How Shelter Services in Mexico Help When Choosing a Manufacturing Location

Mexico is a valuable location for U.S. and other foreign manufacturers ready to expand their production. With cost-effective industrial labor and a steady supply chain listed among its many benefits, it continues to gain favor as America’s number one trading partner.

As the industrial landscape continues to expand, manufacturing facilities have grown beyond the U.S./Mexico border region and into other established industrial hubs. However, there are several factors to consider when choosing which Mexico location best aligns with individual manufacturing goals.

As part of a thorough site selection process, it’s important to assess three main areas:

• Labor availability
• Logistics
• Operating costs

Labor Availability

For decades, the steady availability of cost-friendly labor has been one of the biggest allures of manufacturing in Mexico. This benefit has become even more prominent as labor availability in industrial roles largely go unfulfilled in the U.S., and at a much higher rate.

However, with a growing number of foreign operators exploring the option of Mexico manufacturing, the competition for skilled labor has been on the rise. Working with a shelter company can help manufacturers determine wages and benefits that will recruit and retain the best workers.

A shelter also has a built-in network to fulfill staffing requests in various areas to meet short hiring deadlines. And, a shelter company can adapt to a company’s growing needs and help manufacturers scale accordingly.

Logistics

In addition to industrial labor availability, the proximity to the U.S. market is one of the main reasons manufacturers choose Mexico as a foreign trade destination. Though setting up operations along the U.S./Mexico border remains the most popular region, several manufacturing hubs throughout the country are well-equipped to meet production demands as well. When considering which area is the most viable, manufacturing leaders should consider:

• Transportation connectivity
• Supply chain reliability
• Customs processes
• Competitive presence

As part of a comprehensive suite of shelter manufacturing services, a shelter company will create a site selection matrix. This matrix compares sites and provides information regarding unique logistical and facility requests to narrow down prime location options.

Operating Costs

Labor and logistics make up a large portion of total operating costs, though there are several other factors to consider when assessing where to launch production. These include:

• Industrial leases
• Utility costs (electricity, water, gas)
• Operational permits and certifications
• Manufacturing software
• Regulatory and compliance taxes
• Insurance, security, and maintenance

Manufacturers must also be prepared to hire administrative departments to launch production, such as HR and payroll, accounting and taxes, and trade compliance.

Regardless of the chosen location, U.S. and other foreign manufacturers can significantly save on costs by partnering with a shelter company. Shelter services in Mexico include all administrative responsibilities necessary to get an operation up and running quickly and efficiently, including site selection. Additionally, local expertise and experience help to protect companies from legal exposure and better position them for success.

IVEMSA can provide a site selection analysis based on your unique project goals to determine the right manufacturing location. To learn more about how shelter manufacturing services can be customized to benefit you, contact us today.