Manufacturing in Mexico Steadily Rising

April 23, 2013

Mexico manufacturing has gained a competitive edge over many other low-wage manufacturing countries. Though it is often viewed in a negative light, due to the attention brought by drug violence, manufacturing in Mexico is a key factor in changing this image and showcase Mexico as a trustworthy investment.

Mexico’s recent success, over its long time competitor China, is largely driven by wage inflation in China and Mexico’s business friendly programs, such as IMMEX (or formally known as the Maquiladora Program).  Also, Mexico currently participates in 12 free trade agreements that involve 44 other countries. NAFTA being one of its biggest acts has boosted Mexico’s economic productivity, in regards to manufacturing in Mexico, due to its close proximity to the United States and Canada.

Mexico’s appeal comes from other sources, too.  It is one of few manufacturing countries that offer shelter services, which can enable foreign investors to enter into Mexico with no legal liability and gain access to immediate knowledge about how to operate in Mexico.  A good shelter company will provide 100% of the administration and compliance management at the factory so the manufacturer can focus on production and quality control.  Typically the functions handled by the shelter company are human resources, accounting, import/export and environmental, health & safety.  Some shelter companies, such as North American Production Sharing (NAPS), offer additional services that include sourcing, technology and more. A reputable shelter company can truly make manufacturing in Mexico a seamless process.

North American companies are acknowledging the benefits of manufacturing in Mexico and noting the simplicity of doing business with their neighboring counterpart.