WEBVTT
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Hey, welcome back to another episode of the Decoding Cross Border E-Commerce Podcast.
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Today, uh, we're gonna do a deep dive on product identifiers.
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And look, I don't know a lot about the product identifiers, so I'm gonna be asking a lot of questions.
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I'm excited about that.
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So today we have uh Jonathan Sullivan, our chief data scientist with us.
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Uh welcome to the welcome back to the podcast, Jonathan.
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Thanks for having me back, Clint.
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Yeah.
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And then uh as always, we have Aaron, you know, who will uh come up with a joke for us at some point, but it'll be at right at the right time.
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I don't know what's gonna be.
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He's always prepared.
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Just here to do my part, Clint.
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Yep, good.
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All right, so these are gonna become required November 1st into Europe, right?
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Product identifiers.
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That's correct.
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Why?
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Why are why why is why is this even a thing?
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And it's apparently just in Europe right now.
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There isn't like another country that's doing something similar.
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So let's go a little bit into the why.
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Jonathan, tell me a little bit about the why and then what as well, right?
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Like feel free to dive into that too, like exactly what it is.
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And because more I I mean, I just to we're kind of talking to the retailer right now, right?
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I want to make sure that they understand what their obligations are.
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So as you kind of frame it, be keep them in mind.
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Yeah, absolutely.
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So this all came out as part of the uh um EU customs reform that included the elimination of the de minimis, the introduction of the three euro um fee for every every uh low-value package coming in.
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And as part of a broader global trend for increased visibility on on e-commerce um low-value uh shipments coming into the market.
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Well, what kind of visibility do they want?
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Yeah, so that's a great, great, great question.
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So there's there's two primary objectives generally.
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Um one is for increased revenue collection, right?
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That's what we saw come into effect earlier this year.
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So a standardized number would help them possibly Yeah, no.
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Um so uh if you look at the the the actual reform, um the that that is specifically the three euro uh fee that was added, right?
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Uh-huh.
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Uh where the product identifiers come in is there is probably solving the second problem um within that, which is visibility into what is coming into the market, particularly so that they can enforce their um own uh regulations and rules and restrictions about what comes in.
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Um and and the changes in July for the three euro, that was just that's really just removing the duty to minimum us and put a simplified thing in place there.
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That was really just for low value shipments under 150 euro.
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But this product identifier impacts e-commerce shipments from all of all values, correct?
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Exactly, exactly.
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But it's really trying to get at the same problem of we don't have enough money and we don't have enough data visibility into what's coming in globally.
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This visibility problem has been an issue for all goods, not just for low value goods for the hold on, hold on.
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Why is there a problem?
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Yeah, you've you see a ton of data.
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Those descriptions in e-commerce are absolutely perfect in being able to identify the type of goods coming into a country, right?
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In in some cases they are rich.
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However, in many times, those get filtered through many parties before they actually get on to the to the regulators, to the customs authorities in market.
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Um so while there might be some uh maybe a lot of these that have rich information, um not uh it rarely makes it down to the to the entry.
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But even if you look at the at what's on the product listing, there's a lot of unbranded items, a lot of things that are being sold by um you know secondhand sellers that are you know don't clearly distinguish what exactly this product is.
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And if you're a regulator, it would make it really difficult for you to be able to say, yes, this it does or does not meet the requirements we've set forward.
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And I'm assuming one of these objectives too is to be able to actually run statistics and analysis, group entries, see how much of a particular product's coming in, and when you're trying to match on just a string of text that's coming from who knows how many different sellers, yeah, it it's there's it's impossible, right?
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And a lot of that text gets simplified and reduced.
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It might be like um uh animal toy.
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And is that a a toy that's shaped like an animal, or is that a a toy meant to be played with by your pet, right?
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Yeah.
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So there's a lot of ambiguity there as well.
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And and even if there were rich descriptions, a lot of times that rich description is specific to the retailer.
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And you know, sometimes we'll we'll see descriptions have the part numbered in the description, you know, because we're we're we uh we do customs brokerage, and so we see a lot of that, and you need to kind of extrapolate.
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It's very, very difficult if you don't have something something standard.
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Okay, so there's gonna be these standard identifiers that are required.
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Um and anything else uh that uh on the why you think that that's important, maybe before we go into the details of what these are?
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Yeah, uh specifically uh uh and if I'll I'll quote the EU commission.
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They say the new product identifier requirement will allow customs to obtain and use operational and supply chain traceability information to facilitate the identification on non-compliant goods, uh thereby scaling up the outcome of the control of an individual product to all products that present a similar risk.
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So it's really it's about security and it's about supply chain tracing.
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So those two.
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So what are these identifiers?
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Or identifier?
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How many how many are here?
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But wait, before we go into this, so the whole purpose is to catch non-compliant products coming in.
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Because I do think consumer safety is is a big part of this, a big driving factor, but they want to understand what's coming in and they want to be able to catch the stuff that's not supposed to come in, which reminds me of something that I did.
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You see the weather uh recently where there's there was fog everywhere, and I went out and I tried to catch the fog, kind of like these guys are trying to catch the bad guys, but I missed.
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Oh okay.
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On that note, let's dive into you know, sound sounds like the product identifiers are going to help them more explicitly group products, match products, catch non-compliant products, right?
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Correct, yep.
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And so there's three product identifiers specifically that the EU commission is asking for.
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Uh, the first, and this should be really simple for the vast majority of merchants, and that's their verbiage that they use merchants, the sellers, the shippers, uh, to use and to get.
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And that is the merchant product ID.
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The uh it's abbreviated MPID in the regs, but we'll just call it the merchant product ID here for simplicity.
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Um, and that's just your your stock keeping unit, your SKU, it could be your product ID on your e-commerce catalog.
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There's not a lot of um of requirements with there, but there is some guidance about what makes a a good product identifier for for the merchant to be able to do it.
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What's like the guide?
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Okay, I'm curious, like what makes a good product identifier?
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Yep.
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So specifically, they're looking to understand um all all shipments of that same item uh uh coming in from uh from from your um from you.
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So so so if you have a if you have a skew using the same SKU across that item, yeah, that's all they're saying is be consistent with your identifier if it's the same item.
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Exactly.
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So if you're for for instance, if you're um selling serialized goods, right?
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And they're they're all the same good, but maybe they're limited edition runs and you've got a serial number on each of them.
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What you should not do is use that serial number as your merchant property.
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Because it's different on everything.
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Even though it's really the same one, individual, exactly.
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It looks different.
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I gotcha.
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Okay.
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Yep.
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So so they want you to avoid that.
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Uh similarly, you don't want to add the lot ID or things like that to it.
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And they'd love these to be hierarchical in nature.
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So if you have variants, right?
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Of course they would love that.
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Okay.
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Hierarchical, all right.
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A blue shirt, they they you want to use the same in a red shirt, you want to have the same product ID, maybe with a dash blue at the end or a dash red, or which is fairly common in industry.
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But but these are sounds like suggestions on the suggestions, they're not um enforcements.
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However, on the the flip side, that serial one, that there they do view as a as a violation.
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But the hierarchy is just uh a random generator, yeah, generated ID, basically, at that point.
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Okay.
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Uh all right, so we have the the MPID, which is the merchant product identifier that the merchant knows and should be able to supply.
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Okay, it sounds easy so far.
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Okay, what else?
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Yep.
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And then there's two uh product IDs that are intended to come from the manufacturer.
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One is a standard product ID, and one is a non-standard product ID.
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So we'll talk about the standard product ID first, because that's probably easiest to understand conceptually.
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Um and that's simply the product identifier used and and uh registered with um it could be with like the um a UPC, a universal product code, it could be an EAN, a European article number, it could be the ISBN for books, right?
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So we say could be this is an or.
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It's an or.
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So they could have any of these.
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So we have a little family business selling Halloween costumes.
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And as long as we use the UPC or that identifier, that covers that number.
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Yep, that's correct.
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That would be sufficient.
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Um but they have to be But they need to be registered, it's a registered number.
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It's a registered number and it's standardized across all sellers of the identical good, right?
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Okay.
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And and that brings traceability across all exporters into the EU so that they can track the volume and understand what this commodity is by looking in those registered databases, etc.
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Um and so that's the standard product.
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Do you have to identify which one it is that's like UPC colon or EAN colon, or they'll just there's no ask to do that in the regs.
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Um typically those can be identified uh by the length or by the pattern.
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Um they'll figure it out.
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I'm sure that they'll be able to figure it out.
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Yeah, we certainly could.
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Okay.
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So that was this the S PID, right, which is the standard product identifier.
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Correct.
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Okay, so two of the three.
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Yep.
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And then the the last one is the non-standard product ID.
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And this um is relatively straightforward, at least in principle.
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It's the product identifier issued by the manufacturer that isn't necessarily registered with okay.
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So conceptually, if I'm thinking if I'm a retailer and I have my own product internal kind of number, a manufacturer also has their own kind of internal identifier and it's that one.
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So it's typically like the model number of the item that you're being that that you're that is being sold, right?
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So it's generally understood.
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Maybe it's not the the retail branding of the product.
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So you might call this like the you know Galaxy S10, you know, but and then the the the model for that might have um five or six letters or numbers, but it's typically listed on that same product.
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I see.
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So it's on there, it's on if you if I went to if I got a um uh a catalog, you know, of items to purchase, you know, a PDF from a manufacturer, chances are they have all of these in that catalog, in that PDF, right?
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Yeah, and if you go to those model numbers, if you go to their support, non-standard product identifiers, okay.
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If you go to the support on their website of the manufacturer's website, you'll probably have to put in the product ID or the model ID of the product to find the relevant docs and I see it's it's that product ID.
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This this is in reality, this this sounds complicated, but it's actually ultra simple.
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The EU seems like they're just saying, look, everybody's already using part numbers in the in in the course of doing business.
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Just share them with us.
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Yep.
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And and when it comes down to the manufacturer, Clint, if you're buying, if you're buying supplies from uh or products from a manufacturer, you have they have a part number and a catalog they're using to sell to you.
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Whether they went to the extra effort to register them with the UPC or AEN or whatever, um, or not, or maybe they just made up their own internally.
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Either way, that's the standard, you know, standard versus non-standard.
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But it's a part number you're ordering off of.
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They just want to know what that is.
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And then when you keep your inventory, you might assign your own part number for inventory purposes, or you might reuse that one.
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But either way, whatever number you're using, they want you to share that too as a as a retailer.
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So I could use my mer my merch my MPID, my merchant product identifier, could be the same as the non-standard product identifier.
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That could be a pretty common.
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So you just you would in that case, then you just repeat the same the manufacturer twice.
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So Aaron, you said something that I you said this sounds simple, but does it is this easy?
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So like like like what what if um what if I'm selling an eBay?
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Okay, so what what if like now now let's go through like the real case scenarios of is this even practical?
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How how are how do companies do this at scale?
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Like, who is this a challenge for?
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Yeah, because I I think in general, I think this is if I look at it from the the EU's eyes, they're like, hey, this is what's happening in the course of business, share.
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Now, of course, that there's always the 80-20 rule, right?
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And I do think that's accurate.
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Of like, they're not asking the industry to make up a new number that didn't exist before, they're just asking to share in their minds, they're just asking to share the numbers that already exist that are already being used.
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So they just want to see them.
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Yeah, right.
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That that's that's pretty much it, right?
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That's precisely a simple concept.
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Okay.
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They do ask for they do have some carve-outs there.
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So we just want to be explicit.
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So anything that is agricultural or perishable, I think chapters one through fifteen, these are like live animals, grain, I'm sure everybody knows what chapters, you know, one through fifteen areas.
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Um agricultural products that tend to be perishable.
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Okay, so so into the US or you know, elsewhere, just the harmonized code.
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The harmonized chapter, the harmonized schedule, those chapters did is that how they excluded it based on chapter.
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Yep, exactly.
