The average consumer isn’t particularly knowledgeable about what Foreign Trade Zones (FTZ) are – mention the topic, and most people think of the duty-free shops where they can pick up international goodies at a discount. But FTZs are actually an essential part of the U.S. economy, accounting for about one-fifth of the value of imports entering the country.
BMW’s plant in Spartanburg, S.C., manufactures more than 1,000 vehicles per day inside a foreign trade zone, employing American workers while exporting approximately 85% of their goods. President Obama’s 2010 National Export Initiative sought to double U.S. exports by 2014; so far, Foreign Trade Zones are the only slice of the import-export pie to achieve that goal.
Zone Solutions, headquartered in Indianapolis but doing business coast to coast, acts as the middle man between clients and governmental regulatory agencies. Under this managed services business model, they ensure compliance with customs laws and report all receipt and removal activity on behalf of the FTZ Operators.
Zone Solutions also assists businesses with cost-benefit analysis, FTZ application review, development, submission to the Foreign Trade Zones Board, and FTZ site activation. Their personnel utilize proprietary software to help manage the flow of information about goods moving through FTZs.
“A large portion of the program is accountability for merchandise, and systems play a very large role in that accountability. We ensure our customers’ inventory systems remain in sync with Foreign Trade Zone systems,” said Eva Tomlinson, Zone Solutions President & CEO.
Essentially, they help clients monitor the information and trade activity being communicated to US Customs and other regulatory agencies.
Founded in 2003, Zone Solutions started with a very select group of clientele, and has experienced tremendous growth – doubling revenues virtually every year. They’ve gone from two employees to 17, with plans to hire three more this year.
Tomlinson envisions continued growth in the coming years, but says their primary emphasis is on maintaining their high level of compliance in on-going operations, which helps Zone Solutions stand out from the crowd.
“We have experienced a great percentage of growth since we started. But given the nature of our business and the clients we work with, we have a philosophy of controlled growth. It is so important that the projects are implemented in a compliant manner, and that we have the checks and balances in place so they stay compliant,” she said.
“Our commitment is to excellence; that’s what we strive for. We build our policies and procedures around them.”
Their record speaks for itself: no Zone Solutions client has ever received a negative audit from regulatory agencies.
Tomlinson said Sponsel CPA Group has been instrumental in developing a long-term valuation strategy for the company. Their counsel has helped determine how to structure the business to realize the most advantage tax position possible. They also give guidance and advice on a variety of subjects to help them keep growing in the way they want.
“Sponsel CPA Group provides consulting as it relates to company structure, strategy from a tax perspective, and they also handle the corporate tax reporting on an annual basis,” she said.