Why Using Shelter Services Accelerates New Operations in Mexico
10.20.19
Manufacturing in Mexico continues to be a popular option for U.S. and other foreign businesses that want to expand their operations at a lower cost, while still maintaining high-quality production. Successfully launching a new manufacturing facility requires several steps, many of which must run simultaneously to achieve a more streamlined process. Although operational setup is time-consuming, it can be considerably pared down with the help of a Mexico shelter services provider.
Knowledge, Experience, Expertise, Resources
When partnering with an experienced shelter provider, manufacturers benefit from the knowledge, experience, and expertise the shelter services provider maintains by working in Mexico. Additionally, a shelter already has adequate resources and certain required permits and certifications in place, which moves the project along in a more timely manner.
Rather than waiting 7-8 months to get everything up and running, as is common with a standalone entity, the startup time for manufacturers is closer to 3-4 months when working with a shelter company.
Three areas that are noticeably expedited are site selection, labor relations, and customs compliance.
Read more: Understanding the basics of customs compliance in Mexico.
Site Availability and Inspection Requirements
It poses a challenge for U.S. manufacturers that are unfamiliar with the area to know for certain which region is best suited for their needs and what’s required to get operations started as soon as possible. Under the guidance of a Mexico shelter services company, manufacturers save on time and cost when choosing a facility location.
A shelter services company provides a list of optimal site options in Mexico based on what manufacturers deem most important for the space. Depending on the chosen location and facility, there are often specific requirements that must be met before it’s ready for production. Part of the shelter services offered are:
- Sourcing locations and scheduling site visits
- Overseeing construction (when applicable)
- Gathering permits
- Preparing for inspections
This is in addition to receiving bids from contractors, configuring IT needs, and setting up utility services under the confines of the shelter’s maquiladora. Each of these actions requires careful planning and coordination to ensure the project stays on track.
Employee Recruitment and Retention
A shelter services provider also has experience and relationships in the industry to help recruit qualified employees from a competitive Mexican labor force. In addition, shelter services include onsite and offsite training and working with the manufacturer to minimize employee turnover.
As a company starting new operations in a foreign country without this level of experience, it can take significantly more time to recruit, train, and retain qualified employees that are the best fit for the job.
Expedite Clearance at Customs
Customs compliance is critical for manufacturing in Mexico. The smallest error can result in steep fines, project delays, or could halt production completely. Customs representatives require a detailed inventory of all materials, equipment, and components that are imported and exported. By working with a skilled shelter services provider in Mexico, companies can take full advantage of NAFTA benefits and avoid the delays associated with incomplete or incorrect forms.
To compare, a company that works as a standalone entity is approximately 80% more likely to get flagged for second inspection at customs than companies who choose to work with a reputable shelter services company. Not only does this help save time, it also achieves a better sense of security for the manufacturer during the process.
Once you’ve decided to start manufacturing in Mexico, work with a shelter services provider. You will benefit from their knowledge, experience, and expertise navigating the various areas of setup required to successfully begin production. You’ll create a more streamlined, less stressful setup and minimize risk and liability for your company.