How a Mexico Shelter Company Sets U.S. Manufacturers Up for Success

U.S. manufacturers have the unique benefit of working with Mexico shelter companies to create a seamless transition when launching production in Mexico for the first time.

Though there are always initial questions to evaluate the best business route, recent tariff talk has led to more questions regarding compliance. Manufacturers are particularly interested in whether their products will be deemed USMCA compliant.

Since Mexico is part of the USMCA, qualified goods under this trade agreement can be imported into the U.S. with 0% tariffs, as per the April update from the U.S. administration. However, to meet these qualifications, manufacturers must correctly categorize their products and be ready and willing to make adjustments in accordance with the Harmonized Tariff Schedule (HTS).

This process takes time, research, and customs expertise to complete correctly. It is one of the many ways Mexico shelter companies have helped U.S. and other foreign manufacturers reach their production goals in a cost-effective, timely manner.

To spearhead a strong start, here are the steps taken to ensure a successful setup:

1. Ask Qualifying Questions

In the early stages, a shelter company will ask qualifying questions to provide options that best align with a manufacturer’s specific growth goals. These include:

• What are you planning to build?
• What does production look like?
• What goods, materials, and equipment will you be importing?
• What is the intended finished product?

All of this helps to determine whether it’s best to create a standalone entity, implement shelter services, or a combination of both.

2. Work Closely with U.S. Customs Brokers

To ensure USMCA compliance, the customs process requires a bill of materials complete with a description of each product being imported plus pictures categorizing components to determine duty pricing.

A shelter company evaluates this with a U.S. customs broker, who determines if products qualify under USMCA compliance or if they need to be changed in any way. These details are important when calculating costs and for staying on schedule for setup.

3. Handle Administrative Responsibilities

Additionally, Mexico shelter companies further streamline the setup process by establishing industrial leases, connecting utilities, and handling all administrative responsibilities necessary for production to begin. This includes taxes and accounting, human resources and recruiting, as well as local government and legal compliance.

By delegating these tasks to a shelter company, it alleviates time and stress for manufacturers, allowing them to fully focus on production. Furthermore, manufacturers maintain complete ownership and control over their production, processes, and intellectual property.

Setting a Strong Foundation with a Shelter Company

Setting up production in a foreign country is a complex process. It’s beneficial to have local experts who understand everything needed to launch production quickly and efficiently. Working with a Mexico shelter company reduces setup time from six to seven months to three to four.

However, since not every manufacturer is an ideal fit for the shelter services model, IVEMSA evaluates all options and makes recommendations based on each company’s unique goals. This encourages a strong partnership from the beginning and sets the foundation for manufacturers to be successful.

To speak with one of our team members about how best to set up production and ensure USMCA compliance, contact IVEMSA today.