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So they say anything chapters one through fifteen, those you don't need to have uh uh a PID for that, a product ID, uh, because there isn't really a uh manufacture product ID for those, right?
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They're they're commodities.
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Um similarly, if things are handmade, um they list specific headings uh headings in there, but it's like you weave your own baskets or you carve your own figurines, or you know, there's some very nuanced um um cases there where there's no um uh manufactured product ID required.
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And then any things that are uh art, antiques, collectible stamps, or coins, all of those would be excluded.
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So they're trying to find the items that you just they number would not exist, in other words, right?
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They're trying to, and that does capture some of those cases, but remember an antique has to be over a hundred years old to be an antique.
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Holy cow.
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So anything that's 75 years old, not an antique.
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Okay, so something made in 1928.
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You better know your 26.
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Yeah, yeah.
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Yep, yep.
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So 28, you need to know at 26, you might not.
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Yeah.
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So um they did contemplate marketplaces and marketplace list marketplace listing IDs in this, correct?
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So how how would that be used if you're selling on a marketplace?
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Uh merchant product ID, you can use the the marketplace identifier for that.
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Um if you're selling on let's say Amazon, that would be the ASIN right there.
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But uh it has to be a so you could use your ASIN, but that's still that's just your identity, that's not solving the non-standard or the standard.
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Right.
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That's not the manufacturer ID.
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That would be for the own identifier is.
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So if you're but but as a seller, if I'm if I'm thinking through all the different things like wait, I'm I'm an eBay seller or an Etsy seller or you know, whatnot, or wherever I'm selling, I'm going to my stock keeping unit might be my listing IDs.
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Yep.
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And that and that would be fine to use in the in the M ID, right?
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And that's probably the preferable one to use as opposed to one that isn't discoverable.
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Right.
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So if it's if it's something that's completely behind the scenes, that it's internal to your systems, but it never makes it onto the platform on which you sell, that might be a less good one.
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Okay.
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And then if I'm if I'm reselling something and I have the box sitting there or a tag on it or something, it might have the manufacturer ID.
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In most cases, they would or or I'd see the UPC code or something.
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And that's what I'd use as one of the manufacturer IDs, whether it be standard or or non-standard, right?
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And if you only have the standard ID, the EU has come out and said that that's completely fine to use that in both places, both the non-standard and the standard ID.
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Okay, you just so you just duplicate it.
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You can duplicate it.
00:16:58.960 --> 00:17:00.960
Okay, so you can use the standard ID twice.
00:17:01.200 --> 00:17:01.840
Yes.
00:17:02.240 --> 00:17:03.600
It doesn't work the other way around.
00:17:03.840 --> 00:17:08.160
It's a it's a little bit easier to find the standard ID, though, isn't it, than the non-standard ID?
00:17:08.480 --> 00:17:18.160
Yeah, if you're if you have the physical product and you're you see the barcode, for instance, that would be uh in many cases the UPC or have the ISPN on the book or or whatnot.
00:17:18.319 --> 00:17:20.079
So in many cases, yes.
00:17:20.319 --> 00:17:29.759
And then on the original packaging, you typically, not always, but you typically see a model number, um, uh or uh and that would be your your non-standard.
00:17:30.160 --> 00:17:40.000
Well, and I think even um this is where I I think it might get tricky for a seller is even non-standard product IDs are gonna be on the packaging too often from from manufacturers.
00:17:40.079 --> 00:17:42.319
They just didn't go register it, but it's still there.
00:17:42.640 --> 00:17:59.440
And then being able to know is a standard or not standard, that's where maybe some of the nuance might come in from a seller, but it sounds like probably if do your best to know, yes, and then still take that number and and share it in in one of the fields, at least the non-standard field.
00:17:59.519 --> 00:18:01.519
If you're not sure, then it's it's correct.
00:18:01.759 --> 00:18:04.160
What what happens if I create a bundle or something?
00:18:04.240 --> 00:18:05.599
Like what happens in these scenarios?
00:18:05.680 --> 00:18:11.119
Like it uh or a whole a whole lot of something on the marketplace.
00:18:11.279 --> 00:18:13.279
Yeah, like I sold a whole bunch of Pokemon cards.
00:18:13.519 --> 00:18:18.880
Yeah, so those are great questions and not well contemplated in the in the regs.
00:18:19.119 --> 00:18:25.759
I'll I'll tell you what you know, crumbs of guidance we have, and and this is how we we would approach it, right?
00:18:26.079 --> 00:18:29.759
Um, so with bundles, um, who becomes the manufacturer there?
00:18:29.920 --> 00:18:31.119
That's a really interesting question.
00:18:31.359 --> 00:18:39.920
If you're bundling products from multiple manufacturers, right, and and you you become and you put it in the same packaging and they're sold as a unit, right?
00:18:40.400 --> 00:18:45.359
Then arguably you become the manufacturer of that good, that bundle.
00:18:45.759 --> 00:18:49.599
You've created this new You've created a new SKU SKU to be sold.
00:18:50.480 --> 00:19:03.200
And so arguably, I again the the re the regs and the guidance are are relatively speaking silent on this, but um uh it would be reasonable for you to create your own non-standard product ID in in that.
00:19:03.759 --> 00:19:07.359
But but would they have to create a would they have to create a standard product ID though in that case?
00:19:07.440 --> 00:19:12.960
Like what happens with the the you know, and the UPC or though that that particular identifier.
00:19:13.279 --> 00:19:23.440
Yeah, so so uh standard product IDs that you recognize as they are an additional burden, there's some cost associated with registering those, and not all products are registered.
00:19:23.519 --> 00:19:35.279
And so they say where they exist you are supposed to put them on, where they don't now the bundle itself, there's there's different reasons why you might be reporting that at the individual piece level, right?
00:19:35.359 --> 00:19:40.960
And so instead of looking at the one bundle, you might actually be declaring those as the items within there.
00:19:41.119 --> 00:19:46.240
Though there's the GRIs used for classification that'll likely drive a lot of a lot of that.
00:19:46.400 --> 00:20:04.559
But if if they are uh you know transformed into a single bundle and you would report them otherwise on a on a customs form as a single line item, then arguably there's enough uh transformation there for you to be considered the manufacturer and for you to uh put your own uh identifier as the manufacturer product ID.
00:20:04.880 --> 00:20:06.480
So let me let me ask this question.
00:20:06.720 --> 00:20:12.480
Um I'm selling a lot of something on a marketplace.
00:20:12.640 --> 00:20:14.160
I have my marketplace listing.
00:20:15.440 --> 00:20:18.240
Does that just become my manufacturer ID as well?
00:20:18.799 --> 00:20:22.880
Um when you say lot, do you mean like a a random sample of the same?
00:20:23.039 --> 00:20:28.079
No, let's say I've just got a bunch of junk in my backyard in my shop that I'm that I'm selling, right?
00:20:28.319 --> 00:20:34.079
Yeah, and I A, if I if I can find the manufacturer ID on it and I'm selling one one piece, then I I would.
00:20:34.160 --> 00:20:36.160
But now I'm selling like a whole bunch of baseball cards.
00:20:36.880 --> 00:20:38.480
And I'm selling a whole box of them.
00:20:38.640 --> 00:20:39.119
Yep.
00:20:40.319 --> 00:20:45.279
You're saying that I if really it's it's kind of a it's a unique one-off thing.
00:20:45.359 --> 00:20:58.960
It's and does my but does my marketplace listing ID that's my that's my merchant uh identifier, right, as the seller, and then does that also persist to a non-standard uh uh manufacturer ID?
00:20:59.279 --> 00:21:00.480
So that's a great question.
00:21:00.640 --> 00:21:04.720
It's not contemplated at all in the ranks, so it's not clear.
00:21:05.759 --> 00:21:06.079
Okay.
00:21:06.880 --> 00:21:07.759
That's it, that's it.
00:21:07.920 --> 00:21:09.759
I think we can go back to the driving principles.
00:21:10.319 --> 00:21:11.599
But that's where I was gonna go with it.
00:21:11.839 --> 00:21:20.880
And so the driving principles are to provide more transparency and track and traceability across the various players in the supply chain and to provide that protection.
00:21:21.039 --> 00:21:41.759
And so uh, you know, in that case of you know, I'm I'm creating a a new product that is maybe a bundle of Pokemon cards or baseball cards or whatever that is, um, you may be able to and and you might want to um try to describe these in a way that that conveys what they are as best as possible.
00:21:41.839 --> 00:21:48.319
Um, and something that can be used across many such sellers, uh uh across platforms, et cetera.
00:21:48.559 --> 00:21:54.799
So uh what I would probably do is I would I would probably create a hierarchical um product I D there.
00:21:54.880 --> 00:21:58.640
So it might be like MLB dash tops dash, you know.
00:21:59.279 --> 00:21:59.759
So you just create
00:22:00.160 --> 00:22:00.880
You'd create your own.
00:22:01.440 --> 00:22:04.640
Again, the the regulations do not contemplate that.
00:22:04.799 --> 00:22:07.279
However, I think that's what the intent is.
00:22:07.519 --> 00:22:10.400
Um now we we are hoping for more guidance.
00:22:10.480 --> 00:22:13.920
There's still a lot of ambiguity and a lot of things unaddressed here.
00:22:14.079 --> 00:22:32.319
But if I was the regulator, I would want to have see something like that develop that's that's is common across sellers, that isn't just what Aaron made up or what Clint made up, but that that everyone that's doing this selling the same type of thing is using the same type of identifier.
00:22:32.640 --> 00:22:33.920
But it sounds like we're not there yet.
00:22:34.079 --> 00:22:34.880
That's correct.
00:22:35.440 --> 00:22:38.160
And it also sounds like you know, we use the 80-20 rule.
00:22:38.319 --> 00:22:51.039
The intent of this is it feels like they're really going after newly manufactured batches of goods that are coming in, and they're trying to target groups of products that are coming in.
00:22:51.599 --> 00:22:56.400
That's kind of the in their mind, what they're going after is like, hey, we've got a lot of this type of good coming in.
00:22:56.480 --> 00:22:58.079
Let's we we need to catch it.
00:22:58.319 --> 00:23:01.039
Or they or they want to ignore it and so they get the mass, okay.
00:23:01.119 --> 00:23:03.599
Here's all the good ones, so they can then focus in on the bad ones.
00:23:03.839 --> 00:23:07.920
And all these one-offs don't really feel like it's their primary focus right now.
00:23:08.880 --> 00:23:12.960
Certainly not their focus if you could read the regs, it's it's not well contemplated there.
00:23:13.039 --> 00:23:15.200
So how how how problematic is this going to be?
00:23:15.279 --> 00:23:20.559
Okay, so and for who come November 1st, you forget it.
00:23:21.039 --> 00:23:24.640
But what what is practically going to happen come November 1st?
00:23:25.039 --> 00:23:31.440
Um, and who are the different obviously we talked about retailers, who else is struggling with this, right?
00:23:31.519 --> 00:23:35.839
What what in whether in the logistics field or brokers or whatever, right?
00:23:35.920 --> 00:23:38.319
Like declarance, like what yeah.
00:23:38.720 --> 00:23:47.599
So so the EU talks about three uh parties that are involved in this, and and there I think there's more than the three that they talk about, but they talk about the the manufacturer, right?
00:23:47.680 --> 00:23:57.200
So is the manufacturer your duty is to be able to provide those manufactured product IDs to to anyone asking for them, to be able to provide that information and help you.
00:23:57.680 --> 00:23:59.359
Are manufacturers usually cool with that, you think?
00:23:59.599 --> 00:24:00.480
Um generally, yeah.
00:24:00.559 --> 00:24:02.960
If you're working through their distributors and whatnot, they're happy to do that.
00:24:03.039 --> 00:24:07.440
Now, if you you have something in your basement from 1928, um that's maybe nine.
