NEW YORK — If terrorists smuggle a weapon of mass destruction into the U.S. through a shipping container, even if the bomb is defused, the collateral damage could wipe out the brand equity of the company whose container was used.
This story first appeared in the December 17, 2002 issue of WWD. Subscribe Today.
That’s one of the messages security experts are starting to hammer home to importers as the Customs Service labors to increase the security of the 11 million, 40-foot cargo containers that enter the U.S. each year. For months, companies have been signing up for the Customs-Trade Partnership Against Terrorism, a program put in place after the Sept. 11, 2001 terrorist attacks.
While many importers have looked to the program as a way to ensure quick processing of their goods in exchange for advance declarations to Customs of what they’re shipping and a stepped-up security program, Customs officials continue to hammer home the message that the program is really about protection. While the program’s mission is to protect the country from terrorists, industry observers noted that participating is also important to companies that want to protect their names.
“Think about [the effect on] your brand if there’s a problem with something in your container,” said John Pelligrini, a partner in the New York law firm Ross & Hardles. “The issue is security, but it’s not all altruistic. You have to protect your assets and one of the most important assets is your brand.”
The thinking is that just as people around the world were overwhelmed with images of the American and United Airlines planes flying into the World Trade Center following the Sept. 11 attacks, if a particular brand’s container was used in a terrorist attack, that brand name would become strongly associated with destruction.
Richard Di Nucci, a program manager for C-TPAT, said importers should consider this question: “What happens if my container goes boom?
“The impact is not going to be between you and Customs, it’s between you and all the other businesses out there who suddenly can’t move their containers,” he said.
He urged importers who participate in C-TPAT to remember that, while the program does promise some faster processing of goods, that is not is primary mission.
“C-TPAT is about security,” he said. “It is not a benefit program…and it’s about your business.”
Experts said that even an ultimately false threat could do significant damage to the U.S. economy if cargo containers ground to a halt as Customs had to conduct hundreds or thousands of inspections.
Still, Peter McGrath, president of J.C. Penney Purchasing Co., said importers need to plan for the possibility that a terrorist incident or threat will bring shipping to a halt.
“You need to have a plan and contingency in place if there is a catastrophe at our ports,” he said.
Raymond Li, Deputy Commissioner of Customs at the port of Hong Kong, said at a recent New York meeting of apparel importers that companies need to understand that without physical security, they will not be able to conduct business normally.
“The goals of trade and economic action cannot be achieved in the absence of a secure environment,” he said.
Everyone involved in the distribution of merchandise needs to remain vigilant against terrorist threats, he said.
“No economy can alienate itself from the barbaric desolation of terrorists unless we shut up our borders,” a move that would be devastating to trade, he said. “While Customs plays a crucial role, business plays an equally important role.”
Robert Bonner, Commissioner of the U.S. Customs Service, said he took hope in the fact that more than 1,000 importers have signed up for the C-TPAT program.
“The response to C-TPAT tells me that many businesses recognize their role and their responsibility in the fight against terrorism,” he said. “I want the senior managers to know there are benefits from the improvement of security in the supply chain.”