Customs moves up agenda as Europe firms stay reactive

A survey of European manufacturing and retail companies has found that customs and trade compliance are rising up the corporate agenda as firms contend with geopolitical disruption, market volatility and tighter regulation.

Research commissioned by Customs Support Group found that 44% of respondents now see customs as a strategic priority. Many also reported gaps in staffing and specialist knowledge. Outsourcing remains common for day-to-day clearance work, while planning for disruption varies widely.

Customs Support Group analysed responses from almost 200 companies across Europe, focusing on how businesses organise customs tasks and respond to external shocks.

Strategic shift

Nearly 44% of companies reported that the importance of the customs function has increased, including 18.5% who described the rise as significant. The results suggest growing board-level attention to customs management as trade conditions become less predictable.

John Wegman, chief executive officer of Customs Support Group, said the findings show competing pressures on companies with cross-border supply chains.

"The survey shows a paradox. Customs and trade compliance is more important than ever, but many companies are understaffed in this area and act reactively rather than proactively," Wegman said.

Outsourcing reality

Despite the growing profile of customs, 70% of respondents said they outsource operational customs clearance, citing limited internal resources and a shortage of specialists.

More than a third (38%) said a lack of specialised customs knowledge was the main reason for outsourcing. Another third cited insufficient capacity, while just under 30% said outsourcing was more cost-effective. Others pointed to access to digital tools and support in keeping up with regulatory changes.

The staffing figures suggest caution about building internal teams. While 23% hired staff in customs compliance departments over the past two years, only 6% plan further recruitment. A majority (58%) reported no plans to expand.

Wegman said external advisers and brokers often play a longer-term role in customs strategy, rather than simply handling paperwork.

Classification gaps

The survey points to a split between tasks companies outsource and those they keep in-house. While third parties often handle customs declarations, goods classification more often remains internal.

Some 60% said they classify goods entirely in-house, and a further 20% use a mix of internal expertise and external support. However, confidence was lower than the level of ownership suggests: only 30% reported high confidence in their classifications.

Review practices were also uneven. Around one in three companies review classifications annually, while another third have never conducted a review.

That combination leaves many businesses exposed. More than half (56%) reported misclassification risks, and 28% said they have already seen negative impacts, including higher costs or customs audits.

"This discrepancy between responsibility and review practice is worrying," Wegman said.

He added that limited internal capacity can push companies towards partial outsourcing of classification work, and linked misclassification to additional payments, audits and operational delays.

AI caution

Use of artificial intelligence for classification remains limited. No respondent said it relies entirely on AI for classification. Only 24% use AI regularly or occasionally for goods classification, while 55% do not use it for these tasks.

Wegman said companies are wary of automating decisions that carry compliance risk and potential penalties. He added that firms still see a role for technology in data consolidation and analysis, while leaving final decisions to specialists.

Disruption response

Respondents cited the Russia-Ukraine war as the most significant external disruptor (32%), followed by the Red Sea crisis (23%). More than 21% pointed to US tariff tensions.

Many companies reported limited action in response. More than 40% said they have not implemented measures linked to geopolitical tensions, and 75% reported no response to global tariff tensions.

The results suggest wide variation in planning maturity. One in three described their approach as mainly reactive, taking action only once issues arise. Around 10% said they remain largely passive and rely on external support. Only 18% reported a forward-looking approach, with proactive planning for trade and regulatory disruption.

Wegman warned that options may shrink as rules tighten and enforcement increases.

"This is not sustainable," he said. "Looking ahead, a reactive approach is unlikely to remain viable, as regulatory pressure, enforcement intensity and geopolitical volatility are expected to force more proactive and structured responses."