn't sexy. Some notes from my experiences: - Electronic source data is often unavailable - Each country has unique and often conflicting processes - Every company has unique and often conflicting processes - Every port has unique and often conflicting processes - Deployments of truly automated solutions are easily as complex as some ERP implementations - There are many cheap point solutions to compete with - Compliance heads are often more comfortable increasing headcount rather than buying software - Experienced compliance professionals are crucial to development - Experienced compliance professionals who understand and care about software are few and far between - Logistics and compliance professionals do not play nice - Very driven by the regulatory environment. Nobody wants to pay for compliance until they get fined. - You'll also be expected to interface with multiple government agencies, none of whom are overly concerned with your business success.
- hyperpape 11y ago
  What company, out of curiousity?
  - totalrobe 11y ago
    amber road
- Mandatum 11y ago
  There's a global move to create a standardized format amongst several EU, US and Asia-Pacific companies (and govt organisations) run by the International Parcel Corporation (http://www.ipc.be http://www.ipc.be). However the format they've created is already outdated (and it's taken three years to get to initial draft). Like most large parcel companies, they are catering for slow, technologically lagging suppliers and customers. It'll take a bleeding-edge integration partner like uShip, EasyPost or GoShippo to create a standardized format. (EDIT: Or the likes of Google who managed a similar outcome for addressing data with the Google Maps API.) This is really a field that large government bodies need to address seeing as most governments still have a large stake in parcel shipping.
curiously 11y ago
Not my start up but http://stage3systems.com/ http://stage3systems.com/ seems to do what you are asking or no? Are software like this common? I guess the tough part is 1. Acquiring Industry knowledge 2. Getting a sale 3. Developing the software
ianlevesque 11y ago
So with customs as he problem to be solved, you're suggesting smuggling as a startup. SaaS.

meatysnapper 11y ago

A family friend runs a logistics analytics company and I'm always blown away by how complicated international shipping is. I feel like this would be an extremely complicated venture and it would not be the get rich quick scheme that VCs want and back more easily. You'd need dedicated people to go through stuff at individual major ports, speak the language, know all the people, etc. As you rightly point out, trust is paramount, and I think trust absolutely requires people on the ground.

tim333 11y ago
Not to mention that some places expect bribes if your stuff isn't going to get stuck for days.
totalrobe 11y ago
Right on point. There have been many software providers in this space for 20 years and none are wildly successful.

matrix 11y ago

Agreed, but it would be a difficult problem to solve. The technology part is straightforward. Things happen like shipping containers showing up on the docks without a proper cargo manifest or other documentation errors, which of course leads to the shipment sitting in customs until it gets sorted out. This is because the humans creating those forms often have poor tools, and of course there's the usual factors like staff who are too busy, incompetent, or lazy (in an ideal world they should not be doing that job, but this is reality we're dealing with). The obvious answer would be a shipping management system integrated with the company's supply chain software (typically, their ERP), but usually these problems are coming from OEMs, subsidiary companies, and occasionally 3PLs that have aren't part of the company's systems. Any integration with those systems is usually rudimentary at best, and it's not unusual for the "integration" to be human-based.

ThomPete 11y ago
And lets not forget the various unions for the ports who seem to be one of the major problems for shipping.
shanecleveland 11y ago
I could never find just the right form, so I made my own and put it out there for others: http://commercialinvoiceform.org http://commercialinvoiceform.org. Turns out a lot of people were looking for something like this.

thedogeye 11y ago

We started Flexport.com (YC W14) for exactly this reason. It's a very hard business but we've found that we're surrounded by boundless opportunity to solve important problems in every direction. Would love to connect to learn more about your experience and see if there's an opportunity to get you involved in some way. Email me: ryan@flexport.com

meat_fist 11y ago
My father just started a consulting company relating to logistics, he has 20 years experience in high volume transport. Would you be interested in speaking with him? I can shoot him an email to see if he'd be interested in working with you. Just a thought.
- thedogeye 11y ago
  Sure, would love to meet your dad. Please intro.
seanlinehan 11y ago
Link: http://www.flexport.com http://www.flexport.com
curiously 11y ago
How did you convince carriers to partner with you? I'm asking because I work in a different niche and see potential companies that I would do wonders if we could have a mutually beneficial relationship but no idea how to approach it. Is it like enterprise selling? Btw that is another big question of its own

personjerry 11y ago

Can someone explain what "logistics" is? I've always just understood it as shipping and handling, and doesn't FedEx do that? (Therefore, I assume it's not shipping and handling)

shanecleveland 11y ago
Plainly – Getting stuff from one place to another. With international importing/exporting, it goes beyond "shipping and handling." How does it get from the warehouse to the port? Going by ocean or air? What taxes, duties, etc. are due at customs? How does it get from the receiving port to the final destination? Who arranges each step? Who pays for these things?
- personjerry 11y ago
  Ah, okay. Why don't they just use FedEx then?
  - tim333 11y ago
    Have you seen FedEx's prices? I recently got a quote for a small packet from London to Tiblisi. From $109 + vat for the slow service.
  - shanecleveland 11y ago
    If you sold something on E-Bay to someone in China then, yes, you might just use FedEx. If you are exporting a container-load of apples that need to be refrigerated and arrive within two weeks, then there are a lot of "logistics" to figure out. FedEx may be able to do it – perhaps part of the equation – but there's likely faster and cheaper methods available. Figuring that out is logistics.
hyperpape 11y ago
As an example of how complex even FedEx can get, there are cases where it may make business sense to put a bunch of goods on a truck, drive n miles to a place where you'll get a better FedEx rate, and then ship from there (zone skipping).

romanixromanix 11y ago

Agree. And even more so when goods purchased with bitcoin have to pass customs.

totalrobe 11y ago

I'm at one of the few truly global trade (and compliance) management software providers, and frankly it isn't simple, it isn't cheap, and it isn't sexy. Some notes from my experiences: - Electronic source data is often unavailable - Each country has unique and often conflicting processes - Every company has unique and often conflicting processes - Every port has unique and often conflicting processes - Deployments of truly automated solutions are easily as complex as some ERP implementations - There are many cheap point solutions to compete with - Compliance heads are often more comfortable increasing headcount rather than buying software - Experienced compliance professionals are crucial to development - Experienced compliance professionals who understand and care about software are few and far between - Logistics and compliance professionals do not play nice - Very driven by the regulatory environment. Nobody wants to pay for compliance until they get fined. - You'll also be expected to interface with multiple government agencies, none of whom are overly concerned with your business success.

hyperpape 11y ago
What company, out of curiousity?
- totalrobe 11y ago
  amber road
Mandatum 11y ago
There's a global move to create a standardized format amongst several EU, US and Asia-Pacific companies (and govt organisations) run by the International Parcel Corporation (http://www.ipc.be http://www.ipc.be). However the format they've created is already outdated (and it's taken three years to get to initial draft). Like most large parcel companies, they are catering for slow, technologically lagging suppliers and customers. It'll take a bleeding-edge integration partner like uShip, EasyPost or GoShippo to create a standardized format. (EDIT: Or the likes of Google who managed a similar outcome for addressing data with the Google Maps API.) This is really a field that large government bodies need to address seeing as most governments still have a large stake in parcel shipping.

curiously 11y ago

Not my start up but http://stage3systems.com/ http://stage3systems.com/ seems to do what you are asking or no? Are software like this common? I guess the tough part is 1. Acquiring Industry knowledge 2. Getting a sale 3. Developing the software

ianlevesque 11y ago

So with customs as he problem to be solved, you're suggesting smuggling as a startup. SaaS.