Six Types of Mexico Shelter Companies

Last Updated on May 2, 2024

As a business owner looking to expand into Mexico, you're likely familiar with the term "Mexico Shelter Companies." But do you know that there are six different types of shelter companies, each with its unique benefits and advantages? In this article, we'll explore Mexico shelter companies. We'll explore what they are, how they operate, and the six distinct types that can help your business thrive in Mexico.

What are Mexico Shelter Companies?

Mexico shelter companies are entities that provide a legal and operational framework for foreign companies to establish and operate in Mexico. These companies act as a "shelter" for your business, handling administrative tasks, compliance, and logistics, allowing you to focus on your core activities. These benefits include lower labor costs, proximity to the US market, and access to skilled labor. In addition, you can minimize the risks and complexities of operating in a foreign country.

Partnering with a shelter company in Mexico brings numerous advantages to businesses, including cost savings, streamlined operations, access to specialized expertise, and risk mitigation. By utilizing the services of a shelter company, businesses can navigate the complexities of establishing and operating manufacturing operations in Mexico with greater efficiency and confidence.
Visigistics

The Six Types of Mexico Shelter Companies

Contract Manufacturing Shelter

A Contract Manufacturing Shelter is ideal for companies that want to manufacture in Mexico without setting up a legal entity. You'll partner with a local contract manufacturer, who produces your products to your specifications. This type of shelter company is appropriate for businesses that want to test the Mexican market or need temporary manufacturing capacity.

Joint Venture Shelter

A Joint Venture Shelter involves partnering with a local Mexican company to create its own legal entity. This type of shelter company is suitable for businesses that want to share risks and rewards with a local partner. This is done by leveraging their expertise and knowledge of the Mexican market.

Wholly Owned Subsidiary Shelter

A Wholly Owned Subsidiary Shelter allows you to establish a fully owned Mexican subsidiary, giving you complete control over your operations. This type of shelter company is ideal for businesses that want to integrate Mexican operations into their global strategy.

Free Trade Zone Shelter

A Free Trade Zone Shelter operates within a designated free trade zone in Mexico, offering duty-free imports and exports, as well as other tax benefits. This type of shelter company is suitable for businesses that import and export goods regularly.

IMMEX Shelter

An IMMEX shelter is a special program that allows you to temporarily import goods and materials duty-free, as long as they're re-exported or transformed into a final product. This type of shelter company is ideal for businesses that need to import goods for assembly or manufacturing. IMMEX shelters are better suited for companies that wish to manufacture in Mexico long-term and partner with a company like NovaLink.

Service-Based Shelter

A Service-Based shelter provides administrative and operational support, such as human resources, accounting, and logistics, allowing you to focus on your core business activities. This type of shelter company is suitable for businesses that want to outsource non-core functions and streamline their operations.

Mexico Manufacturing Consulting Services We Provide

NovaLink helps our clients focus on manufacturing their products. Here are just a few of the support options we offer.

Accounting

We help clients track and cut costs so they can concentrate on their core business. Get to know NovaLink Accounting.

Information Services

Integrating Information Services allows us to offer many different aspects of business technology-from inputs to support services to machines and people-so our clients can optimize production and cut costs. Find out more about NovaLink Information Services.

Human Resources

NovaLink will staff your operation to your needs. We can recruit engineering talent to oversee the nearshore manufacturing services operation on projects with a design component or those that require more technical expertise. Find out more about NovaLink’s HR services.

Six Types of Mexico Shelter Companies: Choosing the Right Fit for Your Production Goals

Mexico Shelter Companies cater to different company needs and production goals. Here's a breakdown of which types of shelter companies suit various production goals and company characteristics:

Large Volume Production

Contract Manufacturing or IMMEX Shelter: Ideal for companies with high-volume production needs, as they can leverage the Shelter Company's existing infrastructure and expertise.
Example: A US-based automotive company contracts with a Mexican shelter company to manufacture large quantities of car parts.

Small Volume Production

Service-Based Shelter: Suitable for companies with lower production volumes, as they can outsource administrative and support services without large-scale infrastructure investments.
Example: A startup electronics company uses a Service-Based Shelter to manufacture small batches of prototypes in Mexico.