00:24:08.000 --> 00:24:12.480
What if you're what if you're like one more step you what if you didn't buy directly from the manufacturer?
00:24:13.039 --> 00:24:13.279
Right?
00:24:13.440 --> 00:24:14.720
And you're selling on eBay.
00:24:14.960 --> 00:24:15.519
Yep.
00:24:15.839 --> 00:24:16.400
Yeah, yeah.
00:24:16.720 --> 00:24:23.920
You know, I mean, there the EU tells them that they should be responding uh responding to all parties that are inquiring on that.
00:24:24.160 --> 00:24:28.480
Whether that's happening in practice or not is is um is probably questionable.
00:24:28.640 --> 00:24:36.400
Uh, but if you have a direct relationship with your with the wholesaler or with the with the manufacturer, you should be able to get those from them without much effort.
00:24:36.799 --> 00:24:39.119
And and hopefully in a lot of cases, you just look at the box.
00:24:39.920 --> 00:24:41.039
The packaging it should be listed somewhere.
00:24:43.759 --> 00:24:45.359
Okay, so that that's party one.
00:24:45.519 --> 00:24:48.559
Party two is the is obviously the the merchant to the seller.
00:24:48.720 --> 00:24:54.079
Um and they're responsible primarily for the merchant product ID.
00:24:54.160 --> 00:24:59.359
Um obviously that's something that they can control or the platform that they're on can can help them provide.
00:24:59.599 --> 00:25:02.559
And the third that they talk about is the declarant.
00:25:02.640 --> 00:25:12.799
Um that's the person uh responsible, and they're the ones um responsible for all the accuracy of those IDs that are being put on any sort of entry documentation.
00:25:13.119 --> 00:25:18.079
And a declarant is, though not a perfect parallel, similar to an importer of record.
00:25:18.880 --> 00:25:19.599
It's a good mental model.
00:25:20.079 --> 00:25:24.880
It's the person taking within the EU that's taking responsibility for the the shipment.
00:25:25.200 --> 00:25:25.440
Okay.
00:25:26.480 --> 00:25:29.599
And this where is where it starts to, I think, get kind of difficult, right?
00:25:29.680 --> 00:25:36.079
Because when if it's impacting the declarant and you have someone that's non-compliant upstream, right?
00:25:36.160 --> 00:25:45.359
You're let's say you're you're you know, and so now the logistics providers are involved because they're either they're the declarant or they're working with someone that's a declarant and they know they need to solve this problem.
00:25:45.519 --> 00:25:49.519
Like, how what what are the what are the concerns out there in the industry?
00:25:49.599 --> 00:25:56.000
Yeah, and what are what what are we working to do in in the as an industry or you know, even us possibly to help solve some of this?
00:25:56.319 --> 00:26:05.839
Yeah, so it's important to call out that any any carrier, and many have come out and said this, they will not accept a shipment bound for the EU without two of those three product identities.
00:26:06.079 --> 00:26:07.599
Okay, so they're gonna make them required fields.
00:26:08.000 --> 00:26:08.319
Yep.
00:26:08.559 --> 00:26:11.759
Whether they're whatever's in there is in there, they're not validating or anything.
00:26:12.000 --> 00:26:22.880
And I think that's the key, is they they won't have mechanisms to be able to confirm the validity of non-standard product IDs or even your own main uh merchant product identifier.
00:26:23.119 --> 00:26:23.599
Right.
00:26:23.839 --> 00:26:32.160
Um now what what that means in practice is it also means that if you look at the EU um commission, they're gonna have the same challenge.
00:26:32.319 --> 00:26:38.559
These are really difficult things to to validate because they they are in fact non-standard, but they'll be keeping logs, right?
00:26:38.640 --> 00:26:40.480
They're they're gonna be collecting data.
00:26:41.279 --> 00:26:48.160
And I would expect that um how how much validation is done on that will ramp up over time.
00:26:48.400 --> 00:26:51.119
Um they won't on day one.
00:26:51.200 --> 00:26:54.559
They just they they can't they don't have the mechanism because they don't have the data yet.
00:26:54.799 --> 00:27:00.720
But over time, if they start seeing something that doesn't match a pattern, you you could be flagged.
00:27:00.880 --> 00:27:02.240
So you want to be compliant day one.
00:27:02.319 --> 00:27:02.559
Yes.
00:27:02.799 --> 00:27:11.440
And if someone isn't compliant day one, uh you should be, but chances are it's probably still getting in if there was a field that was put in there, something was put in.
00:27:11.759 --> 00:27:12.480
It it it it may.
00:27:12.559 --> 00:27:13.680
Now that's that's not advice here.
00:27:14.160 --> 00:27:14.720
No, absolutely not.
00:27:15.200 --> 00:27:16.160
Condoning that at all.
00:27:16.319 --> 00:27:22.000
We we we we should be working very diligently to be able to create these and provide these identifiers.
00:27:22.160 --> 00:27:28.079
Um, but that said, if if it's not 100% perfect, you're doing your best, I think there's going to be a lot of grace on day one.
00:27:28.400 --> 00:27:28.720
Okay.
00:27:28.880 --> 00:27:30.640
So you so you and your team, all right.
00:27:30.720 --> 00:27:36.559
This is a problem for you guys too, because customers are coming to you know and asking, hey, um, how do I solve this at scale?
00:27:36.799 --> 00:27:42.319
What what are what are some things on uh um uh ways to solve this at scale, would you say?
00:27:42.480 --> 00:27:42.960
Yeah, yep.
00:27:43.039 --> 00:27:46.160
So and and for who, like who would that be relevant to, possibly?
00:27:46.400 --> 00:27:46.960
That's a great question.
00:27:47.039 --> 00:27:59.519
I think there's there's two classes of of parties here that are interested in making sure that when in in the 20% of cases where there isn't a clear answer that we still can help facilitate compliant trade.
00:27:59.680 --> 00:28:02.799
Um the the first one is the carriers themselves, right?
00:28:02.960 --> 00:28:17.119
So if if uh if I'm um let's say I'm FedEx or I'm you know um Royal Mail or I'm um you know even USPS, I want to be able to facilitate shipments into the EU, and I don't want to see my volume decline.
00:28:17.200 --> 00:28:26.720
So I want to be able to provide tooling and and help to anyone that that might want or need um assistance to to find these type of product identifiers.
00:28:27.200 --> 00:28:30.000
Um and so what what does that look like in practice?
00:28:30.160 --> 00:28:36.559
Um uh ideally I would be able to have some type of um mechanism to to search for a commodity.
00:28:36.640 --> 00:28:49.519
So if I if I don't know, if I if I know for instance, hey, this was a a um a figurine, maybe it's a doll made in the in the 1990s, and here's the attributes of that doll.
00:28:49.839 --> 00:28:57.039
If I can go and find a database and start to search through these, that and I can extract that product, that would be really helpful.
00:28:57.119 --> 00:29:10.000
And I could be able to facilitate a lot more compliant trade by providing tools to the people that use my services as a carrier so I can continue to see volume there into the EU and and and facilitate that that compliant trade.
00:29:10.160 --> 00:29:12.960
So that would maybe be one example of an interested party.
00:29:13.200 --> 00:29:21.200
A second example would be a um, let's say it's a um a platform, uh, e-commerce platform, right?
00:29:21.759 --> 00:29:26.079
A platform, a marketplace, just a big that that someone's putting out listings.
00:29:26.480 --> 00:29:26.880
Precisely.
00:29:26.960 --> 00:29:27.279
Yeah.
00:29:27.440 --> 00:29:28.079
Precisely.
00:29:28.240 --> 00:29:44.880
Um, you know, you think there's many such um of these that um work with and uh maybe they're secondhand goods, maybe they're um goods that are have are uh have been used or restored or otherwise fall on that 80 per or that 20 percent that is a little bit harder to do.
00:29:45.039 --> 00:29:58.400
Um uh we would be able to help provide um a mechanism to to essentially perform that same type of search functionality, but at scale, uh, and to help their their sellers identify that these these in fact doesn't have to be.
00:29:58.720 --> 00:30:03.599
How do I get my listings out quickly without friction is the problem you're we're trying to do?
00:30:03.839 --> 00:30:10.160
So so it just helps the sellers be more efficient at coming up with the identifiers and be more accurate in accuracy.
00:30:10.559 --> 00:30:23.440
And and and and that's the thing is you know, the the harder, the easier you can make these types of um compliance pieces of information to to be able to search, provide, and then surface, the more compliant the trades.
00:30:24.319 --> 00:30:33.200
It's completely different, but it also feels similar in in practice and in helping a seller to classify their goods with a HTS code, right?
00:30:33.359 --> 00:30:34.960
It's the same principle of like let's something.
00:30:35.920 --> 00:30:37.440
Yeah, let's help you let's help you.
00:30:37.519 --> 00:30:42.559
And and that's the kind of thing is that let's help you find the the right ID for your products to be compliant.
00:30:42.960 --> 00:30:43.759
That's precisely right.
00:30:43.839 --> 00:30:53.200
And we don't want a hundred different entities trying to solve the the lot problem in a hundred different ways, because that is really um antagonistic to the goal of the EU.
00:30:53.759 --> 00:31:08.960
We really want to be able to help facilitate hey, that when Aaron goes and sells his lot of cards, and when Quint sells his lot of cards, and when I sell my lot of cards, that we're all creating those identifiers in the same way that that'll be able to facilitate ultimately the EU's goal.
00:31:09.200 --> 00:31:14.559
So even helping create identifiers in certain situations, yeah, where where they truly don't exist, right?
00:31:14.720 --> 00:31:17.920
We don't want uh a hundred different entities doing the same thing in a hundred different ways.
00:31:18.240 --> 00:31:25.680
And it seems like you know, there's a third party that you that that uh would make a lot of sense, and it's the one that wants to validate the numbers that are coming in, right?
00:31:25.839 --> 00:31:27.519
So the EU, right?
00:31:27.759 --> 00:31:50.160
Uh um wanting to validate these identifiers, the same model that I mean, we've built out so many different AI models with Classify and ECCN and other things could be used for flagging possibly um goods that don't seem to uh have a valid ID or it doesn't seem to match the description or something like that.
00:31:50.480 --> 00:31:51.359
Yeah, that's precisely right.
00:31:51.440 --> 00:31:57.759
So the same the same tooling that is used to help surface information can also be the tool that's used to help validate information.
00:31:57.920 --> 00:32:00.880
And there's a few different ways you can seek to validate that.
00:32:01.119 --> 00:32:04.880
One I'll call the in at the individual parcel or the line item level.
00:32:05.039 --> 00:32:12.880
You can look at that line item, the description of that line item, the the product IDs, and you can say, hey, do these appear to be correct?
00:32:13.039 --> 00:32:16.480
Um and you can do that with a database of information um that you have.
00:32:16.720 --> 00:32:22.079
But uh the second, and I think also even more powerful, is the is the longitudinal view of this, right?
00:32:22.319 --> 00:32:40.000
So you can create a lot of statistical patterns on what type of uh uh product IDs you're seeing being transmitted by certain entities in certain cases, and that can build a lot more confidence that this is a compliant actor or this is someone that is has has um mailed it in, so to speak.
00:32:40.240 --> 00:32:41.759
Yeah, fascinating.
00:32:42.000 --> 00:32:53.200
Okay, so I've got I'm a seller, I'm selling my goods, this new law comes in, I know my product ID or I use tools to help me come up with all the IDs I've got.
00:32:53.440 --> 00:32:53.759
Great.
00:32:54.160 --> 00:32:56.240
I'm compliant now because I have the IDs, right?
00:32:56.720 --> 00:33:02.720
But I I actually need to be able to get them there, and that that's where I think some of the disruption might come into play.
00:33:02.799 --> 00:33:09.119
It's because look look at the 80% already, the 80% already has their product IDs, but now they have to be able to share them.
00:33:09.519 --> 00:33:11.279
And this is easy, Aaron.
