Ask Us Anything: Answers to Your Questions About Manufacturing in Mexico

Last Updated on June 14, 2023

Manufacturing in Mexico has become a popular choice for businesses seeking cost-effective production and access to global markets. With its strategic location, skilled workforce, and favorable trade agreements, Mexico offers numerous advantages for companies across various industries. In this article, we will provide answers to common questions about manufacturing in Mexico, addressing topics such as benefits, industries, challenges, success stories, and future opportunities.

1. Why is manufacturing in Mexico beneficial?
   Manufacturing in Mexico offers several benefits. Firstly, labor costs in Mexico are lower compared to developed countries, enabling businesses to optimize production costs and increase profitability. Secondly, Mexico's proximity to the United States provides easy access to the largest consumer market in the world, reducing transportation costs and lead times. Lastly, Mexico has favorable trade agreements with multiple countries, facilitating seamless trade and eliminating trade barriers for businesses operating in the region.
2. Why should I manufacture my product in Mexico?
   One of the most asked questions about manufacturing in Mexico; Actually, there are multiple reasons. Available labor pool that is trainable and ready to make a career out of manufacturing.
   A close proximity to the market. By using Nearshore Manufacturing Services, you can save time and money. It has become more convenient for you to plan for a shorter period of time rather than months in advance. Due to the fact that you are ordering weeks rather than months in advance, you are holding fewer finished items in stock. A reduction in inventory commitment is also achieved. With raw materials, you are more flexible in terms of what you can convert them into.
3. What are the key industries for manufacturing in Mexico?
   Mexico has a diverse range of manufacturing industries. Some of the key sectors include automotive manufacturing, aerospace industry, electronics manufacturing, and medical device manufacturing. These industries have experienced significant growth and success in Mexico, attracting both domestic and international companies.
4. What are the steps to establish a manufacturing operation in Mexico?Establishing a manufacturing operation in Mexico requires careful planning. Key steps include understanding the legal and regulatory environment, choosing the right location based on logistics and infrastructure, setting up necessary infrastructure and logistics networks, and hiring and training a skilled workforce. These steps contribute to the smooth establishment and operation of a manufacturing facility in Mexico.
5. How long does it take to get my product setup and manufacturing running?
   Typically set up under our model is quick; within a month. This is dependent on many variables such as lead time on equipment, if it is to a be a component sub-assembly project, getting raw materials to be used, etc. Since NovaLink is the incorporated business in Mexico and holds current maquiladora permits, the time constraint is not on the legal side of setting up. Then of course you have the set up of equipment time and the process of training the operators in the processes.
6. How much do I need to understand about manufacturing?
   It is preferential that you have an understanding of your manufacturing so that you can be a part of the success of the program. It is your product that we would be manufacturing so it is important that we make them to your satisfaction. It is also beneficial when the client has involvement in the manufacturing process set up and approval. However, if that is not available, NovaLink engineers can often times step in and engineer the process and necessary equipment.
7. Are there any success stories of manufacturing in Mexico?
   Yes, there are numerous success stories of manufacturing in Mexico. For example, leading automotive manufacturers have streamlined production processes and reduced costs significantly by leveraging Mexico's skilled workforce and favorable business conditions. Electronics manufacturing companies have also expanded their operations in Mexico, taking advantage of the country's strategic location and well-developed supplier networks.
8. Do small or big companies do better in Mexico?
   Both have succeeded extremely well and failed just the same. Size does not matter! It is how you do it. Who you partner with and what you know. It usually boils down to partner with the right company and people. Those that will learn your business and truly become your partner. You fail, they fail!
9. What are the future opportunities in Mexican manufacturing?
   The future outlook for manufacturing in Mexico is promising. Advancements in technology and automation are expected to drive increased efficiency and productivity in the sector. Mexico's commitment to sustainable manufacturing practices presents opportunities for companies to adopt environmentally friendly processes and meet evolving consumer demands. Additionally, Mexico is investing in research and development (R&D) and fostering innovation in the manufacturing sector.
10. Who are The Maquiladoras in Mexico?
    The term "maquiladora" refers to manufacturing operations in Mexico that engage in the assembly, processing, or production of goods, primarily for export purposes. These operations typically involve foreign-owned companies, known as "maquiladora companies," that take advantage of Mexico's favorable business environment and cost-effective labor force. The legal name of maquiladora is "IMMEX".
11. How can companies navigate the legal and regulatory environment in Mexico?
    Navigating the legal and regulatory environment in Mexico requires a thorough understanding of the country's laws and regulations. Seeking legal counsel and partnering with experienced professionals can help businesses comply with legal requirements and ensure smooth operations.
12. What are the key considerations for supply chain management in Mexico?Efficient supply chain management is crucial for successful manufacturing in Mexico. Companies should focus on developing robust supply chain networks, collaborating closely with suppliers, and implementing effective inventory management strategies. This helps mitigate potential disruptions and ensures a smooth flow of materials and components.
13. How does Mexico protect intellectual property for manufacturers?Intellectual property protection is a concern for many manufacturers. Mexico has made significant progress in strengthening its intellectual property laws and enforcement mechanisms. Registering trademarks, patents, and copyrights in Mexico provides legal protection, and companies can seek legal remedies if their intellectual property rights are infringed upon.
14. Is manufacturing in Mexico safe and secure?
    Security and safety concerns are important considerations for manufacturers in Mexico. Companies should implement robust security measures to protect their assets, employees, and intellectual property. Collaborating with reputable security firms and staying updated on local security conditions can help mitigate risks and ensure a safe working environment.