Driving Efficiency and Cost Savings through Customs Warehousing

During the Covid pandemic, Bambino Mio experienced significant business growth due to Covid restrictions as well as increased awareness of the brand and its offerings. There was a substantial increase in the traditional flow of stock moving from Asia to the UK and then onward to Europe. However, once Brexit came into effect, new challenges emerged as warehouse stock levels and their associated values increased. Duty had to be paid on these higher stock levels at the UK border, which put pressure on the company's cash flow and other areas of the business.

Due to Bambino Mio’s large volume of products entering Europe, Brexit created a risk of double duties, once upon entry into the UK and again when goods were transported across European borders. At that time, no logistics provider offered indirect representation for imports or accepted the associated liabilities. As a result, the costs of doing business and navigating various customs regimes increased significantly. Although a free trade agreement (FTA) was in place between the UK and Europe, most of Bambino Mio’s products fell outside the scope of the established rules of origin agreement.

These challenges forced Bambino Mio to rethink its entire customs process. Previously, they had depended on logistics providers to manage their customs operations, which included handling customs clearance and clearing all goods into free circulation. This approach, while straightforward, became increasingly costly and inefficient post-Brexit.

To address these challenges, Bambino Mio began by analysing its logistics and stock flow into the UK and its sales flows into Europe. This analysis was a crucial first step in developing a strong business case for implementing a software solution designed to optimise their operations. The evaluation allowed them to assess the potential savings while considering the initial one-off implementation and ongoing management costs. Bambino Mio identified a compelling business case, with significant savings to be made by adopting a customs warehouse solution.

Bambino Mio adopted a phased approach to implementing CAS. They began with imports, the most straightforward part of the process, where CAS tracks all product stock, including both bonded goods and goods in free circulation. The second phase focused on exports, where the greatest cost savings were realised. Bambino Mio’s commercial system sends data directly to CAS to process the required export documentation.

Once Bambino Mio sends data to CAS, the system prioritises the removal of duty-suspended goods based on pre-set configuration rules. If no duty-suspended goods are available, it shifts to pick free-circulation goods. This approach ensures efficient handling of goods removals.

Many of Bambino Mio’s products are sold as bundles or kits, which combine multiple items into a single set. CAS breaks these bundles into individual products, ensuring that each item is correctly accounted for and its value accurately calculated and reported to HMRC. This streamlined approach not only improves compliance and operational efficiency but also delivers significant financial benefits. As a result, Bambino Mio achieves annual savings of between £80,000 to £100,000 per year.

"CAS offers us great flexibility by automatically removing the appropriate stock and lodging precise, efficient declarations with customs authorities. Beyond the efficiency gains, we save a substantial amount on customs duties and administrative costs, amounting to between £80,000 and £100,000 in bottom-line savings per year," said Rob Ormrod, Supply Chain Manager at Bambino Mio.

"To us, C4T was best in class in terms of customs automation and compliance. The software is continuously enhanced and updated to ensure it remains efficient and user-friendly, streamlining our day-to-day operations. What sets them apart is the exceptional support service, being highly responsive and proactive. The team provided invaluable assistance during the onboarding process, ensuring a smooth transition and helping us maximise the system's potential from day one," said Rob Ormrod, Supply Chain Manager at Bambino Mio.