00:33:11.440 --> 00:33:12.480
You just how do you do that?
00:33:12.799 --> 00:33:22.640
It just, you know, it's gonna I'm sure all the shipping platforms are gonna have three different fields for your you know, MPID, your end pit, and your SPIT, right?
00:33:22.720 --> 00:33:24.319
That's just all of them.
00:33:26.720 --> 00:33:27.839
So what are you gonna do?
00:33:28.079 --> 00:33:28.640
I don't know.
00:33:28.880 --> 00:33:39.680
What do you how how how how is this because I actually think operationally that's probably the biggest disruption right now in the in the because this hasn't been I mean, we're talking months, not years here for everyone to prepare.
00:33:39.759 --> 00:33:42.000
This has probably been off the radar for a lot of people.
00:33:42.240 --> 00:33:46.000
I know in the postal stream, there's no I mean, getting those fields updated.
00:33:46.079 --> 00:33:52.400
I I was just listening to some information on that of basically like throw it into one of the existing fields they got and hope it works.
00:33:52.480 --> 00:33:53.359
Um, kind of thing.
00:33:53.519 --> 00:34:02.160
Like it's not an explicit field for this yet because they haven't been able to update their their their systems field to support these specific identifiers.
00:34:02.319 --> 00:34:02.799
Yeah.
00:34:03.119 --> 00:34:06.640
So what is going on in the industry operationally to be able to support this?
00:34:06.960 --> 00:34:07.200
Yep.
00:34:07.279 --> 00:34:12.639
So it it depends on the the the shipping platform or or relationship you have with the carrier themselves.
00:34:12.719 --> 00:34:16.559
Um many of the express carriers have already introduced these fields and are accepting them.
00:34:16.719 --> 00:34:20.719
So if you work directly with an express carrier, I think you'll be in good shape.
00:34:20.960 --> 00:34:23.360
So that's where if if I'm not sure, talk to my rep.
00:34:23.599 --> 00:34:24.079
Talk to your rep.
00:34:24.320 --> 00:34:25.360
They'll give me the instructions I need.
00:34:25.519 --> 00:34:25.679
Okay.
00:34:26.000 --> 00:34:26.239
Yep.
00:34:26.320 --> 00:34:31.519
Um, if you work with a shipping platform, there's that's a much larger um group uh there.
00:34:31.760 --> 00:34:37.199
And it really talk with them, make sure that they are able to receive those fields and they can map them to you.
00:34:37.280 --> 00:34:49.920
But to your point, there are some entities that are um large uh carriers uh in the like for example, the postal stream where where there is no dedicated field that it takes a an industry body essentially to be able to go and modify.
00:34:50.559 --> 00:34:57.679
But this is where I could if I'm working with a shipping platform, I talk to them, they're gonna worry about mapping to the carriers as needed.
00:34:58.000 --> 00:35:05.360
I need to work with them to ask them how do I map my database to you, and they'll take care of the rest, assuming they're preparing for this.
00:35:05.440 --> 00:35:12.639
And I'm I'm sure so uh many of them are, but there may be some that aren't ready, and that's where you need to have a conversation with with your suppliers.
00:35:12.880 --> 00:35:18.239
And and and now in our case, because we do a lot of it's into the US, there might be a channel integration in place, right?
00:35:18.320 --> 00:35:24.239
Meaning somebody connected their eBay account, their Etsy account, and if a lot of those identifiers are there, we're gonna pull them in, right?
00:35:24.400 --> 00:35:29.119
Come to the US, but function same similar functionality, that Japan retailer, right?
00:35:29.280 --> 00:35:54.320
That's selling to the US, that data can be then supplied even outside of that data stream with the like if they if they were unable to get it, let's say, into um uh you know, into a shipping platform or get it passed to uh you know Japan Post or something, we can supply that data to the to the end um uh you know broker into the EU.
00:35:54.480 --> 00:35:56.480
Would that be a right way, a good way to describe it?
00:35:56.719 --> 00:35:57.519
Yeah, absolutely.
00:35:57.760 --> 00:35:59.679
In fact, we do that for many of our customers today.
00:35:59.840 --> 00:36:03.039
So um we we do help customers sell cross-border.
00:36:03.119 --> 00:36:08.079
Um we sync through our product catalogs, we uh handle checkout, and we help you print labels.
00:36:08.239 --> 00:36:15.199
And in those situations, we're able to make sure that that information gets straight onto the onto the label and and ultimately to the broker.
00:36:15.440 --> 00:36:25.280
There are further situations where we have more information that where we don't uh aren't in the label flow, and and in that case, we're we're happy to be able to help provide help facilitate that to the to the right end party.
00:36:25.440 --> 00:36:25.840
Yes.
00:36:26.159 --> 00:36:32.639
Any anything else on this uh um that we forgot today that you want to mention around product identifiers?
00:36:33.119 --> 00:36:39.199
Uh and there has been a lot of disruption over the past 12 months, but you know, November 1st, we got some more coming.
00:36:39.280 --> 00:36:40.239
So yeah, yeah.
00:36:40.400 --> 00:36:44.559
And and you know, the you would say that this has been out since July 1st.
00:36:44.639 --> 00:36:46.400
You've been able to provide this information.
00:36:46.639 --> 00:36:55.119
I think what we've seen is that um that typically doesn't happen until it's it's what percentage of shipments would you say in the postal streamer right now?
00:36:56.000 --> 00:37:13.679
I would say in general, total if you had to guess, and I I know this is a wag, how many what what percentage of participation do you think there has been since July 1st in this in this tension period, this optional uh period?
00:37:14.559 --> 00:37:16.400
It's likely under five percent would be my.
00:37:17.199 --> 00:37:23.039
I think everybody uses November 1st as as the deadline uh that that they're all working to meet, right?
00:37:23.280 --> 00:37:24.079
Um which I agree.
00:37:24.159 --> 00:37:26.000
I mean, I think July 1st came really fast.
00:37:26.239 --> 00:37:31.440
Um and so everyone's kind of been gearing up to be to be ready to start transmitting this um before November 1st.
00:37:31.519 --> 00:37:38.079
But I think that's important to note that look, if you've got the systems in place, start doing this before November 1st.
00:37:38.400 --> 00:37:38.559
Yes.
00:37:38.880 --> 00:37:39.119
Yes.
00:37:39.519 --> 00:37:42.480
It's the the pipeline's there for for the EU to receive it.
00:37:42.559 --> 00:37:43.599
It has been for months.
00:37:43.760 --> 00:37:48.159
Don't wait until and push a release out right on right for November 1st.
00:37:48.320 --> 00:37:55.039
Push it out early and get it moving, get the holidays coming, get get your systems up and operational, then November 1st is just a formality.
00:37:55.519 --> 00:37:56.000
Absolutely.
00:37:56.559 --> 00:37:57.280
Makes a lot of sense.
00:37:57.440 --> 00:38:01.840
Hey, well, thanks uh for another insightful episode today, and uh looking forward to the next one.
00:38:02.000 --> 00:38:03.039
See you guys.
00:00:06.320 --> 00:00:11.439
Hey, welcome back to another episode of the Decoding Cross Border E-Commerce Podcast.
00:00:11.759 --> 00:00:16.640
Today, uh, we're gonna do a deep dive on product identifiers.
00:00:17.039 --> 00:00:21.199
And look, I don't know a lot about the product identifiers, so I'm gonna be asking a lot of questions.
00:00:21.280 --> 00:00:22.000
I'm excited about that.
00:00:22.079 --> 00:00:26.000
So today we have uh Jonathan Sullivan, our chief data scientist with us.
00:00:26.079 --> 00:00:28.800
Uh welcome to the welcome back to the podcast, Jonathan.
00:00:29.039 --> 00:00:30.079
Thanks for having me back, Clint.
00:00:30.239 --> 00:00:30.559
Yeah.
00:00:30.719 --> 00:00:37.039
And then uh as always, we have Aaron, you know, who will uh come up with a joke for us at some point, but it'll be at right at the right time.
00:00:37.119 --> 00:00:38.320
I don't know what's gonna be.
00:00:38.479 --> 00:00:39.439
He's always prepared.
00:00:39.840 --> 00:00:40.960
Just here to do my part, Clint.
00:00:41.200 --> 00:00:41.679
Yep, good.
00:00:41.920 --> 00:00:46.159
All right, so these are gonna become required November 1st into Europe, right?
00:00:46.320 --> 00:00:47.359
Product identifiers.
00:00:47.600 --> 00:00:48.640
That's correct.
00:00:49.359 --> 00:00:50.000
Why?
00:00:50.240 --> 00:00:55.200
Why are why why is why is this even a thing?
00:00:55.359 --> 00:00:57.200
And it's apparently just in Europe right now.
00:00:57.280 --> 00:00:59.679
There isn't like another country that's doing something similar.
00:00:59.840 --> 00:01:01.359
So let's go a little bit into the why.
00:01:01.600 --> 00:01:04.879
Jonathan, tell me a little bit about the why and then what as well, right?
00:01:04.959 --> 00:01:07.359
Like feel free to dive into that too, like exactly what it is.
00:01:07.519 --> 00:01:13.040
And because more I I mean, I just to we're kind of talking to the retailer right now, right?
00:01:13.120 --> 00:01:15.519
I want to make sure that they understand what their obligations are.
00:01:15.680 --> 00:01:17.840
So as you kind of frame it, be keep them in mind.
00:01:18.079 --> 00:01:19.280
Yeah, absolutely.
00:01:19.519 --> 00:01:32.640
So this all came out as part of the uh um EU customs reform that included the elimination of the de minimis, the introduction of the three euro um fee for every every uh low-value package coming in.
00:01:32.799 --> 00:01:42.400
And as part of a broader global trend for increased visibility on on e-commerce um low-value uh shipments coming into the market.
00:01:42.719 --> 00:01:44.239
Well, what kind of visibility do they want?
00:01:44.560 --> 00:01:46.239
Yeah, so that's a great, great, great question.
00:01:46.319 --> 00:01:48.719
So there's there's two primary objectives generally.
00:01:48.799 --> 00:01:51.599
Um one is for increased revenue collection, right?
00:01:51.840 --> 00:01:54.239
That's what we saw come into effect earlier this year.
00:01:54.560 --> 00:01:58.239
So a standardized number would help them possibly Yeah, no.
00:01:58.319 --> 00:02:06.560
Um so uh if you look at the the the actual reform, um the that that is specifically the three euro uh fee that was added, right?
00:02:06.719 --> 00:02:07.040
Uh-huh.
00:02:07.359 --> 00:02:23.439
Uh where the product identifiers come in is there is probably solving the second problem um within that, which is visibility into what is coming into the market, particularly so that they can enforce their um own uh regulations and rules and restrictions about what comes in.
00:02:23.520 --> 00:02:32.319
Um and and the changes in July for the three euro, that was just that's really just removing the duty to minimum us and put a simplified thing in place there.
00:02:32.639 --> 00:02:35.120
That was really just for low value shipments under 150 euro.
00:02:35.360 --> 00:02:40.400
But this product identifier impacts e-commerce shipments from all of all values, correct?
00:02:40.960 --> 00:02:41.840
Exactly, exactly.
00:02:42.080 --> 00:02:49.199
But it's really trying to get at the same problem of we don't have enough money and we don't have enough data visibility into what's coming in globally.
00:02:49.360 --> 00:02:56.240
This visibility problem has been an issue for all goods, not just for low value goods for the hold on, hold on.
00:02:56.479 --> 00:02:57.840
Why is there a problem?
00:02:58.000 --> 00:03:00.000
Yeah, you've you see a ton of data.
00:03:01.280 --> 00:03:10.000
Those descriptions in e-commerce are absolutely perfect in being able to identify the type of goods coming into a country, right?
00:03:10.560 --> 00:03:12.479
In in some cases they are rich.
