Near Shore Advantage: The Mexican Manufacturing Company Growth Spurt
While security concerns continue to create some caution for new entrants as a Mexican Manufacturing Company, once discovering the facts along with clear benefits to near shore production, many foreign corporations are choosing to capitalize on Mexico’s advantages. The country’s proximity to the U.S. and Latin American markets reduces freight expense, minimizes supply chain disruptions and draws on an inexpensive labor force. Due to market closeness, there is also the faster response time. Mexican manufacturers pose huge advantages in the speed-to-market category. Plus, it reduces production lead time which further controls costs for a Mexican manufacturing company.
Along with shorter development and production cycles, Mexico offers enormous operations flexibility as well. Foreign direct Investment (FDI) rose 9.7% in 2011 to a whopping $19.44 billion, undercutting the violence image Mexico still must contend with. Steve Colantuoni, corporate marketing director for the Offshore Group states that “….Mexico’s violence is characteristically cartel versus cartel. It (is something that) has not had a very large amount of leakage into civil society, nor has it affected, in a noticeable way, the companies that are already doing business there.” He goes on to say that, on balance, a Mexican manufacturing company is in a position to increase production efforts within an economic environment that is growing by 4.5% by 2012 and creating 1.8 million jobs along the way.