Companies with ongoing off-shore production look towards Mexico as the near-shoring alternative pushed by rising salaries in Asia, increasing fuel costs and extended supply chain risks.

 

Due to lowers costs and speed to market Mexico tops the list of options for those companies wanting to move their operations closer to home, particularly those selling to the US market, reveals a survey by The Alix Partners.

Mexico's vicinity to the North American market translates into lower inventory and freight costs, improved speed-to-market and better cultural alignment with managers. According to the opinion of those polled, Mexico is by far the number one option, ranking higher than any other country in the Americas.

Even between the enterprises contemplating off-shoring current US processes Mexico tops the list right above China with 43% of the preference, against 30% of the latter.

 

It is also clear that safety remains the number one worry among those considering Mexico as their near-shoring alternative, even when relatively few have actually had disruptions in their operations due to security risks. Furthermore, half the executives surveyed by the firm expect improvement in safety and security issues over the next five years showing that they believe these risks can be overcome by the many advantages of Mexico offshore manufacturing.

By Sergio Langarica, Co-Production International