Short-Term Production

Bonded Warehouse Shelter: Ideal for companies with short-term production needs, as they can store and distribute goods in Mexico without long-term commitments.
Example: A Chinese company uses a Bonded Warehouse Shelter to store electronics for a short-term marketing campaign in Mexico.

Long-Term Partnership

Joint Venture Shelter: Suitable for companies seeking extended engagements or partnerships, as they can share risks and rewards with a local Mexican partner.
Example: A German industrial equipment company forms a joint venture with a Mexican partner to manufacture and distribute products in Mexico and Latin America.

Full Control and Ownership

Wholly Owned Mexican Subsidiary: Ideal for companies that want complete control over their Mexican operations and are willing to invest in infrastructure and personnel.
Example: A Japanese electronics company establishes a wholly owned subsidiary in Mexico to manufacture TVs and home appliances.

Duty-Free Imports and Exports

Free Trade Zone (FTZ) Shelter: Suitable for companies that want to take advantage of duty-free imports and exports, reducing costs and increasing competitiveness.
Example: A US-based aerospace company sets up an FTZ shelter in Mexico to manufacture aircraft components and export them to global customers.

When choosing a shelter company, consider factors like production volume, duration, control, and partnership goals. Each type of shelter company offers its own benefits, and selecting the right one can optimize your Mexican manufacturing operations.

Our Facilities

NovaLink clients can reduce overhead costs by only paying for occupied space, labor, and shipping G&A, thanks to our unique model. Brownsville‘s distribution center has a full warehouse for clients. On a daily basis, this location moves $2 million in product to 200 locations across the U.S. and the world.

Brownsville Distribution Facility

NovaLink’s Brownsville distribution facility located at 6665 Padre Island Highway Suite B. Brownsville, Texas 78521, has 85,000 square feet of distribution space and is conveniently located only 30 minutes from the NovaLink Matamoros facility and company headquarters.

Matamoros Facility

NovaLink’s Matamoros facility located at Ave. Prolongación Calle Industrial #196 A Parque Industrial del Norte Matamoros, Tamaulipas 87316 Mexico, features 2 buildings of manufacturing space in addition to the NovaLink Headquarters. Novalink’s Mexico shelter manufacturing services are done primarily at these locations.

Nova A: 203,172 sq. ft of manufacturing space
Nova B: 201,739 sq. ft of manufacturing space.

Saltillo Facility

NovaLInk operates a 78,000 square foot manufacturing facility in Saltillo, Mexico.

Conclusion

Mexico shelter companies offer a range of benefits for businesses looking to expand into Mexico, from administrative support to tax benefits and quality control. By understanding the six types of shelter companies, you can choose the best fit for your business needs and thrive in the Mexican market.

FAQs

1. What is the main advantage of using a Mexico Shelter Company?

The main advantage of using a Mexico shelter company is that it allows you to focus on your core business activities while minimizing the risks and complexities of operating in a foreign country.

2. Which type of Mexico shelter company is best for businesses that want to test the Mexican market?

A Contract Manufacturing Shelter is ideal for businesses that want to test the Mexican market or need temporary manufacturing capacity.

3. What is the main benefit of a Free Trade Zone Shelter?

The main benefit of a Free Trade Zone Shelter is that it offers duty-free imports and exports, as well as other tax benefits.

4. What is the main advantage of an IMMEX Shelter?

The main advantage of an IMMEX Shelter is that it allows you to temporarily import goods and materials duty-free, as long as they're re-exported or transformed into a final product.

5. How can a Service-Based Shelter benefit my business?

A Service-Based Shelter can benefit your business by providing administrative and operational support, allowing you to focus on your core activities and streamline your operations.

About NovaLink

As a manufacturer in Mexico, NovaLink employs a unique approach that transcends the traditional model of shelter production. More than just the location of your manufacturing, we would like to become a partner in your manufacturing in Mexico. You will be able to relocate or initiate manufacturing for your company in Mexico in a low-cost labor environment with very little delay or up-front costs. Find out how we can help you by handling the manufacturing process.

There are NovaLink facilities in the border cities of Brownsville, Texas, Matamoros, Mexico, and Saltillo, Mexico.

Contact NovaLink Today

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