Bonded Warehouse vs Non-bonded
Ever since the world became just one big market, Customs Bonded Warehousing has made life easy for traders. The option to safely store goods is a great advantage to both importers and exporters, especially when you are moving around very valuable goods.
\And when you delve deep into the world of warehousing and logistics, you are often met with two major choices – Bonded Warehouse and Non-bonded warehouse. What makes them different?
What Is A Bonded Warehouse
Customs bonded warehouse is a secure place to export-import or store goods. The importer has to pay the duties only when the goods are removed from the storage. The reason why we call it a “bonded” warehouse is because when the goods enter the bonded warehouse, the importer and the warehouse owner sign on a bonded agreement.
Bonded Warehouses are in place to encourage budding entrepreneurs to enter the import-export business. In March of 2020, the US imports stand at $232.2 Billion and exports at $187.7 Billion.
Most of the customs bonded warehouses are owned by the government, and many are privately owned as well. If a private storage space aims to become the custom bonded warehouse, the operator has to apply for being a certified import storage facility with the customs office.
To get approved, bonded warehouses have to designate a specific area for the storage of the goods and also prove the financial and operational integrity. Once approved, the bonded warehouse has to post a customs bond and agree to the various customs inspections.
What is A Non-Bonded Warehouse
A non-bonded warehouse is a storage space for goods on which the duty is already paid. They do not have a deferred payment model like bonded warehouses. These warehouses are supervised by the port authorities rather than customs authority.
The main reason why importers would choose Non-bonded Warehouse over a bonded warehouse is to use the goods in domestic markets, rather than to re-export.
The imported freight has to be approved and inspected by the customs, after which the goods can be delivered to a specific destination. In the non-bonded warehouse, the importer of the goods has to immediately pay the taxes and get the goods inspected, irrespective of their final destination. Customs bonded warehouses are sometimes managed by the customs officials, which facilitates the exporter to defer the payments until the goods are bought
A bonded warehouse is good for long term storage. In the US, the customer can go as long as five years without having to pay the duties. Many countries keep the storage periods set to infinity. When the customer stores for a long time, he/she avoids unnecessary travel, and this also allows them to develop good professional relationships with the most reliable vendors. In the case of the non-bonded warehouses, long term storage means additional cost, which is not a very convenient setup for businesses looking for long term storage plans.
Custom bonded warehouses save money. When the goods are stored in a bonded warehouse, the duties are deferred until the goods leave for the final destination. The importer can save a lot of money regardless of what he/she intends to do with the cargo. This also buys time to complete the legal framework, essential to export goods in a country. As compared to the non-bonded warehouses, importers can save up to 30% in terms of the deferred taxes.
Storing Restricted Goods
When it comes to non-bonded warehouses, the importers have a strict time limit, during which any restricted goods are held, and the paperwork has to be approved. Customs bonded warehouse, on the other hand, are exempted from this probationary period. This means that just like the duty deferment, it is more convenient to store the restricted goods for as long as 5 years, while the importer files all the required paperwork. Just to remind you again, it takes a lot of time to process the paperwork for restricted goods, and non-bonded warehouses do not allow that much time.
When you talk about the ease of shipping internationally, a custom bonded warehouse takes the lead. Any importer can import the goods across the globe and store them without having to pay an advance duty fee. This condition is suitable for two business scenarios. First, the goods can be stored in a bonded warehouse until there is a significant increase in the demand for the same. This is when the importer can pay the duties and get these demanded goods delivered to the destination within the country of holding. You do not have to import it all together. It can be done easily and at your convenience.
Secondly, the importer can keep on storing the goods at the custom bonded warehouse to process the consolidation of the assets. You can do all of this before going for the export again. Whenever the consolidated goods are moved from the country of the holding, the importer does not have to pay the duty fees because the goods have been staying under the supervision of the customs. This helps the importer avoid double taxes.
The Stress-Free Option Wins
Customs bonded warehouses are importer friendly. This stress-free option allows the importers to store their goods at ease, and the transportation of the goods is hassle-free too. Good are stored in a safe space with round the clock surveillance. The taxes and duties are deferred until the goods are on their way out of the facility. You do not have to rush to complete the paperwork, as you have got ample time to do it. There are no immediate requirements for any inspection, and the goods are good if you ought to store them at a stretch of years together when the demand is low.
This kind of facility is missing in the non-bonded warehouse. If you are delayed with the payments or the paperwork is incorrect for any reason, be it a genuine mistake, the stored goods are destructed.
Finding A Trustworthy Warehousing Partner.
At Pedraza Customs House Brokers, we offer bonded warehousing and transportation for imported goods. We make sure that the goods are inspected promptly, and they are kept in the safest environment. We will assist you with the quickest possible delivery.
All of our employees are TSA certified, and we are an approved bonded warehouse with round the clock surveillance. All thanks to our patrolled yards and top-notch security systems, you can ensure peace of mind. We have been in this trade for more than 15 years, and our top tier logistics service is going to make it all easy for you.