Hiding a Shipment from Import Genius

You may worry about services, such as Import Genius, which let users search vessel manifests for details about shipments including the names of suppliers. As an importer, how do you keep competitors from spying on you?

That’s the question which quality assurance specialist Renaud Anjoran takes up in a recent post on how importers can use a Hong Kong trading company for privacy. In a nutshell, this strategy involves setting up a company in Hong Kong to act as an intermediary between you and your Chinese suppliers, thus hiding details about them.

Such an arrangement may work well for big businesses, which have the resources to establish an elaborate supply chain. But for the small importer, this strategy would be a waste of time and energy. Fortunately there are much simpler and economical ways to tackle this problem — if indeed it is a problem in the first place.

So first ask yourself: is it really a problem that competitors know who your suppliers are? You may gain nothing by maintaining a veil of secrecy over your importing activities. After all, every industry is a village and there are likely only a handful of competent manufacturers in the world who can produce goods to your required specifications. It is likely that your competitors already know who your suppliers are just by looking at your products.

But if secrecy is a must, there is a simple way to make sure your company name does not appear on websites like Import Genius. All you have to do is ask your shipping agent to have the Bill of Lading made “to order” of your customs broker in the US. (Here is an example of how this kind of Bill of Lading turns up in Import Genius.) By doing so, you assure that your broker’s name — not yours — shows up in the online trade data. The total cost for this layer of privacy is exactly nothing. That’s a lot easier than setting up a company in Hong Kong.

Now if you really wish to maintain an intermediary between you and your supplier, there is nothing stopping you from incorporating a new company at home. Here I’m talking about creating a second, seemingly unrelated business with the sole purpose of bringing the goods into the US. In this scenario, your company, ABC Marketing Inc., would purchase its merchandise from XYZ Importing Inc. As a domestic sale, you have perfect privacy, so your competitors would never know that ABC was doing its buying through XYZ.

For a small or medium business, there really is no need to establish an intermediary in Hong Kong, so why would anybody do so? I suspect it has something to do with exporting profits, where they can be safely stashed in a Hong Kong bank account to avoid taxation.

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