Mexico

Why Are Companies Moving Manufacturing out of China?

NovaAdmin · April 18, 2022 ·

Manufacturing is a major industry in China, as we know. A third of supply chain leaders plan to move manufacturing out of China by 2023, according to Gartner research. Here’s why so many companies are moving out:

Companies learned from the recent Covid-19 pandemic that they cannot rely on just one supplier. Meanwhile, governments across the globe are trying to get companies out of China. Many companies are considering Mexico as a potential location.

In 2018, the United States imposed tariffs of 25% on Chinese goods. Importing goods from China into the US was therefore very expensive.

Three or four decades ago, Chinese labor was one of the cheapest in the world. In recent years, it has greatly increased to $14000/year, which is a huge increase. Manufacturing in China has become more expensive.

What Are The Immex Program Requirements?

NovaAdmin · February 21, 2022 ·

The companies eligible to benefit from the IMMEX program must export finished products worth at least US $500,000. Their export revenues must also account for at least 10% of their annual sales.

What is the IMMEX Program?

NovaAdmin · September 8, 2021 ·

The IMMEX program is a manufacturing solution created in the 1960’s to utilize preferential tariff agreements between the U.S. and Mexico & to encourage foreign investment in that country. The IMMEX program is an acronym in Spanish for “Manufacturing, Maquila and Export Services Industries Program” (Industría Manufacturera Maquiladora y de Servicio de Exportación).

More commonly, the IMMEX program is known by their traditional name “Maquiladora”.

What are some common mistakes companies are making in Manufacturing in Mexico?

NovaAdmin · July 11, 2018 ·

For starters, assuming they know enough about Mexico to dive in and do it alone. Secondly, committing to an overhead structure that they must grow into rather than starting with a partner that allows them to grow into their needs.

With NovaLink, it is up to the client. We welcome expat involvement and work diligently to make them feel a part of the Mexican, NovaLink family. However, there is no need to commit long, term resources to the Mexican operation. Teach us and then we will run with it and manage the operation for our new partnership.

Do I need to understand Spanish or have someone in my organization that does to Manufacture in Mexico?

NovaAdmin · July 11, 2018 ·

It never hurts, but, no. NovaLink has a bilingual staff at the management levels that will be dealing with your personnel. Aside from this, at the corporate level, the executive management and many of the upper management are fully bilingual.