00:03:13.199 --> 00:03:23.199
However, in many times, those get filtered through many parties before they actually get on to the to the regulators, to the customs authorities in market.
00:03:23.520 --> 00:03:32.159
Um so while there might be some uh maybe a lot of these that have rich information, um not uh it rarely makes it down to the to the entry.
00:03:32.319 --> 00:03:48.479
But even if you look at the at what's on the product listing, there's a lot of unbranded items, a lot of things that are being sold by um you know secondhand sellers that are you know don't clearly distinguish what exactly this product is.
00:03:48.719 --> 00:03:55.360
And if you're a regulator, it would make it really difficult for you to be able to say, yes, this it does or does not meet the requirements we've set forward.
00:03:55.599 --> 00:04:13.360
And I'm assuming one of these objectives too is to be able to actually run statistics and analysis, group entries, see how much of a particular product's coming in, and when you're trying to match on just a string of text that's coming from who knows how many different sellers, yeah, it it's there's it's impossible, right?
00:04:13.680 --> 00:04:16.079
And a lot of that text gets simplified and reduced.
00:04:16.160 --> 00:04:19.680
It might be like um uh animal toy.
00:04:19.759 --> 00:04:27.439
And is that a a toy that's shaped like an animal, or is that a a toy meant to be played with by your pet, right?
00:04:28.000 --> 00:04:28.480
Yeah.
00:04:29.279 --> 00:04:31.600
So there's a lot of ambiguity there as well.
00:04:32.079 --> 00:04:38.240
And and even if there were rich descriptions, a lot of times that rich description is specific to the retailer.
00:04:38.480 --> 00:04:49.680
And you know, sometimes we'll we'll see descriptions have the part numbered in the description, you know, because we're we're we uh we do customs brokerage, and so we see a lot of that, and you need to kind of extrapolate.
00:04:50.160 --> 00:04:52.800
It's very, very difficult if you don't have something something standard.
00:04:52.959 --> 00:04:55.839
Okay, so there's gonna be these standard identifiers that are required.
00:04:56.000 --> 00:05:03.040
Um and anything else uh that uh on the why you think that that's important, maybe before we go into the details of what these are?
00:05:03.279 --> 00:05:06.720
Yeah, uh specifically uh uh and if I'll I'll quote the EU commission.
00:05:06.800 --> 00:05:25.040
They say the new product identifier requirement will allow customs to obtain and use operational and supply chain traceability information to facilitate the identification on non-compliant goods, uh thereby scaling up the outcome of the control of an individual product to all products that present a similar risk.
00:05:25.279 --> 00:05:30.160
So it's really it's about security and it's about supply chain tracing.
00:05:30.319 --> 00:05:31.360
So those two.
00:05:32.000 --> 00:05:33.439
So what are these identifiers?
00:05:33.759 --> 00:05:34.639
Or identifier?
00:05:34.879 --> 00:05:35.759
How many how many are here?
00:05:36.319 --> 00:05:41.680
But wait, before we go into this, so the whole purpose is to catch non-compliant products coming in.
00:05:41.920 --> 00:05:54.879
Because I do think consumer safety is is a big part of this, a big driving factor, but they want to understand what's coming in and they want to be able to catch the stuff that's not supposed to come in, which reminds me of something that I did.
00:05:54.959 --> 00:06:04.639
You see the weather uh recently where there's there was fog everywhere, and I went out and I tried to catch the fog, kind of like these guys are trying to catch the bad guys, but I missed.
00:06:07.839 --> 00:06:09.439
Oh okay.
00:06:09.759 --> 00:06:21.040
On that note, let's dive into you know, sound sounds like the product identifiers are going to help them more explicitly group products, match products, catch non-compliant products, right?
00:06:21.199 --> 00:06:21.920
Correct, yep.
00:06:22.160 --> 00:06:26.240
And so there's three product identifiers specifically that the EU commission is asking for.
00:06:26.399 --> 00:06:37.279
Uh, the first, and this should be really simple for the vast majority of merchants, and that's their verbiage that they use merchants, the sellers, the shippers, uh, to use and to get.
00:06:37.360 --> 00:06:39.920
And that is the merchant product ID.
00:06:40.079 --> 00:06:46.319
The uh it's abbreviated MPID in the regs, but we'll just call it the merchant product ID here for simplicity.
00:06:46.480 --> 00:06:52.000
Um, and that's just your your stock keeping unit, your SKU, it could be your product ID on your e-commerce catalog.
00:06:52.240 --> 00:07:01.040
There's not a lot of um of requirements with there, but there is some guidance about what makes a a good product identifier for for the merchant to be able to do it.
00:07:01.199 --> 00:07:01.759
What's like the guide?
00:07:01.920 --> 00:07:04.399
Okay, I'm curious, like what makes a good product identifier?
00:07:04.639 --> 00:07:04.800
Yep.
00:07:04.959 --> 00:07:14.560
So specifically, they're looking to understand um all all shipments of that same item uh uh coming in from uh from from your um from you.
00:07:14.879 --> 00:07:24.000
So so so if you have a if you have a skew using the same SKU across that item, yeah, that's all they're saying is be consistent with your identifier if it's the same item.
00:07:24.720 --> 00:07:25.120
Exactly.
00:07:25.279 --> 00:07:30.560
So if you're for for instance, if you're um selling serialized goods, right?
00:07:30.639 --> 00:07:36.319
And they're they're all the same good, but maybe they're limited edition runs and you've got a serial number on each of them.
00:07:36.560 --> 00:07:41.439
What you should not do is use that serial number as your merchant property.
00:07:41.759 --> 00:07:42.720
Because it's different on everything.
00:07:43.199 --> 00:07:45.199
Even though it's really the same one, individual, exactly.
00:07:45.439 --> 00:07:45.839
It looks different.
00:07:46.000 --> 00:07:46.399
I gotcha.
00:07:46.639 --> 00:07:46.800
Okay.
00:07:47.040 --> 00:07:47.279
Yep.
00:07:47.360 --> 00:07:49.199
So so they want you to avoid that.
00:07:49.360 --> 00:07:53.360
Uh similarly, you don't want to add the lot ID or things like that to it.
00:07:53.439 --> 00:07:56.319
And they'd love these to be hierarchical in nature.
00:07:56.560 --> 00:07:58.560
So if you have variants, right?
00:07:59.759 --> 00:08:00.560
Of course they would love that.
00:08:00.639 --> 00:08:00.800
Okay.
00:08:01.199 --> 00:08:02.240
Hierarchical, all right.
00:08:02.639 --> 00:08:12.879
A blue shirt, they they you want to use the same in a red shirt, you want to have the same product ID, maybe with a dash blue at the end or a dash red, or which is fairly common in industry.
00:08:13.199 --> 00:08:18.560
But but these are sounds like suggestions on the suggestions, they're not um enforcements.
00:08:18.720 --> 00:08:23.519
However, on the the flip side, that serial one, that there they do view as a as a violation.
00:08:23.680 --> 00:08:28.800
But the hierarchy is just uh a random generator, yeah, generated ID, basically, at that point.
00:08:29.120 --> 00:08:29.439
Okay.
00:08:29.680 --> 00:08:35.519
Uh all right, so we have the the MPID, which is the merchant product identifier that the merchant knows and should be able to supply.
00:08:35.679 --> 00:08:36.799
Okay, it sounds easy so far.
00:08:36.879 --> 00:08:37.440
Okay, what else?
00:08:37.759 --> 00:08:37.919
Yep.
00:08:38.000 --> 00:08:42.879
And then there's two uh product IDs that are intended to come from the manufacturer.
00:08:43.279 --> 00:08:48.639
One is a standard product ID, and one is a non-standard product ID.
00:08:48.879 --> 00:08:54.879
So we'll talk about the standard product ID first, because that's probably easiest to understand conceptually.
00:08:55.039 --> 00:09:10.639
Um and that's simply the product identifier used and and uh registered with um it could be with like the um a UPC, a universal product code, it could be an EAN, a European article number, it could be the ISBN for books, right?
00:09:10.960 --> 00:09:12.799
So we say could be this is an or.
00:09:13.360 --> 00:09:13.679
It's an or.
00:09:14.080 --> 00:09:15.519
So they could have any of these.
00:09:15.679 --> 00:09:19.600
So we have a little family business selling Halloween costumes.
00:09:20.559 --> 00:09:27.120
And as long as we use the UPC or that identifier, that covers that number.
00:09:27.440 --> 00:09:28.320
Yep, that's correct.
00:09:28.399 --> 00:09:29.360
That would be sufficient.
00:09:29.600 --> 00:09:32.639
Um but they have to be But they need to be registered, it's a registered number.
00:09:32.960 --> 00:09:38.080
It's a registered number and it's standardized across all sellers of the identical good, right?
00:09:38.559 --> 00:09:38.799
Okay.
00:09:39.120 --> 00:09:51.679
And and that brings traceability across all exporters into the EU so that they can track the volume and understand what this commodity is by looking in those registered databases, etc.
00:09:52.240 --> 00:09:55.279
Um and so that's the standard product.
00:09:55.759 --> 00:10:05.600
Do you have to identify which one it is that's like UPC colon or EAN colon, or they'll just there's no ask to do that in the regs.
00:10:05.679 --> 00:10:10.080
Um typically those can be identified uh by the length or by the pattern.
00:10:10.240 --> 00:10:11.519
Um they'll figure it out.
00:10:11.759 --> 00:10:13.039
I'm sure that they'll be able to figure it out.
00:10:13.200 --> 00:10:14.320
Yeah, we certainly could.
00:10:14.639 --> 00:10:14.960
Okay.
00:10:16.159 --> 00:10:20.320
So that was this the S PID, right, which is the standard product identifier.
00:10:20.559 --> 00:10:20.720
Correct.
00:10:20.879 --> 00:10:21.840
Okay, so two of the three.
00:10:22.000 --> 00:10:22.159
Yep.
00:10:22.320 --> 00:10:26.240
And then the the last one is the non-standard product ID.
00:10:26.480 --> 00:10:29.919
And this um is relatively straightforward, at least in principle.
00:10:30.080 --> 00:10:36.399
It's the product identifier issued by the manufacturer that isn't necessarily registered with okay.
00:10:36.559 --> 00:10:47.039
So conceptually, if I'm thinking if I'm a retailer and I have my own product internal kind of number, a manufacturer also has their own kind of internal identifier and it's that one.
00:10:48.320 --> 00:10:54.559
So it's typically like the model number of the item that you're being that that you're that is being sold, right?
00:10:54.639 --> 00:10:56.320
So it's generally understood.
00:10:56.480 --> 00:10:59.200
Maybe it's not the the retail branding of the product.
00:10:59.279 --> 00:11:11.600
So you might call this like the you know Galaxy S10, you know, but and then the the the model for that might have um five or six letters or numbers, but it's typically listed on that same product.
00:11:12.080 --> 00:11:12.320
I see.
00:11:12.399 --> 00:11:26.960
So it's on there, it's on if you if I went to if I got a um uh a catalog, you know, of items to purchase, you know, a PDF from a manufacturer, chances are they have all of these in that catalog, in that PDF, right?
00:11:27.120 --> 00:11:31.120
Yeah, and if you go to those model numbers, if you go to their support, non-standard product identifiers, okay.
00:11:31.440 --> 00:11:41.679
If you go to the support on their website of the manufacturer's website, you'll probably have to put in the product ID or the model ID of the product to find the relevant docs and I see it's it's that product ID.
00:11:42.000 --> 00:11:47.679
This this is in reality, this this sounds complicated, but it's actually ultra simple.
00:11:48.639 --> 00:11:54.960
The EU seems like they're just saying, look, everybody's already using part numbers in the in in the course of doing business.
00:11:55.360 --> 00:11:56.320
Just share them with us.
00:11:56.399 --> 00:11:56.639
Yep.
