A variety of companies are turning to Nearshoring as a popular solution because of their constant need for innovation and software development skills. IT security, network engineering, computer systems analysis, and software development are nearshoring roles that are outsourced to expert engineers located nearby and who are natives of the same country. Nearshoring is becoming a preferred model for many American business executives and owners for a variety of reasons, and companies can choose to outsource technology and IT work both overseas and locally.
A nearshoring strategy to Mexico can help your business grow quickly without adding costs and complications to the process of expanding domestically. Nearshoring to Mexico is an attractive alternative to outsourcing within the country for companies, particularly those in the manufacturing sector because Mexico offers favorable business conditions. A company closes a branch in Mexico, removing all or part of its operations from the USA. Native Mexican outsourcing is very similar to traditional offshoring, in which operations are transferred to a country with a low cost of living.
Offshoring and nearshoring both offer less expensive benefits, but they also differ in how they do so. Nearshoring to Mexico is the latest trend followed by lean companies that are keeping up with current strategies. The nearshore services in Mexico entail sharing resources with a local partner to take advantage of the advantages of outsourcing and the convenience of keeping the business local. But nearshoring is more than that. Make sure you take all the factors and requirements into consideration before you jump on the bandwagon.
Benefits of nearshore services in Mexico:
- Less cost of labour: Because Mexico has a lower average cost of living, the labour cost there is lower than the United States. It is possible to hire skilled workers in Mexico for a lot less than entry-level workers in the United States. Moreover, the labour costs of China are rising. According to the International Labour Organization’s World Wage Report, wages doubled in China between the last 14 years, making it very expensive The regular entry wages in Mexico are about 60% lower than US salaries. Mexico costs more per capita to live than most of the US states. For IT, that means that for the price of one mobile app in the US, you can get three in Mexico. Furthermore, quality and effectiveness will be flawless in terms of the overall user experience when it comes to mobile apps. IT professionals in Mexico are generally cheaper than their American counterparts simply because of the difference in the standards of the two countries. Paying them less doesn’t mean that you’ll get less quality.
- Get top-quality talent: The country’s talent pool of high-skilled, cost-effective employees has been steadily improving in recent years due to high educational standards. The nation has also seen improvements in higher management wages. Further, these professionals are bilingual and familiar with the cultures of the two countries, so they can better adapt to the needs of companies in the United States. Over 60,000 IT professionals graduate annually from Mexico’s top educational institutions. More than 60,000 computer science, engineering, and technical students enroll in Mexico’s top universities each year. As a result of government incentives, the number of engineering students has increased significantly in Guadalajara and across the country. In addition, several technology initiatives have empowered tech talent at home and abroad to develop IT outsourcing solutions that are innovative and flexible.
- Less lengthy supply chain: Companies must now devise flexible supply chain solutions to overcome the Coronavirus pandemic and strict travel restrictions. Companies need to develop innovative solutions to overcome supply chain constraints. The Mexican border has largely remained open for trade between the two nations, so American companies do not need to worry about travel restrictions when nearshoring there. Moreover, a nearshoring company in Mexico is far better than offshoring to faraway nations because there is less cost of transportation and product delivery time is shorter. Nearshoring in Mexico is therefore viewed as an appealing alternative by many businesses because it allows them to schedule meetings during business hours rather than at night, plan on-site visits without traveling to Europe or Asia, and work with managers and employees who speak English.
- World-class infrastructure: If you want to set up a manufacturing unit in another country, be sure that the location has the needed amenities including electricity, water, transport, etc. A major focus of the Mexican government is building Mexico’s infrastructure to become a global manufacturing hub. Therefore, Mexico’s industrial areas have become the hub for providing businesses with the basic utilities that attract foreign direct investment. These improvements have drastically boosted the country’s manufacturing sector. It is one of the world’s top exporters of IT services, home to thousands of IT companies ranging from global giants to unknown start-ups. The nearshore services industry in Latin America is growing, and Mexico is the region’s leading market. Mexico is a safe, stable, business-friendly place to conduct business, thanks to its mature infrastructure, a stable climate, and a supportive government.
- Easy reach time: Mexico’s proximity to many U.S. airports and the many direct flights that take a few hours or less from many American points make it an important destination among travelers. Additionally, foreign tourists find Mexican flights to be less expensive and more convenient than most flights to other offshore destinations. In Mexico City and Guadalajara, which are connected by freeways, numerous businesses In Mexico City and Guadalajara, which are connected by freeways, numerous business travelers travel on day trips without overnight stays, much the same way as those traveling on the US east and west coasts. travel on day trips without overnight stays, much the same way as those traveling on the US east and west coasts.
As a result, Mexico and the United States are in the same time zone, and many regions change clocks together to daylight saving time when it’s time to do so. As your development team nearshores to Mexico, its working hours are typically the same as those of your employees in the office. Due to its low labour costs and proximity to the U.S., nearshoring to Mexico is a great alternative to other options for companies. Companies must, however, plan strategically, taking into account Mexican regulations, investment costs, and company culture.