Major American Companies Securing Cargo and Profits

The goal: to prevent bombs, biological weapons and security threats from reaching U.S. borders

Thousands of American companies are learning that doing the right thing for homeland security also can beef up the bottom line.

These firms -- Anheuser-Busch, Solutia, Boeing and Brown Shoe among them -- are protecting their imported goods as part of the Customs-Trade Partnership Against Terrorism, or C-TPAT. Begun in the wake of the 9/11 terrorist attacks, the voluntary program encourages companies to invest in the security of their shipping and supply systems -- or supply chains.

The goal is to prevent bombs, biological weapons and other security threats from reaching U.S. borders. The methods call for protecting cargo containers as they are loaded on foreign soil, using everything from high-tech sensors and locks, to employee education programs and background checks.

The program reduces pressure on U.S. Customs and Border Protection, which processes an average of 9 million truck-sized cargo containers arriving from overseas each year -- about 25,000 a day.

Since 9/11, Congress has increased the agency's funding by more than 700 percent, to $1.6 billion in fiscal 2005. Yet some politicians clamor for increased container inspections and say America's ports remain highly vulnerable.

Some of the country's biggest importers helped design C-TPAT and are encouraging their business partners to participate, saying this approach is better than government-imposed, mandatory measures.

"It's a positive program that came from the results of Sept. 11, that made the country more secure," said Dorsey Hunt, sales manager at Supply Chain Security Inc. of Ft. Lauderdale, Fla., which provides consulting services for companies seeking C-TPAT certification.

"It's important for where we are in the world today that companies understand who is playing with (their) supply chain," he said. "Companies have to get in the game."

To join C-TPAT, companies must submit details of their shipping activity and security measures, allow Customs to verify them and make suggested improvements. In return, their goods move faster through U.S. ports, are subject to fewer Customs inspections and get in the country first during a crisis that tightens borders, such as a natural disaster or terrorist activity.

These benefits -- plus advantages from keeping a close watch on imported supplies -- are saving companies money and improving their reliability and reputation, according to a recent Stanford University study, released by the Manufacturing Institute, the research arm of the National Association of Manufacturers.

Anheuser-Busch regards C-TPAT participation as "both good citizenship and good business," said Tim Armstrong, senior director of transportation and logistics services for the brewing company's domestic subsidiary.

"As we add imported beers like Harbin, Grolsch and Tiger to our distribution system, it's important that we avoid shipment delays and deliver fresh beer to our customers," he said. A-B also imports hops and other raw materials.

C-TPAT is leading to the development of technology to better protect cargo coming through U.S. ports. The Department of Defense website includes a 50-page "best practices" brochure that details some gizmos used by certified companies. These include "smart" seals; global positioning system tracking; radio frequency identification, or RFID, tags; and sensors that monitor and alert to changes in temperature, light, humidity and other conditions.

Boeing uses smart seals on its containers -- locks with serial numbers and manifest data that employees check when shipments arrive at the warehouse. Other adjustments include additional training for guards, but Boeing has not incurred any expenses worth mentioning since becoming C-TPAT certified in 2003, said Ken Konigsmark, the aerospace and defense giant's C-TPAT program manager.

Participating in the program gives Boeing a better grasp of its international supply chain at a "total company level," he said.

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