Supply Chain Performance
Supply Chain Performance

What is the Temporary Storage Warehouse or TSW?

In the complex world of logistics and international trade, there are several terms and concepts that are essential to ensure efficient supply chain management. One of them…

On June 23, 2023

In the complex world of logistics and international trade, there are several terms and concepts that are essential to ensure efficient supply chain management. One of them is the Temporary Storage Warehouse (TSW), a key piece in the customs process and the optimization of goods flows. FM Logistic – a global logistics operator is committed to providing solutions tailored to the changing needs of the industry. In this article, we will explore in detail what a Bonded Warehouse is and how this service, offered by FM Logistic, allows companies to keep their goods in a controlled and secure environment during the customs process, ensuring an agile and efficient management of their international operations. According to the Tax Agency, an TSW is a place authorized by the customs authorities to store goods.

What is a Temporary Storage Warehouse (TSW)?

In the world of logistics and transportation, an essential component in maintaining an efficient supply chain is the temporary storage warehouse. This type of warehouse plays a crucial role in the management of goods and allows companies to temporarily store their products in a secure and strategic location. A temporary storage warehouse is a space specifically designed to receive, store and temporarily manage goods before they are transported to their final destination. It is a versatile solution that adapts to a variety of needs, such as storage solutions for goods in transit, customs clearance, cargo consolidation and efficient product distribution.

TSW characteristics

A temporary storage warehouse has several key features that make it a reliable and efficient option for managing goods. Here are some of the most common features:

  • Strategic location: temporary storage warehouses are usually located near key points of entry and exit of goods, such as ports, airports or customs areas. This strategic location facilitates the rapid receipt, clearance and transport of goods.
  • Secure storage space: these warehouses are designed to ensure the safety of goods during temporary storage. They have security measures such as surveillance systems, access control and alarms to protect products from theft or damage.
  • Flexibility and adaptability: temporary storage warehouses must be flexible to adapt to changing business needs and customs regulations. They can adjust their storage capacity according to demand and offer customized services, such as packaging, labeling and product sorting.
  • Efficient inventory management: these warehouses are equipped with advanced inventory management systems and technologies that enable accurate tracking of goods. This facilitates the location and control of products, streamlining the inbound, outbound and customs clearance processes.
  • Customs compliance: a temporary storage facility must comply with national and international customs regulations and requirements. This implies having personnel trained in customs matters, adequate documentation systems, and clear procedures for customs clearance of goods.
  • Value-added services: in addition to temporary storage, these warehouses often offer additional services that add value to the supply chain, such as product labeling, load consolidation, picking and specialized packaging.

Why is it important?

A temporary storage warehouse is important for several key reasons:

  • Streamlines logistics processes: by providing specialized space for the temporary storage of goods, these warehouses enable more efficient management of products in transit. This reduces lead times, optimizes workflows and speeds up the overall supply chain.
  • Facilitates regulatory compliance: international trade involves compliance with specific customs regulations and standards. Temporary storage warehouses are designed to meet these requirements, facilitating customs clearance, document verification and compliance with customs regulations. This avoids delays, penalties or legal problems related to the transport of goods.
  • Enables cargo consolidation: these warehouses provide the opportunity to consolidate multiple shipments or products from different suppliers in one place. This optimizes storage space and reduces transportation costs by combining loads into a single shipment. It also facilitates logistics planning by having a central consolidation point.
  • Provides flexibility in inventory management: a temporary warehouse provides flexibility in inventory management by allowing companies to store products for varying periods of time. This is especially beneficial in situations where temporary storage is required due to seasonal fluctuations, changes in demand or distribution delays.
  • Improves operational efficiency: these warehouses are designed to optimize the supply chain by offering value-added services such as labeling, specialized packaging and product sorting. This enables faster and more efficient handling of goods, resulting in improved productivity and reduced errors or damage in the process.

Benefits of using an TSW

Temporary storage warehouses (TSW) offer a number of significant benefits for companies involved in international trade. These benefits include increased flexibility in supply chain management, optimization of operational costs and greater efficiency in customs processes. By using an TSW, companies can keep goods in a secure and controlled location while completing customs formalities, thus avoiding the need to pay duties and taxes ahead of time. In addition, TSW enable shipment consolidation, resulting in better space utilization and reduced warehousing costs. By having access to value-added services such as labeling, packaging and goods handling, companies can tailor and prepare their products according to specific market needs, improving competitiveness and delivery agility.

How does a Temporary Storage Warehouse work?

How long can the goods be stored in this type of warehouse?

In bonded warehouses, the duration of storage of goods may vary depending on customs requirements and regulations. Generally, goods are allowed to remain in this type of warehouse for a specific period of time, which is usually established by the customs authorities. This period provides importers and exporters with a margin to complete customs formalities and fulfill tax obligations before the goods are cleared or released.

Types of operations allowed in an TSW

An TSW temporary storage warehouse is an area authorized by the customs authorities to perform various operations related to international trade. Among the operations permitted in a TSW are the storage of imported or export goods, consolidation of cargo, deconsolidation of shipments, handling of goods, labeling and packaging, as well as the performance of value-added activities such as assembly, classification and labeling of products.

Who controls this type of warehouse?

Bonded warehouses are subject to strict control and supervision by the customs authorities of the country in which they are located. These authorities, which may be part of the national or regional customs administration, are responsible for ensuring compliance with customs regulations and acquiring the corresponding taxes and duties. In addition, they may carry out inspections, audits and constant surveillance to prevent illegal activities, thus ensuring compliance with current trade and customs regulations.

What happens when the storage expiration date approaches?

As the expiration date for storage in a Bonded Warehouse (TSW) approaches, it is crucial that importers or exporters take the necessary steps to avoid any mishaps. As the deadline approaches, it is important to comply with the following considerations:

  • Customs clearance: before the deadline expires, all necessary customs formalities for the stored goods must be completed. This may include the presentation of documents, payment of duties and taxes, and any other requirements established by the customs authorities.
  • Renewal or extension of storage: in some cases, it is possible to request a renewal or extension of the storage period. This may be necessary if more time is required to complete additional paperwork, resolve logistical problems or meet other legal requirements. However, this option is subject to approval by customs authorities and may be subject to additional charges.
  • Withdrawal or re-export of merchandise: if no action is taken before the expiration date, customs authorities may take action for the withdrawal or re-export of the stored merchandise. This may include the imposition of fines, seizure of the merchandise or any other action established in the customs legislation.

Duties of TSW

As to the duties of an TSW, these generally include:

  • Customs compliance: an TSW warehouse must comply with all customs regulations and procedures established by the competent authorities.
  • Record keeping: the TSW should maintain accurate records of all operations and transactions performed in the warehouse, including incoming and outgoing goods, customs documents, storage dates, among others.
  • Security and inventory control: the TSW is responsible for ensuring the security of stored goods and must have adequate security measures in place to prevent loss, damage or theft. In addition, inventory control must be maintained to ensure that goods are in good condition and available when required.
  • Collaboration with customs authorities: the TSW must cooperate and collaborate closely with customs authorities, providing access to facilities, providing information and responding to any request or requirement of the competent authorities.

It is important to note that the specific obligations of an TSW may vary according to the customs regulations of the country or region in which it is located.

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