ClearCross, the Reston, Va.-based international trade software firm, is trying to differentiate itself from its brisk competition by expanding the definition of trade management software. ClearCross is one of several firms offering services that automate compliance aspects of international trade. Its software, as well as that of many of its competitors, helps companies reduce costs associated with complying with customs and export-control rules in the U.S. and other countries. ClearCross is refining that idea by automating other country regulations, such as environmental rules, that are not directly associated with customs but could become an issue at the border if a rule has been violated. In effect, ClearCross is trying to expand the definition of international trade software services to include not simply logistics but virtually any piece of regulatory information a company requires to do business in a particular foreign market. Firms conceivably would need this information not just when they're exporting, but when they're designing a product in the first place, company officials say.

'You have to prove your value from design to delivery,' said Pano Anthos, ClearCross co-founder and executive vice-president.At the design level, Anthos said that if a manufacturer uses components that are restricted in another country, it could cause compliance problems later when the goods are exported. That's one area where ClearCross's trade content can provide significant savings, he said.

'How does a global manufacturer know what to design for other countries?' Anthos asked. 'Our tools can query databases in the design process early on, as well as in procurement and fulfillment.'

Bruce Johnson, ClearCross president and chief executive, said one of the company's clients is a large paint manufacturer that designs coatings for consumer products as well as aircraft and automobiles. Since many pigments and other ingredients have limitations in terms of which products they can be used with, ClearCross regulatory engines have helped the company develop and design formulas that will pass regulatory muster.

Where does all that back-end data -- which varies from country to country, is highly technical and extremely hard to find -- come from? Anthos said ClearCross employs domain experts, toxicologists, lawyers, analysts and others that have expertise in the vertical markets in which ClearCross operates. This is no different from the original customs and export data ClearCross and other firms developed by hiring former U.S. Customs and Commerce Department officials familiar with the minutia of harmonized codes and denied party screenings.

In some cases, ClearCross exchanges data with clients to build databases. Sometimes it uses royalty agreements to license and distribute trade data.

'Our customers like Dell, EM Industries and BA Am-oco have built content and information, but we dig very deep for data,' Anthos said. 'Because gathering data is such an ugly process, it is a barrier to entry in this industry.'

Johnson said the company is focusing its strategy for selling such content on five vertical markets -- chemicals, energy, high-tech, pharmaceutical and consumer packaged goods.

To bolster this strategy, Clear-Cross announced a merger last Nov-ember with Atrion International, a developer of web-based software solutions for automating environmental, health and safety data.

Johnson said that he is not interested in the type of outsourcing deals, such as taking on a client's entire global trade department, that competitor Vastera has engaged in. Vastera took over Ford Motor Co.'s compliance department. He is concerned that such arrangements can bog down company resources and be a turn-off to other potential clients in the same industry.

'If I went down that road, how would I scale my business for the next two years?' he asked. 'Some companies are trying to get rid of their old departments while they move to the Internet. That service model is a repellent to others in the same industry.'

Despite the recent carnage in Internet and technology stocks, Johnson said that there are several reasons why ClearCross is on solid footing. The first is its global reach; 600f the company's revenue comes from clients in over 20 countries outside the U.S., making it immune from any one nation's 'hiccups,' he said. Another reason is the fact that ClearCross saves money for its clients, in one case over $40 million annually in supply-chain costs.

David A. Biederman covers logistics and regulatory aspects

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