00:11:56.799 --> 00:12:08.399
And and when it comes down to the manufacturer, Clint, if you're buying, if you're buying supplies from uh or products from a manufacturer, you have they have a part number and a catalog they're using to sell to you.
00:12:08.960 --> 00:12:17.600
Whether they went to the extra effort to register them with the UPC or AEN or whatever, um, or not, or maybe they just made up their own internally.
00:12:17.759 --> 00:12:20.559
Either way, that's the standard, you know, standard versus non-standard.
00:12:20.720 --> 00:12:22.480
But it's a part number you're ordering off of.
00:12:22.639 --> 00:12:24.000
They just want to know what that is.
00:12:24.159 --> 00:12:31.120
And then when you keep your inventory, you might assign your own part number for inventory purposes, or you might reuse that one.
00:12:31.360 --> 00:12:34.720
But either way, whatever number you're using, they want you to share that too as a as a retailer.
00:12:34.960 --> 00:12:42.240
So I could use my mer my merch my MPID, my merchant product identifier, could be the same as the non-standard product identifier.
00:12:42.399 --> 00:12:43.440
That could be a pretty common.
00:12:43.679 --> 00:12:47.200
So you just you would in that case, then you just repeat the same the manufacturer twice.
00:12:47.519 --> 00:12:52.480
So Aaron, you said something that I you said this sounds simple, but does it is this easy?
00:12:52.720 --> 00:12:56.000
So like like like what what if um what if I'm selling an eBay?
00:12:56.159 --> 00:13:02.480
Okay, so what what if like now now let's go through like the real case scenarios of is this even practical?
00:13:02.799 --> 00:13:05.200
How how are how do companies do this at scale?
00:13:05.279 --> 00:13:07.120
Like, who is this a challenge for?
00:13:07.440 --> 00:13:16.399
Yeah, because I I think in general, I think this is if I look at it from the the EU's eyes, they're like, hey, this is what's happening in the course of business, share.
00:13:16.480 --> 00:13:19.360
Now, of course, that there's always the 80-20 rule, right?
00:13:19.600 --> 00:13:20.960
And I do think that's accurate.
00:13:21.039 --> 00:13:32.399
Of like, they're not asking the industry to make up a new number that didn't exist before, they're just asking to share in their minds, they're just asking to share the numbers that already exist that are already being used.
00:13:32.639 --> 00:13:33.600
So they just want to see them.
00:13:33.679 --> 00:13:34.240
Yeah, right.
00:13:34.320 --> 00:13:35.840
That that's that's pretty much it, right?
00:13:36.080 --> 00:13:37.840
That's precisely a simple concept.
00:13:37.919 --> 00:13:38.080
Okay.
00:13:38.320 --> 00:13:40.080
They do ask for they do have some carve-outs there.
00:13:40.159 --> 00:13:41.440
So we just want to be explicit.
00:13:41.600 --> 00:13:54.559
So anything that is agricultural or perishable, I think chapters one through fifteen, these are like live animals, grain, I'm sure everybody knows what chapters, you know, one through fifteen areas.
00:13:54.720 --> 00:13:57.679
Um agricultural products that tend to be perishable.
00:13:58.000 --> 00:14:02.480
Okay, so so into the US or you know, elsewhere, just the harmonized code.
00:14:02.639 --> 00:14:08.480
The harmonized chapter, the harmonized schedule, those chapters did is that how they excluded it based on chapter.
00:14:08.720 --> 00:14:09.200
Yep, exactly.
00:14:09.279 --> 00:14:23.919
So they say anything chapters one through fifteen, those you don't need to have uh uh a PID for that, a product ID, uh, because there isn't really a uh manufacture product ID for those, right?
00:14:24.000 --> 00:14:25.279
They're they're commodities.
00:14:25.519 --> 00:14:46.559
Um similarly, if things are handmade, um they list specific headings uh headings in there, but it's like you weave your own baskets or you carve your own figurines, or you know, there's some very nuanced um um cases there where there's no um uh manufactured product ID required.
00:14:46.799 --> 00:14:55.600
And then any things that are uh art, antiques, collectible stamps, or coins, all of those would be excluded.
00:14:56.000 --> 00:15:00.000
So they're trying to find the items that you just they number would not exist, in other words, right?
00:15:00.399 --> 00:15:06.559
They're trying to, and that does capture some of those cases, but remember an antique has to be over a hundred years old to be an antique.
00:15:07.039 --> 00:15:07.440
Holy cow.
00:15:07.679 --> 00:15:11.120
So anything that's 75 years old, not an antique.
00:15:11.360 --> 00:15:14.080
Okay, so something made in 1928.
00:15:14.399 --> 00:15:16.720
You better know your 26.
00:15:16.879 --> 00:15:17.360
Yeah, yeah.
00:15:17.440 --> 00:15:17.759
Yep, yep.
00:15:17.840 --> 00:15:20.159
So 28, you need to know at 26, you might not.
00:15:20.399 --> 00:15:20.799
Yeah.
00:15:21.039 --> 00:15:27.360
So um they did contemplate marketplaces and marketplace list marketplace listing IDs in this, correct?
00:15:27.840 --> 00:15:30.159
So how how would that be used if you're selling on a marketplace?
00:15:32.960 --> 00:15:38.559
Uh merchant product ID, you can use the the marketplace identifier for that.
00:15:38.799 --> 00:15:45.200
Um if you're selling on let's say Amazon, that would be the ASIN right there.
00:15:45.360 --> 00:15:52.960
But uh it has to be a so you could use your ASIN, but that's still that's just your identity, that's not solving the non-standard or the standard.
00:15:53.200 --> 00:15:53.360
Right.
00:15:53.440 --> 00:15:54.639
That's not the manufacturer ID.
00:15:54.960 --> 00:15:59.840
That would be for the own identifier is.
00:16:00.240 --> 00:16:15.440
So if you're but but as a seller, if I'm if I'm thinking through all the different things like wait, I'm I'm an eBay seller or an Etsy seller or you know, whatnot, or wherever I'm selling, I'm going to my stock keeping unit might be my listing IDs.
00:16:15.759 --> 00:16:15.919
Yep.
00:16:16.159 --> 00:16:18.879
And that and that would be fine to use in the in the M ID, right?
00:16:19.200 --> 00:16:23.039
And that's probably the preferable one to use as opposed to one that isn't discoverable.
00:16:23.200 --> 00:16:23.279
Right.
00:16:23.440 --> 00:16:32.639
So if it's if it's something that's completely behind the scenes, that it's internal to your systems, but it never makes it onto the platform on which you sell, that might be a less good one.
00:16:33.279 --> 00:16:33.440
Okay.
00:16:33.519 --> 00:16:40.320
And then if I'm if I'm reselling something and I have the box sitting there or a tag on it or something, it might have the manufacturer ID.
00:16:40.559 --> 00:16:44.159
In most cases, they would or or I'd see the UPC code or something.
00:16:44.240 --> 00:16:49.279
And that's what I'd use as one of the manufacturer IDs, whether it be standard or or non-standard, right?
00:16:49.679 --> 00:16:56.879
And if you only have the standard ID, the EU has come out and said that that's completely fine to use that in both places, both the non-standard and the standard ID.
00:16:57.039 --> 00:16:58.080
Okay, you just so you just duplicate it.
00:16:58.240 --> 00:16:58.799
You can duplicate it.
00:16:58.960 --> 00:17:00.960
Okay, so you can use the standard ID twice.
00:17:01.200 --> 00:17:01.840
Yes.
00:17:02.240 --> 00:17:03.600
It doesn't work the other way around.
00:17:03.840 --> 00:17:08.160
It's a it's a little bit easier to find the standard ID, though, isn't it, than the non-standard ID?
00:17:08.480 --> 00:17:18.160
Yeah, if you're if you have the physical product and you're you see the barcode, for instance, that would be uh in many cases the UPC or have the ISPN on the book or or whatnot.
00:17:18.319 --> 00:17:20.079
So in many cases, yes.
00:17:20.319 --> 00:17:29.759
And then on the original packaging, you typically, not always, but you typically see a model number, um, uh or uh and that would be your your non-standard.
00:17:30.160 --> 00:17:40.000
Well, and I think even um this is where I I think it might get tricky for a seller is even non-standard product IDs are gonna be on the packaging too often from from manufacturers.
00:17:40.079 --> 00:17:42.319
They just didn't go register it, but it's still there.
00:17:42.640 --> 00:17:59.440
And then being able to know is a standard or not standard, that's where maybe some of the nuance might come in from a seller, but it sounds like probably if do your best to know, yes, and then still take that number and and share it in in one of the fields, at least the non-standard field.
00:17:59.519 --> 00:18:01.519
If you're not sure, then it's it's correct.
00:18:01.759 --> 00:18:04.160
What what happens if I create a bundle or something?
00:18:04.240 --> 00:18:05.599
Like what happens in these scenarios?
00:18:05.680 --> 00:18:11.119
Like it uh or a whole a whole lot of something on the marketplace.
00:18:11.279 --> 00:18:13.279
Yeah, like I sold a whole bunch of Pokemon cards.
00:18:13.519 --> 00:18:18.880
Yeah, so those are great questions and not well contemplated in the in the regs.
00:18:19.119 --> 00:18:25.759
I'll I'll tell you what you know, crumbs of guidance we have, and and this is how we we would approach it, right?
00:18:26.079 --> 00:18:29.759
Um, so with bundles, um, who becomes the manufacturer there?
00:18:29.920 --> 00:18:31.119
That's a really interesting question.
00:18:31.359 --> 00:18:39.920
If you're bundling products from multiple manufacturers, right, and and you you become and you put it in the same packaging and they're sold as a unit, right?
00:18:40.400 --> 00:18:45.359
Then arguably you become the manufacturer of that good, that bundle.
00:18:45.759 --> 00:18:49.599
You've created this new You've created a new SKU SKU to be sold.
00:18:50.480 --> 00:19:03.200
And so arguably, I again the the re the regs and the guidance are are relatively speaking silent on this, but um uh it would be reasonable for you to create your own non-standard product ID in in that.
00:19:03.759 --> 00:19:07.359
But but would they have to create a would they have to create a standard product ID though in that case?
00:19:07.440 --> 00:19:12.960
Like what happens with the the you know, and the UPC or though that that particular identifier.
00:19:13.279 --> 00:19:23.440
Yeah, so so uh standard product IDs that you recognize as they are an additional burden, there's some cost associated with registering those, and not all products are registered.
00:19:23.519 --> 00:19:35.279
And so they say where they exist you are supposed to put them on, where they don't now the bundle itself, there's there's different reasons why you might be reporting that at the individual piece level, right?
00:19:35.359 --> 00:19:40.960
And so instead of looking at the one bundle, you might actually be declaring those as the items within there.
00:19:41.119 --> 00:19:46.240
Though there's the GRIs used for classification that'll likely drive a lot of a lot of that.
00:19:46.400 --> 00:20:04.559
But if if they are uh you know transformed into a single bundle and you would report them otherwise on a on a customs form as a single line item, then arguably there's enough uh transformation there for you to be considered the manufacturer and for you to uh put your own uh identifier as the manufacturer product ID.
00:20:04.880 --> 00:20:06.480
So let me let me ask this question.
00:20:06.720 --> 00:20:12.480
Um I'm selling a lot of something on a marketplace.
00:20:12.640 --> 00:20:14.160
I have my marketplace listing.
00:20:15.440 --> 00:20:18.240
Does that just become my manufacturer ID as well?
00:20:18.799 --> 00:20:22.880
Um when you say lot, do you mean like a a random sample of the same?
00:20:23.039 --> 00:20:28.079
No, let's say I've just got a bunch of junk in my backyard in my shop that I'm that I'm selling, right?
00:20:28.319 --> 00:20:34.079
Yeah, and I A, if I if I can find the manufacturer ID on it and I'm selling one one piece, then I I would.
00:20:34.160 --> 00:20:36.160
But now I'm selling like a whole bunch of baseball cards.
