6 Key Factors When Choosing an Industrial Property in Mexico

Manufacturing in Mexico offers a lot of benefits. It can let you save a lot in terms of cost while having access to a reliable and strong workforce. On top of that Mexico also has Free Trade Agreements with many countries, and a diverse range of existing industry clusters.

If you’re want to take advantage of its benefits and start manufacturing in Mexico, the first thing that you need to do is choose an industrial property. That decision is more important than you may realize, and it can have a huge impact on the future of your business.

To make sure you choose the right industrial property in Mexico, there are several factors that you should consider:

1. Proximity to customer base

Choosing a location that is close to your customer base can be very helpful, and save both transportation time and cost. If your customer base is mainly in the United States you may want to focus on areas that are close to the border, whereas if it is international then proximity to airports or seaports may be more important.

2. Buy vs. lease

Typically you can choose to either buy or lease industrial properties in Mexico, and both approaches have advantages as well as disadvantages.

To decide which option fits, you should look at its impact on your cash flow, and the requirements you have for your industrial facility. Be sure to also consider what happens if your company eventually wants to leave Mexico and move its manufacturing elsewhere.

3. Availability of property

Some regions of Mexico have a wide range of industrial property available, including modern buildings as well as vacant land. On the other hand some areas have very limited land for development, which can make finding a property difficult.

In general it is best to focus on areas where there is no shortage of property as the cost will be lower and it will be easier. However sometimes the fact that there is a lot of property available may be a sign that there are other factors at play.

4. Labor force skills

As you can imagine, the availability of skilled labor will be extremely important if you want to set up shop in Mexico. Because of that you may want to consider looking for an industrial property in areas where similar industries are already present.

Typically such areas may already have adequate educational and training support in the form of technical schools, universities, or other training facilities. Additionally they are likely to have a larger skilled labor force.

5. Incentives

The Mexican federal and state governments are known for offering various incentives to attract manufacturing companies. While you shouldn’t base your decision solely on the incentives that are offered, it would be a good idea to look around for the best deal on land, tax exemptions, workforce training, and so on.

6. Local suppliers

Existing industry clusters often have numerous local suppliers, which can make your operations easier. By checking out the market you can find out what products and services are already available, as well as local vendors that you can use for packaging, transportation, and so on.

If you weigh all of these factors, you should be able to narrow down your options and find a suitable industrial property in Mexico more easily. As you can see each factor can have a big impact on your business and its ability to establish manufacturing facilities in the country.

By carefully researching the industrial real estate in Mexico, you should be able to choose one that lets your company enjoy the many advantages of manufacturing in Mexico.