5 Reasons Why Nearshore Manufacturing Is A Perfect Fit for Mexico’s Textile and Apparel Industry

Mexico's textile and apparel industry

Mexico’s textile and apparel industry is becoming more diversified and expanding with newer investment in technology and infrastructure.  If your company is seeking full package manufacturing for garment and textile, there is no better fit than Mexico. Here are 5 reasons why:

ONE: Textile and Apparel Production is the Fourth Largest Industry in Mexico

Mexico is committed to the textile and apparel industry: According to the International Trade Administration, Mexico’s textile and apparel industry accounts for 6 percent of the country’s gross domestic product and 20 percent of all manufacturing employment in Mexico: this equates to employing almost 415,000 workers serving 22,000 apparel companies in 2013.

This growth in the number of workers and plants is demonstrating benefits to the U.S.: Textile and apparel exports to Mexico increased from $6.2 billion in 2014 to $6.5 billion in 2015, an increase of 5 percent.

TWO: Unlike China, Mexico’s Textile Workers are Specialists and are Diversifying

Because of the growth in China in the manufacturing sector, Mexico had slipped from their largest apparel supplier in 2000 to the sixth largest by the end of 2010.  However, this drop-off exposed an asset to the apparel manufacturers seeking partners in Mexico:  In the place of the ordinary textile operations that had left the area, specialized workers in Mexico’s textile and apparel industry remained, such as leather manufacturing and specialty fabrics producers for such products as Filters, air bags, covers for seats, and others that required a more skilled labor force. By 2016, U.S. specialty and industrial fabric exports to Mexico accounted for approximately 50 percent of total specialty and industrial textile exports from the U.S., representing a 1.13 percent increase over the previous year.

THREE: Mexico’s Geographic Location Makes it a Strategically Important Export Market.

Miguel Angel Andreu, a leading Mexican textile and apparel consultant, writes that the Mexican apparel and garment industry is increasingly using its low costs and proximity to the US to counter the messaging used by Chinese firms. “Manufacturers are focusing on their ability to offer flexibility and fast turnaround times, especially as US buyers appear increasingly reluctant to source high volumes of clothing from China due to the continuing uncertainty in the US market.”

FOUR:  Higher Quality Production

Most important to Mexico’s textile and apparel industry revival is its increasing focus on higher quality and a broader product portfolio. As a result of the of the skill of the maquiladoras in cutting and sewing, apparel manufacturers are benefiting from entering niche fashion markets, and a move away from high-volume production.

Mexican clothing producers are working increasingly closely with brands in the US to help meet specific requirements, and that a growing number of suppliers are offering full package manufacturing, particularly for denim, which is Mexico’s leading apparel export, and T-shirts.

FIVE: Textile and apparel sector growth has been spurred on by NAFTA

Textile and Apparel, along with automotive production, is almost certainly the most important export market for Mexico sector;  Mexico has been the key US supplier, ahead of China, Hong Kong and Taiwan.

This industry has been helped tremendously by NAFTA:  Since 1993, when the treaty went into place, textile and apparel exports to the United States skyrocketed. The increase in exports also triggered a wave of new investment in Mexico which is now at an all-time high, and many companies are wisely using to upgrade their equipment, factories and infrastructure.  Because of USMCA, Mexico industrial manufacturers enjoy low or zero-percent U.S. import duties for many products, unlike China.  The ease in which goods can be brought into the country helps keep supply chains leans, also enhancing Mexican competitiveness.

The advantages are obvious: Mexico is the best destination for a textile and apparel company seeking to have their product produced with high quality at a reduced price.  NovaLink has helped dozens of textile and apparel companies achieve success with manufacturing in Mexico;  contact us today so we can make a roadmap of success for your company.