00:20:36.880 --> 00:20:38.480
And I'm selling a whole box of them.
00:20:38.640 --> 00:20:39.119
Yep.
00:20:40.319 --> 00:20:45.279
You're saying that I if really it's it's kind of a it's a unique one-off thing.
00:20:45.359 --> 00:20:58.960
It's and does my but does my marketplace listing ID that's my that's my merchant uh identifier, right, as the seller, and then does that also persist to a non-standard uh uh manufacturer ID?
00:20:59.279 --> 00:21:00.480
So that's a great question.
00:21:00.640 --> 00:21:04.720
It's not contemplated at all in the ranks, so it's not clear.
00:21:05.759 --> 00:21:06.079
Okay.
00:21:06.880 --> 00:21:07.759
That's it, that's it.
00:21:07.920 --> 00:21:09.759
I think we can go back to the driving principles.
00:21:10.319 --> 00:21:11.599
But that's where I was gonna go with it.
00:21:11.839 --> 00:21:20.880
And so the driving principles are to provide more transparency and track and traceability across the various players in the supply chain and to provide that protection.
00:21:21.039 --> 00:21:41.759
And so uh, you know, in that case of you know, I'm I'm creating a a new product that is maybe a bundle of Pokemon cards or baseball cards or whatever that is, um, you may be able to and and you might want to um try to describe these in a way that that conveys what they are as best as possible.
00:21:41.839 --> 00:21:48.319
Um, and something that can be used across many such sellers, uh uh across platforms, et cetera.
00:21:48.559 --> 00:21:54.799
So uh what I would probably do is I would I would probably create a hierarchical um product I D there.
00:21:54.880 --> 00:21:58.640
So it might be like MLB dash tops dash, you know.
00:21:59.279 --> 00:21:59.759
So you just create
00:22:00.160 --> 00:22:00.880
You'd create your own.
00:22:01.440 --> 00:22:04.640
Again, the the regulations do not contemplate that.
00:22:04.799 --> 00:22:07.279
However, I think that's what the intent is.
00:22:07.519 --> 00:22:10.400
Um now we we are hoping for more guidance.
00:22:10.480 --> 00:22:13.920
There's still a lot of ambiguity and a lot of things unaddressed here.
00:22:14.079 --> 00:22:32.319
But if I was the regulator, I would want to have see something like that develop that's that's is common across sellers, that isn't just what Aaron made up or what Clint made up, but that that everyone that's doing this selling the same type of thing is using the same type of identifier.
00:22:32.640 --> 00:22:33.920
But it sounds like we're not there yet.
00:22:34.079 --> 00:22:34.880
That's correct.
00:22:35.440 --> 00:22:38.160
And it also sounds like you know, we use the 80-20 rule.
00:22:38.319 --> 00:22:51.039
The intent of this is it feels like they're really going after newly manufactured batches of goods that are coming in, and they're trying to target groups of products that are coming in.
00:22:51.599 --> 00:22:56.400
That's kind of the in their mind, what they're going after is like, hey, we've got a lot of this type of good coming in.
00:22:56.480 --> 00:22:58.079
Let's we we need to catch it.
00:22:58.319 --> 00:23:01.039
Or they or they want to ignore it and so they get the mass, okay.
00:23:01.119 --> 00:23:03.599
Here's all the good ones, so they can then focus in on the bad ones.
00:23:03.839 --> 00:23:07.920
And all these one-offs don't really feel like it's their primary focus right now.
00:23:08.880 --> 00:23:12.960
Certainly not their focus if you could read the regs, it's it's not well contemplated there.
00:23:13.039 --> 00:23:15.200
So how how how problematic is this going to be?
00:23:15.279 --> 00:23:20.559
Okay, so and for who come November 1st, you forget it.
00:23:21.039 --> 00:23:24.640
But what what is practically going to happen come November 1st?
00:23:25.039 --> 00:23:31.440
Um, and who are the different obviously we talked about retailers, who else is struggling with this, right?
00:23:31.519 --> 00:23:35.839
What what in whether in the logistics field or brokers or whatever, right?
00:23:35.920 --> 00:23:38.319
Like declarance, like what yeah.
00:23:38.720 --> 00:23:47.599
So so the EU talks about three uh parties that are involved in this, and and there I think there's more than the three that they talk about, but they talk about the the manufacturer, right?
00:23:47.680 --> 00:23:57.200
So is the manufacturer your duty is to be able to provide those manufactured product IDs to to anyone asking for them, to be able to provide that information and help you.
00:23:57.680 --> 00:23:59.359
Are manufacturers usually cool with that, you think?
00:23:59.599 --> 00:24:00.480
Um generally, yeah.
00:24:00.559 --> 00:24:02.960
If you're working through their distributors and whatnot, they're happy to do that.
00:24:03.039 --> 00:24:07.440
Now, if you you have something in your basement from 1928, um that's maybe nine.
00:24:08.000 --> 00:24:12.480
What if you're what if you're like one more step you what if you didn't buy directly from the manufacturer?
00:24:13.039 --> 00:24:13.279
Right?
00:24:13.440 --> 00:24:14.720
And you're selling on eBay.
00:24:14.960 --> 00:24:15.519
Yep.
00:24:15.839 --> 00:24:16.400
Yeah, yeah.
00:24:16.720 --> 00:24:23.920
You know, I mean, there the EU tells them that they should be responding uh responding to all parties that are inquiring on that.
00:24:24.160 --> 00:24:28.480
Whether that's happening in practice or not is is um is probably questionable.
00:24:28.640 --> 00:24:36.400
Uh, but if you have a direct relationship with your with the wholesaler or with the with the manufacturer, you should be able to get those from them without much effort.
00:24:36.799 --> 00:24:39.119
And and hopefully in a lot of cases, you just look at the box.
00:24:39.920 --> 00:24:41.039
The packaging it should be listed somewhere.
00:24:43.759 --> 00:24:45.359
Okay, so that that's party one.
00:24:45.519 --> 00:24:48.559
Party two is the is obviously the the merchant to the seller.
00:24:48.720 --> 00:24:54.079
Um and they're responsible primarily for the merchant product ID.
00:24:54.160 --> 00:24:59.359
Um obviously that's something that they can control or the platform that they're on can can help them provide.
00:24:59.599 --> 00:25:02.559
And the third that they talk about is the declarant.
00:25:02.640 --> 00:25:12.799
Um that's the person uh responsible, and they're the ones um responsible for all the accuracy of those IDs that are being put on any sort of entry documentation.
00:25:13.119 --> 00:25:18.079
And a declarant is, though not a perfect parallel, similar to an importer of record.
00:25:18.880 --> 00:25:19.599
It's a good mental model.
00:25:20.079 --> 00:25:24.880
It's the person taking within the EU that's taking responsibility for the the shipment.
00:25:25.200 --> 00:25:25.440
Okay.
00:25:26.480 --> 00:25:29.599
And this where is where it starts to, I think, get kind of difficult, right?
00:25:29.680 --> 00:25:36.079
Because when if it's impacting the declarant and you have someone that's non-compliant upstream, right?
00:25:36.160 --> 00:25:45.359
You're let's say you're you're you know, and so now the logistics providers are involved because they're either they're the declarant or they're working with someone that's a declarant and they know they need to solve this problem.
00:25:45.519 --> 00:25:49.519
Like, how what what are the what are the concerns out there in the industry?
00:25:49.599 --> 00:25:56.000
Yeah, and what are what what are we working to do in in the as an industry or you know, even us possibly to help solve some of this?
00:25:56.319 --> 00:26:05.839
Yeah, so it's important to call out that any any carrier, and many have come out and said this, they will not accept a shipment bound for the EU without two of those three product identities.
00:26:06.079 --> 00:26:07.599
Okay, so they're gonna make them required fields.
00:26:08.000 --> 00:26:08.319
Yep.
00:26:08.559 --> 00:26:11.759
Whether they're whatever's in there is in there, they're not validating or anything.
00:26:12.000 --> 00:26:22.880
And I think that's the key, is they they won't have mechanisms to be able to confirm the validity of non-standard product IDs or even your own main uh merchant product identifier.
00:26:23.119 --> 00:26:23.599
Right.
00:26:23.839 --> 00:26:32.160
Um now what what that means in practice is it also means that if you look at the EU um commission, they're gonna have the same challenge.
00:26:32.319 --> 00:26:38.559
These are really difficult things to to validate because they they are in fact non-standard, but they'll be keeping logs, right?
00:26:38.640 --> 00:26:40.480
They're they're gonna be collecting data.
00:26:41.279 --> 00:26:48.160
And I would expect that um how how much validation is done on that will ramp up over time.
00:26:48.400 --> 00:26:51.119
Um they won't on day one.
00:26:51.200 --> 00:26:54.559
They just they they can't they don't have the mechanism because they don't have the data yet.
00:26:54.799 --> 00:27:00.720
But over time, if they start seeing something that doesn't match a pattern, you you could be flagged.
00:27:00.880 --> 00:27:02.240
So you want to be compliant day one.
00:27:02.319 --> 00:27:02.559
Yes.
00:27:02.799 --> 00:27:11.440
And if someone isn't compliant day one, uh you should be, but chances are it's probably still getting in if there was a field that was put in there, something was put in.
00:27:11.759 --> 00:27:12.480
It it it it may.
00:27:12.559 --> 00:27:13.680
Now that's that's not advice here.
00:27:14.160 --> 00:27:14.720
No, absolutely not.
00:27:15.200 --> 00:27:16.160
Condoning that at all.
00:27:16.319 --> 00:27:22.000
We we we we should be working very diligently to be able to create these and provide these identifiers.
00:27:22.160 --> 00:27:28.079
Um, but that said, if if it's not 100% perfect, you're doing your best, I think there's going to be a lot of grace on day one.
00:27:28.400 --> 00:27:28.720
Okay.
00:27:28.880 --> 00:27:30.640
So you so you and your team, all right.
00:27:30.720 --> 00:27:36.559
This is a problem for you guys too, because customers are coming to you know and asking, hey, um, how do I solve this at scale?
00:27:36.799 --> 00:27:42.319
What what are what are some things on uh um uh ways to solve this at scale, would you say?
00:27:42.480 --> 00:27:42.960
Yeah, yep.
00:27:43.039 --> 00:27:46.160
So and and for who, like who would that be relevant to, possibly?
00:27:46.400 --> 00:27:46.960
That's a great question.
00:27:47.039 --> 00:27:59.519
I think there's there's two classes of of parties here that are interested in making sure that when in in the 20% of cases where there isn't a clear answer that we still can help facilitate compliant trade.
00:27:59.680 --> 00:28:02.799
Um the the first one is the carriers themselves, right?
00:28:02.960 --> 00:28:17.119
So if if uh if I'm um let's say I'm FedEx or I'm you know um Royal Mail or I'm um you know even USPS, I want to be able to facilitate shipments into the EU, and I don't want to see my volume decline.
00:28:17.200 --> 00:28:26.720
So I want to be able to provide tooling and and help to anyone that that might want or need um assistance to to find these type of product identifiers.
00:28:27.200 --> 00:28:30.000
Um and so what what does that look like in practice?
00:28:30.160 --> 00:28:36.559
Um uh ideally I would be able to have some type of um mechanism to to search for a commodity.
00:28:36.640 --> 00:28:49.519
So if I if I don't know, if I if I know for instance, hey, this was a a um a figurine, maybe it's a doll made in the in the 1990s, and here's the attributes of that doll.
00:28:49.839 --> 00:28:57.039
If I can go and find a database and start to search through these, that and I can extract that product, that would be really helpful.
00:28:57.119 --> 00:29:10.000
And I could be able to facilitate a lot more compliant trade by providing tools to the people that use my services as a carrier so I can continue to see volume there into the EU and and and facilitate that that compliant trade.
