5 Good Reasons To Consider Manufacturing In Mexico
An increasing number of Fortune 1000 companies are moving manufacturing to Mexico. It’s a prime manufacturing location for many reasons.
1. Short Supply Chain
When you nearshore, you benefit. Mexico is right next door to the US and Canada, so the supply chain is much shorter than one with an overseas manufacturer. A short supply chain means:
- Faster shipping times, with some shipments arriving in as little as a day via truck. Compare this to oceangoing cargo that can take several weeks.
- Lower shipping costs, as the cargo is handled fewer times and travels a shorter distance.
- Smaller shipment options. Order cargo by the pallet rather than by the container.
Supply chain benefits are often underrated in the procurement process. However, they are important in modern manufacturing.
2. Low Labor Costs
Here’s a valuable fact: Mexico’s labor costs are among the lowest in the world. And unlike labor costs in a lot of other countries, Mexico’s labor costs have been steady over the last 20 years. Labor is a significant portion of manufacturing costs, even in highly-automated processes. Lower labor costs almost always make for lower production costs.
For US and Canadian companies, the combination of low shipping costs and low labor costs makes Mexican manufacturing a slam dunk. (More about labor costs by country in this article.)
3. Socially Responsible Manufacturing
The US and Canada have some of the best labor and environmental laws in the world, so it’s only natural for a US or Canadian company to seek out a manufacturer that treats its employees fairly and protects the environment. A good option? Mexican manufacturing.
Mexico has labor and environmental laws that mirror those in the US and Canada. These laws are enforced consistently, ensuring that products manufactured in Mexico are socially responsible. At a time when social media can amplify any problem in a corporation’s supply chain, socially responsible manufacturing is smart business.
4. A Large Pool Of Skilled Labor
Many people in the United States are surprised to learn that Mexico has more engineering, manufacturing, and construction degrees per capita than the United States. This is a tremendous advantage for Mexican manufacturers, as it makes it easy for us to hire smart, capable workers that can ensure top quality production.
5. Respect For Intellectual Property
Mexico’s intellectual property laws are similar to those in the US and Canada. While that might seem like “no big deal,” it puts Mexico above most other countries where manufacturing is commonplace. That’s because, in addition to having stringent IP protections encoded in our laws, we also have a legal system that’s friendly to foreign business. When outsourcing to a Mexican manufacturer, US and Canadian companies can rest assured that their intellectual property will be protected.
If your company is interested in learning more about manufacturing in Mexico, you might find the following articles useful: