Nearshore Services Make Better Sense for Business

Nearshore manufacturing is when a business expands operations or manufacturing to a nearby country, usually one sharing a border with the business’ country. Compared to offshore manufacturing—when a business outsources to a distant country—nearshore manufacturing offers a host of benefits for U.S. companies, as well as foreign companies that want to operate in North America. Mexico’s proximity to the U.S. is one of the main advantages of nearshoring operations.

Faster, More Convenient Shipping

Years ago, manufacturing in China was so inexpensive, it made up for the many drawbacks of moving operations so far away. Now, Mexico’s labor rates are actually lower than China’s, but that’s far from the only reason that nearshore manufacturing is the better choice.

Even if all other manufacturing costs in Mexico and China—labor, overhead, administrative services, real estate—were the same, Mexico would come out ahead when it’s time to ship the finished goods. In many cases, companies can offer next-day or same-day delivery from a facility in Mexico to U.S. customers. Shipping from Mexico is also far cheaper and more flexible. To ship goods from China, you’re generally limited to filling 40-foot shipping containers or paying a premium to ship smaller quantities. Shipping from Mexico allows you to use pallet or box quantities when needed.

Easier Travel & Communication

It’s also easier to visit your Mexican facilities whenever needed. A trip to China would involve at least a full day of traveling there and back, incur higher costs, and require advance planning to make arrangements and secure visas. Communicating is much simpler too—a factory in Mexico would be at most three hours ahead or behind a business' headquarters in the U.S., so emails and calls will get answered faster and scheduling conference calls will be less of a hassle.

Favorable Trade Agreements

Thanks to USMCA, other trade agreements, and Mexico’s IMMEX / Maquiladora program, U.S. companies can also save on duty rates when importing and exporting goods to and from Mexico. If your target market is in North America, this can provide significant cost savings. The IMMEX Program allows for goods and raw materials to be imported into Mexico. Companies can also source supplies and raw materials in Mexico. As various manufacturing industries have grown in Mexico, the industries that support and supply them have grown too.

What Is a Mexico “Shelter”?

The shelter program in Mexico is designed to reduce risk and liability for foreign companies. Instead of setting up your own legal entity in Mexico, you can run your manufacturing under one owned by IVEMSA. We’ll handle all the permits and licenses, lease your facility, and take care of administrative responsibilities like HR and accounting. You get to focus solely on manufacturing and will maintain complete control over your processes and production.

Learn more about IVEMSA’s shelter program >

DID YOU KNOW?

Businesses can save up to 30% on labor costs by manufacturing in Mexico?

Download our free Mexican Manufacturing Cost Fact Sheet to learn how much you can save on labor, real estate, utilities and more.

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Reduce costs.
Retain quality.
Gain peace of mind.

Contact us today and see how we can help you take advantage of all the benefits of manufacturing in Mexico - without the hassle.