00:29:10.160 --> 00:29:12.960
So that would maybe be one example of an interested party.
00:29:13.200 --> 00:29:21.200
A second example would be a um, let's say it's a um a platform, uh, e-commerce platform, right?
00:29:21.759 --> 00:29:26.079
A platform, a marketplace, just a big that that someone's putting out listings.
00:29:26.480 --> 00:29:26.880
Precisely.
00:29:26.960 --> 00:29:27.279
Yeah.
00:29:27.440 --> 00:29:28.079
Precisely.
00:29:28.240 --> 00:29:44.880
Um, you know, you think there's many such um of these that um work with and uh maybe they're secondhand goods, maybe they're um goods that are have are uh have been used or restored or otherwise fall on that 80 per or that 20 percent that is a little bit harder to do.
00:29:45.039 --> 00:29:58.400
Um uh we would be able to help provide um a mechanism to to essentially perform that same type of search functionality, but at scale, uh, and to help their their sellers identify that these these in fact doesn't have to be.
00:29:58.720 --> 00:30:03.599
How do I get my listings out quickly without friction is the problem you're we're trying to do?
00:30:03.839 --> 00:30:10.160
So so it just helps the sellers be more efficient at coming up with the identifiers and be more accurate in accuracy.
00:30:10.559 --> 00:30:23.440
And and and and that's the thing is you know, the the harder, the easier you can make these types of um compliance pieces of information to to be able to search, provide, and then surface, the more compliant the trades.
00:30:24.319 --> 00:30:33.200
It's completely different, but it also feels similar in in practice and in helping a seller to classify their goods with a HTS code, right?
00:30:33.359 --> 00:30:34.960
It's the same principle of like let's something.
00:30:35.920 --> 00:30:37.440
Yeah, let's help you let's help you.
00:30:37.519 --> 00:30:42.559
And and that's the kind of thing is that let's help you find the the right ID for your products to be compliant.
00:30:42.960 --> 00:30:43.759
That's precisely right.
00:30:43.839 --> 00:30:53.200
And we don't want a hundred different entities trying to solve the the lot problem in a hundred different ways, because that is really um antagonistic to the goal of the EU.
00:30:53.759 --> 00:31:08.960
We really want to be able to help facilitate hey, that when Aaron goes and sells his lot of cards, and when Quint sells his lot of cards, and when I sell my lot of cards, that we're all creating those identifiers in the same way that that'll be able to facilitate ultimately the EU's goal.
00:31:09.200 --> 00:31:14.559
So even helping create identifiers in certain situations, yeah, where where they truly don't exist, right?
00:31:14.720 --> 00:31:17.920
We don't want uh a hundred different entities doing the same thing in a hundred different ways.
00:31:18.240 --> 00:31:25.680
And it seems like you know, there's a third party that you that that uh would make a lot of sense, and it's the one that wants to validate the numbers that are coming in, right?
00:31:25.839 --> 00:31:27.519
So the EU, right?
00:31:27.759 --> 00:31:50.160
Uh um wanting to validate these identifiers, the same model that I mean, we've built out so many different AI models with Classify and ECCN and other things could be used for flagging possibly um goods that don't seem to uh have a valid ID or it doesn't seem to match the description or something like that.
00:31:50.480 --> 00:31:51.359
Yeah, that's precisely right.
00:31:51.440 --> 00:31:57.759
So the same the same tooling that is used to help surface information can also be the tool that's used to help validate information.
00:31:57.920 --> 00:32:00.880
And there's a few different ways you can seek to validate that.
00:32:01.119 --> 00:32:04.880
One I'll call the in at the individual parcel or the line item level.
00:32:05.039 --> 00:32:12.880
You can look at that line item, the description of that line item, the the product IDs, and you can say, hey, do these appear to be correct?
00:32:13.039 --> 00:32:16.480
Um and you can do that with a database of information um that you have.
00:32:16.720 --> 00:32:22.079
But uh the second, and I think also even more powerful, is the is the longitudinal view of this, right?
00:32:22.319 --> 00:32:40.000
So you can create a lot of statistical patterns on what type of uh uh product IDs you're seeing being transmitted by certain entities in certain cases, and that can build a lot more confidence that this is a compliant actor or this is someone that is has has um mailed it in, so to speak.
00:32:40.240 --> 00:32:41.759
Yeah, fascinating.
00:32:42.000 --> 00:32:53.200
Okay, so I've got I'm a seller, I'm selling my goods, this new law comes in, I know my product ID or I use tools to help me come up with all the IDs I've got.
00:32:53.440 --> 00:32:53.759
Great.
00:32:54.160 --> 00:32:56.240
I'm compliant now because I have the IDs, right?
00:32:56.720 --> 00:33:02.720
But I I actually need to be able to get them there, and that that's where I think some of the disruption might come into play.
00:33:02.799 --> 00:33:09.119
It's because look look at the 80% already, the 80% already has their product IDs, but now they have to be able to share them.
00:33:09.519 --> 00:33:11.279
And this is easy, Aaron.
00:33:11.440 --> 00:33:12.480
You just how do you do that?
00:33:12.799 --> 00:33:22.640
It just, you know, it's gonna I'm sure all the shipping platforms are gonna have three different fields for your you know, MPID, your end pit, and your SPIT, right?
00:33:22.720 --> 00:33:24.319
That's just all of them.
00:33:26.720 --> 00:33:27.839
So what are you gonna do?
00:33:28.079 --> 00:33:28.640
I don't know.
00:33:28.880 --> 00:33:39.680
What do you how how how how is this because I actually think operationally that's probably the biggest disruption right now in the in the because this hasn't been I mean, we're talking months, not years here for everyone to prepare.
00:33:39.759 --> 00:33:42.000
This has probably been off the radar for a lot of people.
00:33:42.240 --> 00:33:46.000
I know in the postal stream, there's no I mean, getting those fields updated.
00:33:46.079 --> 00:33:52.400
I I was just listening to some information on that of basically like throw it into one of the existing fields they got and hope it works.
00:33:52.480 --> 00:33:53.359
Um, kind of thing.
00:33:53.519 --> 00:34:02.160
Like it's not an explicit field for this yet because they haven't been able to update their their their systems field to support these specific identifiers.
00:34:02.319 --> 00:34:02.799
Yeah.
00:34:03.119 --> 00:34:06.640
So what is going on in the industry operationally to be able to support this?
00:34:06.960 --> 00:34:07.200
Yep.
00:34:07.279 --> 00:34:12.639
So it it depends on the the the shipping platform or or relationship you have with the carrier themselves.
00:34:12.719 --> 00:34:16.559
Um many of the express carriers have already introduced these fields and are accepting them.
00:34:16.719 --> 00:34:20.719
So if you work directly with an express carrier, I think you'll be in good shape.
00:34:20.960 --> 00:34:23.360
So that's where if if I'm not sure, talk to my rep.
00:34:23.599 --> 00:34:24.079
Talk to your rep.
00:34:24.320 --> 00:34:25.360
They'll give me the instructions I need.
00:34:25.519 --> 00:34:25.679
Okay.
00:34:26.000 --> 00:34:26.239
Yep.
00:34:26.320 --> 00:34:31.519
Um, if you work with a shipping platform, there's that's a much larger um group uh there.
00:34:31.760 --> 00:34:37.199
And it really talk with them, make sure that they are able to receive those fields and they can map them to you.
00:34:37.280 --> 00:34:49.920
But to your point, there are some entities that are um large uh carriers uh in the like for example, the postal stream where where there is no dedicated field that it takes a an industry body essentially to be able to go and modify.
00:34:50.559 --> 00:34:57.679
But this is where I could if I'm working with a shipping platform, I talk to them, they're gonna worry about mapping to the carriers as needed.
00:34:58.000 --> 00:35:05.360
I need to work with them to ask them how do I map my database to you, and they'll take care of the rest, assuming they're preparing for this.
00:35:05.440 --> 00:35:12.639
And I'm I'm sure so uh many of them are, but there may be some that aren't ready, and that's where you need to have a conversation with with your suppliers.
00:35:12.880 --> 00:35:18.239
And and and now in our case, because we do a lot of it's into the US, there might be a channel integration in place, right?
00:35:18.320 --> 00:35:24.239
Meaning somebody connected their eBay account, their Etsy account, and if a lot of those identifiers are there, we're gonna pull them in, right?
00:35:24.400 --> 00:35:29.119
Come to the US, but function same similar functionality, that Japan retailer, right?
00:35:29.280 --> 00:35:54.320
That's selling to the US, that data can be then supplied even outside of that data stream with the like if they if they were unable to get it, let's say, into um uh you know, into a shipping platform or get it passed to uh you know Japan Post or something, we can supply that data to the to the end um uh you know broker into the EU.
00:35:54.480 --> 00:35:56.480
Would that be a right way, a good way to describe it?
00:35:56.719 --> 00:35:57.519
Yeah, absolutely.
00:35:57.760 --> 00:35:59.679
In fact, we do that for many of our customers today.
00:35:59.840 --> 00:36:03.039
So um we we do help customers sell cross-border.
00:36:03.119 --> 00:36:08.079
Um we sync through our product catalogs, we uh handle checkout, and we help you print labels.
00:36:08.239 --> 00:36:15.199
And in those situations, we're able to make sure that that information gets straight onto the onto the label and and ultimately to the broker.
00:36:15.440 --> 00:36:25.280
There are further situations where we have more information that where we don't uh aren't in the label flow, and and in that case, we're we're happy to be able to help provide help facilitate that to the to the right end party.
00:36:25.440 --> 00:36:25.840
Yes.
00:36:26.159 --> 00:36:32.639
Any anything else on this uh um that we forgot today that you want to mention around product identifiers?
00:36:33.119 --> 00:36:39.199
Uh and there has been a lot of disruption over the past 12 months, but you know, November 1st, we got some more coming.
00:36:39.280 --> 00:36:40.239
So yeah, yeah.
00:36:40.400 --> 00:36:44.559
And and you know, the you would say that this has been out since July 1st.
00:36:44.639 --> 00:36:46.400
You've been able to provide this information.
00:36:46.639 --> 00:36:55.119
I think what we've seen is that um that typically doesn't happen until it's it's what percentage of shipments would you say in the postal streamer right now?
00:36:56.000 --> 00:37:13.679
I would say in general, total if you had to guess, and I I know this is a wag, how many what what percentage of participation do you think there has been since July 1st in this in this tension period, this optional uh period?
00:37:14.559 --> 00:37:16.400
It's likely under five percent would be my.
00:37:17.199 --> 00:37:23.039
I think everybody uses November 1st as as the deadline uh that that they're all working to meet, right?
00:37:23.280 --> 00:37:24.079
Um which I agree.
00:37:24.159 --> 00:37:26.000
I mean, I think July 1st came really fast.
00:37:26.239 --> 00:37:31.440
Um and so everyone's kind of been gearing up to be to be ready to start transmitting this um before November 1st.
00:37:31.519 --> 00:37:38.079
But I think that's important to note that look, if you've got the systems in place, start doing this before November 1st.
00:37:38.400 --> 00:37:38.559
Yes.
00:37:38.880 --> 00:37:39.119
Yes.
00:37:39.519 --> 00:37:42.480
It's the the pipeline's there for for the EU to receive it.
00:37:42.559 --> 00:37:43.599
It has been for months.
00:37:43.760 --> 00:37:48.159
Don't wait until and push a release out right on right for November 1st.
00:37:48.320 --> 00:37:55.039
Push it out early and get it moving, get the holidays coming, get get your systems up and operational, then November 1st is just a formality.
00:37:55.519 --> 00:37:56.000
Absolutely.
00:37:56.559 --> 00:37:57.280
Makes a lot of sense.
00:37:57.440 --> 00:38:01.840
Hey, well, thanks uh for another insightful episode today, and uh looking forward to the next one.
00:38:02.000 --> 00:38:03.039
See you guys.
