The current impact of nearshoring on suppliers in Mexico 

Nearshoring is a trend that consists of companies moving their operations to nearby countries, instead of doing it to distant countries. Mexico is one of the most attractive countries for nearshoring, thanks to its geographical location, its skilled workforce and its low costs. 

In recent years, according to Economy Department of Mexico, Mexico has experienced significant growth in the nearshoring sector. In 2021, the nearshoring sector generated more than 1 million jobs in Mexico, and this number is expected to grow to 1.5 million jobs in 2023. 

The growth of nearshoring in Mexico is due to a number of factors, including: 

  • Geographical proximity to the United States, Mexico’s main export market.
  • Skilled labor in Mexico. 
  • Low labor costs in Mexico.
  • The world-class infrastructure in Mexico, including ports, airports and highways.
  • The favorable environment for investments in Mexico, with a low tax rate and an open trade policy.

Some of the benefits that Mexican suppliers have experienced as a result of nearshoring include: 

  • Increased Demand: Nearshoring has led to increased demand for Mexican products and services, as businesses look for suppliers who can provide them with high-quality products and services at an affordable price. 
  • Increased competitiveness: Nearshoring has forced Mexican suppliers to be more competitive, since they must offer high-quality products and services at an affordable price in order to compete with providers from other countries. 
  • New markets: Nearshoring has opened up new markets for Mexican suppliers, as companies relocating to Mexico look for local suppliers who can provide them with products and services. 

In conclusion, Nearshoring has had a positive impact on the Mexican economy, as it has created new jobs, increased exports, and generated more tax revenue but sourcing suppliers in Mexico can be challenging, but with the right approach, it can be done successfully.
In APD we strongly recommend to maintain open and regular communication with suppliers and to monitor supplier performance and quality. Finally, it’s essential to be aware of cultural differences and to be respectful of the cultural norms of Mexican suppliers. By following these steps, you can find reliable and capable suppliers in Mexico to manufacture your products. 

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