Reshoring Manufacturing

Reshoring Manufacturing

Reshoring Manufacturing is the practice of bringing manufacturing and services back to North America from overseas, primarily China or other countries in Asia (sometimes referred to as Ally shoring.) Reshoring Manufacturing is the opposite of offshoring manufacturing, which is the process of manufacturing goods overseas to try to reduce the cost of labor and manufacturing.  If you are considering getting started with Mexico industrial manufacturing, discover what NovaLink can do for you.

How Reshoring Manufacturing Works

Offshore manufacturing  has some obvious financial benefits, which includes lower labor and production costs helping them establish their operations and produce their products at a lower cost. While Reshoring Manufacturing may not give you the cost efficiencies that can be found in China, Reshoring Manufacturing can help strengthen the local economies of the country in which they are located and the economies in the countries around them.  Reshoring Manufacturing:


Why U.S. Companies Are Moving Their Supply Chains From China to Mexico

NovaLink believes manufacturing in Mexico with Mexico Supply Chain Services should be easy, fast, and cost-effective. Supply Chain Brain has a list of reasons why companies are moving their supply chains from China to Mexico.

Ground Transport

Goods can be imported from Mexico via ground transport in a matter of days or even hours. This is never an option for goods manufactured in China, from which everything must come by ocean or air. The former is very time consuming (it can often take weeks), and the latter is very expensive.

“Trusted Partner” Status for Customs

The U.S. offers two programs that help facilitate faster and easier Customs processing for U.S.-Mexico trade: FAST and C-TPAT. Initiated after 9/11, FAST is a trusted traveler/trusted shipper program that allows expedited processing for commercial carriers who have completed background checks and fulfill certain eligibility requirements (much like TSA Precheck for air travelers). FAST certification is for drivers; C-TPAT is a broader program that shippers must apply for. Once a company is certified for C-TPAT, its drivers can then apply for FAST. There are no such programs for U.S.-China trade.

A Transparent Landscape

There are also new modern options for transport that make Mexico attractive. Companies can coordinate door-to-door transportation between the U.S. and Mexico, including procurement of trucks on both sides of the border, customs clearance, insurance, financing, and reporting. This allows manufacturers to focus on their core competency, rather than logistics, and can also reduce the need for big in-house shipping and logistics teams.

Smaller Language Barrier

Spanish is the second-most common language spoken in the U.S., making it relatively easy to communicate with partners in Mexico (and find bilingual staff and vendors).

Time-zone Parity

Mexico operates on the same time zones found in the U.S. — Eastern, Central, Mountain and Pacific.

Find out More
This year, the US-Mexico Foundation (USMF), a binational non-profit committed to improving business cooperation between the United States and Mexico, initiated a new economic & trade program with the aim to have the United States work with its allies to optimize and reconfigure its supply chains so that all neighboring nations benefit from their commerce and trade.  The name of this program: Ally-shoring.

Read the Article

Reshoring Manufacturing

Why Reshoring Manufacturing?

There are many reasons for manufacturers to reevaluate their offshoring operations and consider Reshoring Manufacturing to North America. Manufacturers are recognizing that costs, risks and strategic impacts of offshoring manufacturing operations are now large enough, especially with the trade tariffs against China by the United States, to overcome any market wage advantages. According to Reshoring Initiative, the top reasons that companies  are considering Reshoring Manufacturing are:

Advantages of Manufacturing in Mexico

There are many reasons why manufacturing in Mexico is simply the better solution: Mexico shelter manufacturing services represent the best of both worlds for manufacturing companies who seek to increase quality and production while reducing costs.

Production is closer to the U.S. border; faster time to the consumer market than shipping across the Pacific Ocean, which can take weeks. Manufacturing in Mexico means lower transportation, trucks and trains as opposed to ships and the abundance of warehousing make Mexico a cost-effective solution.

The Mexican government is very friendly to foreign business and investment, as demonstrated by their 44 trade agreements with countries around the globe, including the recently-signed USMCA agreement.

Low labor costs in Mexico provide many benefits than just a lower bottom line; see how your business can profit from utilizing the low-cost labor pool in Mexico.

U.S.-made parts and products are used by Mexico Manufacturers up to four times more than China; this is a tremendous benefit to suppliers in the United States.

Do You Have a Minimum Order Quantity (MOQ)?
It is common practice in manufacturing to set a minimum order quantity (MOQ), which is the fewest amount of units that need to be purchased at once. Manufacturers or suppliers usually use MOQs for production runs, but a manufacturer can set them for different types of orders. At NovaLink, we do not establish relationships with our manufacturing partners based on MOQs, but rather through sustained production. NovaLink believes that having a consistent volume that engages full-time manufacturing teams year-round is the key to a successful, financially-viable manufacturing project. Partnering with NovaLink is not for “short runs” or products that require simple, machine-based production.


Contact Us for More Information

Explore Other Resources

Please explore these other useful resources to better understand NovaLink contract manufacturing: