SAP GTS stands for SAP Global Trade Services. It is a software application designed to manage international trade processes within a business.
The SAP Global Trade Services application helps automate and streamline trade processes so you can control costs, reduce the risk of penalties and fines, and clear customs faster. Essentially, it simplifies the complex requirements of cross-border trade by bringing various compliance and logistics functions into a single, integrated platform.
Why is SAP GTS Important?
In today's global economy, companies frequently import and export goods across international borders. This involves navigating a labyrinth of regulations, tariffs, and customs procedures that vary significantly by country. Failing to comply can lead to significant delays, hefty fines, and damage to a company's reputation.
SAP GTS addresses these challenges by providing tools that help businesses:
- Ensure Compliance: Stay up-to-date with ever-changing trade regulations worldwide.
- Manage Risk: Proactively identify and mitigate potential compliance violations.
- Optimize Operations: Automate manual tasks and accelerate customs clearance.
Key Capabilities of SAP GTS
SAP GTS offers a suite of modules that cover critical aspects of global trade management. Some core components include:
Compliance Management
This module helps businesses comply with legal regulations governing international trade.
- Sanctioned Party List Screening: Automatically check business partners against official restricted party lists (e.g., Denied Persons List, Specially Designated Nationals list) to prevent illegal transactions.
- Legal Control (Export/Import): Determine if licenses or other special requirements are needed for specific goods or destinations.
- Embargo Checks: Ensure transactions are not conducted with countries under trade embargos.
Customs Management
Facilitates interactions with customs authorities.
- Customs Declaration Processing: Automate the creation and submission of customs declarations.
- Customs Procedure Management: Handle various customs procedures like transit, inward processing, etc.
- Communication with Customs Authorities: Integrate with customs systems for electronic data interchange (EDI).
Risk Management
Helps manage financial and security risks associated with trade.
- Preference Management: Determine eligibility for preferential trade agreements (like NAFTA/USMCA, EU Free Trade Agreements) to potentially reduce or eliminate customs duties.
- Restitution Management: Handle processes related to claiming refunds or subsidies.
Trade Preference Example
Imagine a company in Germany exporting goods to Canada. Using SAP GTS Preference Management, the system can automatically check if the goods qualify for preferential treatment under the Canada-EU Comprehensive Economic and Trade Agreement (CETA). If they do, the necessary proof of origin can be generated, potentially lowering import duties for the Canadian customer and making the German company more competitive.
How SAP GTS Integrates
SAP GTS typically integrates tightly with core ERP systems like SAP S/4HANA or SAP ECC, as well as other relevant systems (e.g., warehouse management, transportation management). This integration ensures that trade data flows seamlessly throughout the supply chain process, from order creation to goods issue and customs clearance.
Integration Points:
| System | Data Exchanged | Benefit |
|---|---|---|
| SAP ERP | Sales Orders, Purchase Orders, Deliveries | Trigger compliance and customs checks |
| SAP TM | Freight Orders | Align trade documents with logistics |
| External Data | Sanctioned Party Lists, Tariff Data, Exchange Rates | Ensure accurate compliance and duties |
Benefits of Using SAP GTS
Implementing SAP GTS can yield significant benefits for companies involved in international trade:
- Reduced Compliance Risk: Minimizes the chances of costly penalties and disruptions due to non-compliance.
- Faster Customs Clearance: Streamlined processes and automated documentation accelerate the movement of goods across borders.
- Lower Costs: Optimizes duty payments through preference management and reduces administrative effort.
- Improved Efficiency: Automates manual tasks and provides a centralized platform for trade management.
- Enhanced Visibility: Provides a clear overview of global trade activities and compliance status.
In summary, SAP GTS is a vital tool for businesses operating internationally, helping them navigate the complexities of global trade efficiently and compliantly. Learn more about SAP solutions for global trade (example link).
