We are an American company with strong ties between the US and Mexico. Our strength lies in identifying, developing and executing nearshoring projects of all kind for all companies in both sides of the border.
MEXshoring™ is a complete scheme for US-Mexico operations with more advantages than the current nearshoring between America and Asia.
Just let us know about your needs and through MEXshoring™ we will conduct our methodologies in order to identify the best supply source for your manufacturing chain as well as a solid base of customers. In some cases, sell/buy operations will be directly taken by IntelliHUB, thus you will deal with a direct business partner.
Nearshoring is an approach to business when a third-party company provides specific services from another geographic location, which is relatively close to the company area.
Nearshoring happens when an organization decides to transfer work to companies that are less expensive and geographically closer.
Nearshoring vs. Outsourcing.
Outsourcing is a broader term than nearshoring. Nearshoring, offshoring and onshoring are all types of outsourcing. Outsourcing is an agreement which one company hires another company to be responsible for a planned or existing activity that is or could be done internally.
Outsourcing is a practice usually undertaken by companies as a cost-cutting measure, not only money but time and resources could have a positive impact in profit when outsourcing is hired.
Nearshoring vs. Onshoring.
Offshoring is outsourcing business activities to countries with cheaper economies commercial and trade advantages. Offshoring takes advantage of cost differentials –companies using offshoring relocating their businesses activities from costly countries to cheaper ones.
Nearshoring is an excellent opportunity for your business if:
Mexico has been an attractive base for manufacturing for decades, but data indicates that more U.S.-based companies are focusing on “nearshoring” operations in Mexico than never before. Global management consultancy Kearney reports in its seventh Reshoring Index a significant trend in sourcing manufactured goods from Mexico. While imports from Mexico have risen steadily since 2009, Kearney noted a $13 billion increase in imports from Mexico to the U.S. in 2019 alone.
Kearney’s research shows that as early as 2016 more than half of U.S. companies with manufacturing operations in Mexico had moved production there from other parts of the world specifically to serve the U.S. market. “The U.S.-China trade war and the ratified U.S.-Mexico-Canada-Agreement have accelerated production flow to Mexico”. The definitive trend in the industry now is regionalization.
The McKinsey Global Institute reported in 2019 that “companies are increasingly establishing proximity to demand”. Based on research of 23 global value chains accounting 96 percent of global trade, the firm notes that the “intraregional share of global goods trade has increased by 2.7 percent points since 2013… Regionalization is most apparent in global innovations value chains, given their need to closely integrate many suppliers for just-in-time sequencing”.
It’s a shift that’s being seen across numerous manufacturing sectors, driven by upheavals to the supply chain. While some companies are weathering today’s trade disruptions, others are beginning to recognize that a more regionalized approach to manufacturing may provide long-term resilience as well as low-cost productions.
Nearshoring provides many of the cost benefits of offshoring –with labor costs being chief among those benefits- but without the logistics and geological challenges. The most apparent benefit comes though reduced shipping costs and lead times. Consider that if typically costs about $16,000 USD to ship a 40-foot container to the U.S. from China and take five weeks to arrive. To send the same shipment from Mexico would cost $4,800 USD and take days. Those shipping costs drop further for manufacturers who are able to take advantage of the minimis shipments from Mexico under Section 321 of the U.S. Code of Federal Regulations. Section 321 sets an $800 USD minimum value on shipments allowed into the U.S. duty-free.
It’s also much more cost-effective for travel to visit operations in Mexico versus other countries. This can give executives more quality oversight into complex processes. However, too many Southeast Asian Countries, Mexico has a significantly more advanced manufacturing supply chain to support sophisticated industries, from automotive to aerospace to electronics manufacturing. As a leading location for manufacturers, it has long attracted component suppliers to its various regional manufacturing hubs.