Mexico takes advantage of nearshoring to increase revenues

mexico-takes-advantage-of-nearshoring-to-increase-revenues

Nearshoring represents a growth opportunity for Latin American countries, especially in Mexico, where according to the most recent estimates, revenues of up to 35,300 million dollars could be received annually only from exports of various products abroad.

This would place Mexico in an even more privileged position thanks to its trade relations with the United States, but what exactly do we mean by this new term and what is its importance in terms of that country’s international trade?

 

What is nearshoring and how can it contribute to Mexico?

The new model is basically the practice in which a certain company decides to move its operations to other countries abroad that, despite their remoteness, usually offer the possibility of reducing operational costs such as those concerning labor to mention a simple example. Among the main objectives pursued by companies when implementing these practices is to achieve a considerable reduction in daily costs through collaboration with other service providers around the world, who in turn will benefit from commercial contracts that will mean profits much higher than those they receive locally.

It is important to note that Mexico is currently one of the countries with the best positioning in terms of nearshoring in Latin America, however, the current situation still presents notable margins for improvement that would mean a higher income for the country. The benefits or advantages for Mexico of strengthening these international practices with other countries are:

 

  • Faster shipments when establishing commercial contracts with other nearby countries such as the United States. This point is especially convenient for the neighboring country since the east is extremely economical compared to other distant nations such as China.
  • Less complexity in shipments, since, when establishing commercial relations with other nearby countries, customs requirements, as well as the risk of misfortunes in the transfer of merchandise necessary to execute the tasks decrease considerably.
  • Wide options when transporting goods given the proximity or low costs for contracting, which allows you to opt for land, sea and even air at very low prices.
  • Better communication or rapprochement between the customer and the service provider is achieved, a simply essential aspect to establish business relationships that are based on trust, accuracy, and a quick response to incidentes logísticos. 
  • This is certainly an important benefit, as the difference between communicating with a partner on the other side of the world and another who is only 2 hours away is significant.

 

Considering the progress that Mexico continues to make in international trade, the future of this model looks promising for the Latin American country, which as we have said, already enjoys a dominant position in such practices.

 

Cargo insurance as an essential aspect

Cargo insurance is a necessary complement to perceive successful results and without fear of misfortunes related to the merchandise to be transported during your nearshoring efforts.  Contact us to receive more information about which cargo insurance is fully adapted to your specific needs and the best advice from experts in the field of logistics risks. 

 

Sources:

‘’Desafíos no menores para que México se beneficie del nearshoring’’. méxicoxport

‘’Qué es el nearshoring y por qué es importante para América Latina’’. next_u

‘’ ¿Qué es nearshoring y por qué puede ser una ventaja competitiva para México en comercio exterior?’’. mundi

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