Digitizing product classification and customs clearance: NKD
NKD automated their paper-based import processes with AEB customs management solutions, increasing speed and accuracy and ensuring customs compliance.
Challenge
The import process isn’t just a walk in the park for NKD. The clothing retailer files more than 7,000 individual customs declarations per year and the majority of NKD’s articles are limited runs that are only included in their collection once. Core or “never out of stock” items account for only a small percentage of their collection.
Due to the constantly changing stock, NKD’s product classification efforts are exceptionally time consuming and resource intensive. If a product is reintroduced, there is no simple way to recognize it, so the classification process must be repeated. In addition, NKD often assigns commodity codes to articles before production. However, if the commodity code changes prior to import, this can pose compliance risk.
With AEB’s customs management platform, NKD has now automated and digitized their paper-based import process, from classification through customs clearance. Instead of printing out documents, filling them out, and manually inputting the import declaration information into the system for electronic filing, the entire process is now carried out on AEB’s cloud-based platform. This digitization has laid the foundation for further optimizations.
For Andreas Hofmann, Head of Inbound Logistics and Customs at NKD, one feature has proven particularly important. “Thanks to the digitized process, we avoid input errors and can calculate rates faster and more reliably. For us, the game changer is clearly the automated recognition and assignment of commodity codes for articles that we have imported in the past. That was not possible with our old process.”
This feature eliminates unnecessary rework by matching items that have the same commodity code as previously imported products with AEB’s “search-as-you-type” functionality. Using artificial intelligence (AI), the software compares item master data, recognizes matching past products, and automatically assigns the same commodity code, product description, and any other details required for the import declaration.
In addition, products that are subject to a full tariff can be held until the statutory deadline. If there are changes to the commodity code, the system will notify users prior to import so it can be rectified.
Result
NKD can now classify goods and calculate tariffs faster, more securely, and more efficiently. Centralizing the storage of all relevant data on AEB’s cloud-based customs management platform allows for immediate access to data at any time, from any location. Digitized processes have eliminated routine tasks for the NKD customs team, allowing them to execute customs processes more efficiently.
Human error from the manual input of data has been completely eliminated and updates are automatically sent if the commodity code changes for items that are being held.
AEB’s platform has reduced time spent on customs management efforts and given NKD confidence that their processes are compliant. Thanks to the integrated AI that learns from NKD data, efficiency and data accuracy improve with each classification.
“The modular system allowed us to assemble exactly the functionality we needed. If we face new challenges in the future, additional functionality can be added to our production environment at any time."
Andreas Hofmann Head of Inbound Logistics and Customs, NKD
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About NKD Group
NKD is one of the largest companies in the textile retail sector, with more than 2,200 physical locations across Germany, Austria, Italy, Slovenia, the Czech Republic, Croatia, and Poland, plus a robust online marketplace. It employs 10,000 employees internationally, offering current fashion collections for the whole family along with functional sportswear, home textiles, and seasonal decorative items.