When scouting locations for their companies, business owners hear a lot of terms being used as selling points. While many are familiar, some can be confusing, especially when even those using the phrases can’t adequately explain them.
For example, high on the list of oft-misunderstood expressions is Foreign-Trade Zone. Although of great benefit to countless business owners, most have only a vague idea of its meaning. If you’re in that number, allow us to clarify.
A Foreign-Trade Zone (FTZ) is an area in, or near, a U.S. Customs entry port, which has been secured, and designated as a storage, processing, shipping, manufacturing, or assembling site for companies that deal in international trade. Although technically within this country’s borders, regarding Customs duty, it is considered to be outside the United States.
Therefore, until they’re transferred from the FTZ for U.S. consumption, imported goods will remain duty-free, as will those that are directly exported from the zone.
The Foreign-Trade Zone Board may also permit companies to manufacture goods within the FTZ, before dispersing them for U.S. consumption, at either the duty rate of the finished products, or their imported components, whichever is lower. Furthermore, there will be no duty charged for damaged merchandise that’s destroyed within the FTZ. Companies can also profit by transferring from zone to zone with their suppliers, customers, and similar facilities.
So, if your company trades internationally, a Foreign-Trade Zone can be valuable to your business, cost-wise, as well as logistically. In addition, if you’re located near, or are planning to move to, the Pittsburgh area, Value Properties at the Ambridge Regional Distribution and Manufacturing Center may just be the ideal spot to set up shop.
For more information, call Gene or Debi, at 724-266-4661, or visit ambridgeregional.com.