The increasing cost of labor in the United States over the last few years has driven many manufacturing companies to seek setting up shop elsewhere. This, however, can be tricky, as local laws and regulations in some foreign countries are sometimes plagued with lots of fine print. Also, the cost of setting up a manufacturing operation may prove far more expensive and complex than expected. Yet, the final outcome makes it a very attractive option, as there are numerous companies offering shelter services out there.
One of the most sought after countries for offshore operations is Mexico. Not only for its closeness to the United States, but also because there is a long list of successful businesses that have held operations in this country for years. Shelter companies have existed in Mexico at least for the last 60 years or so.
Shelter companies allow foreign manufacturers to start operations in Mexico without the hassle of registering with the Mexican government, as the shelter company will find the appropriate facilities, round up the required equipment according to the manufacturer’s field of production, and obtain the necessary licenses and permits. They will also register as an imports/exports company, so that manufacturers may bring in their own raw materials for production, thus maintaining quality standards at their best, and then export the finished products.
For a manufacturer to start a new company from scratch on their own, it could mean months, if not years, of complicated processes that involve finding and hiring law and accounting firms to deal with the paperwork. The shelter company, on the other hand, is already established and much of the necessary foundation for a new company is already there. Also, the shelter company will already have the necessary connections with customs brokers and transport services. All the manufacturer needs to do is make sure their equipment and machinery is ready to cross the border to start operations in Mexico.
But, perhaps one of the most important benefits of hiring a shelter company is human resources. The shelter company will interview, evaluate and hire the right personnel for any given operation. This also includes dealing with unions and other requirements in order to comply with current labor laws. Some shelter companies go even further and offer payroll and human resources management as an outsourced service.
If your company is considering to start an offshore operation in Mexico, please give us a call. We will gladly show you the most profitable way to achieve it.
