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SAP solutions for customs and foreign trade

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International trade requires special processes: You need to collect and maintain receipts, correctly tariff and take customs laws into account. These special requirements can be mapped with the help of software solutions. With Global Trade Services (GTS), SAP has a solution in its program that was developed specifically for this purpose. Those who want to use less extensive systems can also use the functions included in the ERP system. In this article, we explain which different solutions are available, which functions are supported in each case and which solution is the right one for which requirement.

Table of contents

Customs clearance, origin of goods & preferences, intra-Community processes, tariff classification or trade compliance: the responsibilities of customs officers are wide-ranging. Preferential processing, for example, involves accurate document management that proves the origin of all components of the goods. This enables goods to be sold to customers outside the EU at reduced rates of duty.

Those who carry out this or other foreign trade processes without software assistance risk errors and thus legal and economic consequences. SAP has no less than three possible solutions to support these processes, the integrated functions of either SAP ECC or S/4HANA, or the standalone SAP GTS.

1. SAP ECC Foreign Trade

As the name suggests, Foreign Trade is the term for the foreign trade component within SAP ERP. These functions are integrated with Materials Management (MM) for imports and Sales and Distribution (SD) for exports. Document management for this area is also closely linked to the Financials component.

According to SAP, the following functions are included with Foreign Trade:

  • Use of all import and export processes and efficient integration into the logistics chain
  • Automatic verification of export licenses based on current regulations
  • Simplify reporting with automated procedures for creating, printing, and submitting reports
  • Identification of products for preference processing
  • Efficient handling of business processes through EDI communication
  • Foreign trade data can be called up in all relevant SAP components (before goods issue); even after posting the goods issue, data can still be changed in the invoice

 

Who benefits from foreign trade?

Basic functions for international goods traffic are included in the FT module. If you only need to map a few special processes, this variant will get you quite far. With the help of customizing or Z programs, the module can be individually adapted and is thus sufficient for many requirements.

Especially when international trade is not the focus of the business model, the Foreign Trade Module provides sufficient security for customs regulations.

The big problem arises from the end of maintenance for SAP ECC: SAP's support for the ERP solution ends in 2027 (or 2030 with extended maintenance). The majority of companies are planning to switch to S/4HANA. With the end of SAP ECC, however, Foreign Trade is also history.

2. SAP S/4HANA International Trade

SAP S/4HANA does not include Foreign Trade. However, the ERP successor also contains functions for processing international goods movements. These are grouped together under the term International Trade. Compared with the scope of functions in Foreign Trade, however, this is significantly smaller. Above all, support for preference processing, which was still included in Foreign Trade, is missing.

The following functions are available in International Trade:

  • Intrastat
  • Tariffing and classification
  • Legal control for purchase orders, orders and deliveries
  • Letter of credit (as part of the FI component)

 

Who benefits from International Trade?

As mentioned above, companies that have previously relied on Foreign Trade should definitely check whether the successor system really supports all the processes that are needed before switching to S/4HANA. Those who have previously managed without digitized foreign trade processes and now want to take the first steps in this direction under S/4HANA can take advantage of the functions of International Trade.

However, the rudimentary functions of the integrated module are only very marginally supported if import and export form an important part of the company. Especially the risk due to the missing preference processing will be a reason for many companies to look at alternative solutions.

3. SAP GTS

SAP GTS is a comprehensive system that offers a very complete range of functions for customs and foreign trade. The clear advantage is that the fully automated and digitized processing of export and import transactions creates significantly more transparency, legal security and profitability. SAP GTS is the only SAP solution that covers all aspects of secure customs and foreign trade processing.

The following functions belong to the SAP GTS modules:

Customs Management

  • Export
  • Import
  • Transit procedure
  • Pricing
  • Excise tax

 

Compliance management

  • Sanctions list check
  • Embargo check
  • Legal control
  • Classification

Risk management

  • Supplier declarations
  • Preference determination
  • Export refund
  • Letter of credit

Intra-EU Supplies

  • Intrastat

Which versions of SAP GTS are available?

The first version of SAP GTS was launched in 2002. The current version is number 11.0 and the maintenance period for this solution ends in 2025. In addition, the successor version, a special Global Trade Services edition for SAP HANA, has been available since 2020. As the name suggests, this is specifically geared to the HANA database. SAP GTS, edition for SAP HANA is fully compatible with both SAP ECC and SAP S/4HANA.

