How Shelter Companies Simplify Manufacturing in Mexico
How do Shelter Companies Simplify Manufacturing in Mexico? It is quickly becoming apparent that Mexico provides vast opportunity to businesses and investors around the world, yet the misconception that partnering with the Latin American country is too complex persists.
Land of Opportunity
Mexico is swiftly becoming a partner of choice for producing goods for export. The country boasts a highly skilled workforce with labor costs on par with China. Additionally, Mexico has over 40 free-trade agreements signed with vibrant consumer economies all over the world, most notable of which is the United States just over the border.
Over the past several years, this quest to modernize and attract foreign direct investment has accelerated under the administration of Enrique Peña Nieto. Since taking office in 2012, President Nieto has advanced numerous reforms and overhauls aimed at strengthening infrastructure and protections for intellectual property in the interest of attracting new business. The legislative regime has been improved, transportation is being addressed, energy reform has been sweeping, and tariffs are being lowered and dropped.
But what about the complexities of moving operations to an entirely different country?
Simplifying with Shelter Companies
Because of the genius of shelter companies, the complexities of establishing a business operation in Mexico are about the same as moving across town. These strategic partners provide outsourced manufacturing support services to simplify the transition and facilitate the establishment and maintenance of ongoing production facilities in the Mexican maquiladora system. Rather than handling the heavy lifting, themselves – acclimating to a different workforce, tax structure, culture, supply chain, etc. – companies looking to invest in Mexico can partner with shelter companies to handle these aspects for them. This allows those companies to focus solely on their core manufacturing functions and product quality goals.
With shelter companies, the risks of manufacturing in Mexico are minimized, since clients partnering with them have no direct dealings with regulatory and tax agencies. Payroll, hiring, facility construction, and on-site management are competently managed by a shelter partner that is already entrenched and well-versed in the local economy. Typically, shelter companies offer a myriad of benefits, including among others:
- Fast Mexico manufacturing startup
- Experienced Mexican labor recruiting
- No Mexican government reporting
- Reduced border crossing costs and delays
- Effective labor union relations and negotiating
- Ensured market wages and benefits
- No responsibility for Mexico income tax
- Compliance assurance for Mexican Customs
- Access to trusted Mexican vendors and service providers