The difference between these versions is not so much the scope of functions. Only the topic of letters of credit is not included in the e/4HANA edition, as this is already available as an integrated function in International Trade of the S/4HANA system. Adapted from S/4, however, it offers other benefits, such as the use of Fiori apps or analytics functions.

For whom is SAP GTS suitable?

SAP GTS is a comprehensive system, which is accordingly worthwhile if users require this support on a large scale. The more your company is internationally positioned and has to move goods internationally, the more likely you are to benefit from investing in the SAP GTS license.

Especially when you look at the limited functions of International Trade, there are good reasons to rather rely on the comprehensive system. This concerns

  • Industries where preference processing is an important factor for your competitiveness
  • Companies that have special requirements for their compliance management
  • Companies that primarily engage in international trade outside the EU

 

Whitepaper: Mapping New Processes in SAP GTS - What Users Need to Consider

A new plant abroad, new legal regulations or the need to finally automate processes: Time and again, users of SAP Global Trade Services (GTS) are faced with the challenge of mapping changes in their GTS system as well as the connected upstream systems. What you should pay attention to varies greatly depending on the task area in which you have new requirements. This white paper summarizes what you should deal with and which questions you need to ask yourself in advance.

Alternatives to SAP GTS

Companies that do not need the full range of GTS functions, or for whom these functions do not justify the investment in SAP GTS, nevertheless do not have to limit themselves to the narrow scope of International Trade. SAP enhancements can support the processes needed, while offering even more benefits:

  • Full integration in SAP, no media breaks
  • Quick and easy to integrate
  • Reduced risk of error
  • Legal certainty thanks to high transparency and end-to-end processes

 

The most obvious advantage is that you can usually select the processes and functions you need. This means that you only have to invest in add-ons that you actually need, instead of buying a fully comprehensive SAP license.

Whitepaper: Preferential processing in customs/foreign trade

Which processes are covered by SAP ERP and S/4HANA and which are not?

This white paper examines the challenges and opportunities of automating processes with SAP. Compared to manual activities, automation helps to minimize errors and implement many work steps much more efficiently. Companies that want to use an SAP-based solution but not GTS cannot avoid add-ons. When selecting them, you should make sure that the solution covers both worlds - SAP ERP and S/4HANA - equally well.

4. overview table

A direct comparison of the different solutions for foreign trade processing with SAP

SAP ERP
Foreign-Trade (FT)
S/HANA
for international Trade
SAP Global
Trade Services (GTS)
SAP-based
Add-on AVENIO
Customs Management
Export 039-cancel 039-cancel 045-check mark 045-check mark
Import (free circulation, special procedures) 039-cancel 039-cancel 045-check mark 045-check mark
Transit procedure 039-cancel 039-cancel 045-check mark 045-check mark
Pricing 039-cancel 039-cancel 045-check mark 045-check mark
Excise tax 039-cancel 039-cancel 045-check mark 039-cancel
Compliance management
Sanctions list check 039-cancel 039-cancel 045-check mark 045-check mark
Legal control
(export control, dual use goods, embargoes)
045-check mark 045-check mark 045-check mark 045-check mark
Classification 045-check mark 039-cancel 045-check mark 045-check mark
SAP ERP
Foreign-Trade (FT)
S/HANA
for international Trade
SAP Global
Trade Services (GTS)
SAP-based
Add-on AVENIO
Risk management
Supplier declarations 045-check mark 039-cancel 045-check mark 045-check mark
Preference determination 045-check mark 039-cancel 045-check mark 045-check mark
Export refund 039-cancel 039-cancel 045-check mark 039-cancel
Letter of credit 039-cancel 039-cancel 045-check mark 039-cancel
Intra-EU Supplies
Intrastat 045-check mark 045-check mark 045-check mark 039-cancel
Confirmation of Arrival 039-cancel 039-cancel 039-cancel 045-check mark
Sales tax ID number check 039-cancel 039-cancel 039-cancel 045-check mark

(The letter of credit function is found under SAP S/4HANA in the FI area. In GTS edition for SAP HANA, this function is therefore omitted, whereas it was still included in version 11.0).

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