The New Mercenaries – Outsourcing

13 10 2006

Mercenary, as defined by the American Heritage Dictionary: Motivated solely by a desire for monetary or material gain. One who serves or works merely for monetary gain; a hireling.”

Using this definition, and forgetting the military connotations of the word (warrior for hire). The term mercenaries can be used to describe outsourcing suppliers and organizations.

Our outsourcing mercenaries are individuals or organizations that are motivated solely by monetary gain and do not share our organizations philosophies, ideals and interests.

We are hiring mercenaries to manufacture our goods, “do the dirty work”, buy time and help us compete better (and win) against the competition.

Are we weighing the long term risks of this outsourcing strategy?

Beyond the current short term cost benefits, have we identified the long-term strategic and control risks to our organizations by embracing outsourcing?

There are inherent dangers and advantages to using mercenaries. What can history tell us of mercenaries and the long term results of depending upon them?

Niccolò Machiavelli in The Prince (a book about the strategy of power and control), wrote that mercenaries were not loyal, dangerous and even useless: “He who holds his State by means of mercenary troops can never be solidly or securely seated. For such troops are disunited, ambitious, insubordinate, treacherous, insolent among friends, cowardly before foes, and without fear of God or faith with man. Whenever they are attacked defeat follows; so that in peace you are plundered by them, in war by your enemies. And this because they have no tie or motive to keep them in the field beyond their paltry pay.”

The decline of the Roman Empire has been linked to the use and dependence upon mercenaries. The failure to control them, and their infiltration into positions of command and control inside the government.

Mercenaries

  • Historically tend to overthrow the power or control they do not like.
  • Adopt strategies to protect themselves from danger and risk.
  • If talented, will seek to increase their power, and if incompetent will ruin their employer.
  • Have no loyalty to the employers ideals, goals or objectives.
  • Are marked by their materialism.
  • Create their own agendas and goals
  • Their first priority is to themselves and self preservation.

Using (outsourcing) mercenaries can be positive when:

  • There is total control and agreement regarding training, quality, standards, and continual improvement.
  • The competition has access to equal or reduced resources in order to hire mercenaries.
  • There are clear short term objectives and goals, at which point the contract is finished and/or renegotiated.
  • There is clear recognition that their intervention is specialized, unique and required to create an advantage for swift campaigns or to solve specific problems.

Mercenaries and outsourcing become a risk or hazard to your organization when:

  • Mercenaries reach a level of importance and power, where their absence will provoke or contribute directly to your failure.
  • They understand your entire process or have access to your “secrets”.
  • When the competition can pay more for their services than you can.
  • Objectives are not clear, and contracts are not specific.
  • Quality standards fall, or the organization accepts below standard levels of work or products.
  • Mercenaries are relied upon to provide long term stability or to reach long term goals for your organization.
  • You forget that mercenaries respond to power and money, and not on providing quality “soldiering”.
  • You believe that by hiring mercenaries you have eliminated risk from your operations.

What risk factors and changes occur in our organization when we relinquish control over the entire process by using outsourcing mercenaries?

What happens when our outsourcing “partner” says no or begins to work for the competion?

Are we outsourcing because everyone else is, or are there fundamental long term strategic and economic reasons that support the decision?

Related Links

The Dangers of Outsourcing and What You Can Do About It

Reining in Outsourcing Risk





Changes – dialing long distance to a cellular phone in Mexico

12 10 2006

New changes take effect for some cellular phone companies in Mexico on November 4, 2006.

The program is called “El Que Llama Paga Nacional”, which loosely translated means “Whoever Calls, Pays for the Call In Mexico”. Previously a long distance call to a cellular phone was shared between the caller and the receiver of the call.

New long distance dialing codes (after November 4, 2006) from “regular” landline phone to a cellular phone:

If calling from Mexico, long distance to a Mexican cell phone:
045-Area Code – Telephone number
(the old code was 01-Area Code-Telephone number)

If calling from other countries to a Mexican cell phone: 52-1-Area Code- Telephone number (old code was 52-Area Code- Telephone number)

This 045 prefix applies to calls to cellular phones using Telmex, Telefonos del Noroeste, Telcel, Iusacell, Iusatel, Telefonica, Baja Celular, Telefonia Celular del Norte, Portatel del Sureste, Telecomunicaciones del Golfo and Unefon service. This represents 90% of the cellular phone users in Mexico.

The person on the cellular phone receiving the call will not be charged, however the person making the call from the landline phone will be charged approximately $ 3.00 Mexican pesos per minute (an increase of 300% from the current rate). The rates are still being negotiated between the companies and final results should be available from Cofetel in the next week.

The following companies have not signed the agreement: Axtel, Avantel, Alestra and Maxcom. Dialing to cellular phones using these suppliers will remain the same (01-Area Code- Telephone number) and the costs are shared between the person dialing and the person receiving the call.

Related Links

Cofetel

El Que Llama Paga Nacional (pdf)

How to call Mexico from the USA





Global competitiveness 2006 – Mexico and China

11 10 2006

The Global Competitiveness Report 2006 – 2007 (Link), released by the World Economic Forum on September 26, 2006 has some statistics and rankings of interest if your organization is expanding into new international markets.

Based upon a mix of economic factors, information and the opinions of international business leaders, the report lists how competitive nations are in relation to one another, and compares this to last years ranking.

Mexico has clicked up a notch from 59 in 2005 to 58 in 2006.

  • Mexico’s ranking has remained broadly stable, moving up one place to 58. The country’s somewhat uneven performance over the various pillars of the GCI is shown by relatively high scores for health and primary education, goods’ market efficiency and selected components of technological readiness, e.g., FDI and technology transfer, no doubt reflecting the close links of the Mexican market to the US in the context of NAFTA. However, this is offset by the same institutional weaknesses as are prevalent in the rest of Latin America.”

China is the big surprise, dropping 6 points this year (48 in 2005, 54 in 2006).

  • “On the positive side, China’s buoyant growth rates coupled with low inflation, one of the highest savings rates in the world and manageable levels of public debt have boosted China’s ranking on the macroeconomy pillar of the GCI to 6th place – an excellent result. However, a number of structural weaknesses need to be addressed, including in the largely state-controlled banking sector. Levels of financial intermediation are low and the state has had to intervene from time to time to mitigate the adverse effects of a large, non-performing loan portfolio. China has low penetration rates for the latest technologies (mobile telephones, Internet, personal computers), and secondary and tertiary school enrollment rates are still low by international standards. By far the most worrisome development is a marked drop in the quality of the institutional environment, as witnessed by the steep fall in rankings from 60 to 80 in 2006, with poor results across all 15 institutional indicators, and spanning both public and private institutions.”

Related Links

World Economic Forum

Institute for Strategy and Competitiveness

U.S. tops world competitiveness index 2006





What can we learn from the piracy business model

10 10 2006

Here is a interesting way to view, prepare for and compete against businesses copying and pirating your content or products.

Piracy is a business model. Anne Sweeney, co-chair of Disney Media Networks and president of Disney-ABC Television Group, announced during a keynote address at MIPCOM. While her focus was on the pirating of media content, the same message applies for manufactured goods.

“It exists to serve a need in the market….. Pirates compete the same way we do – through quality, price and availability. We don’t like the model but we realize it’s competitive enough to make it a major competitor going forward.

What’s so amazing about this?

Taking the piracy is a business model approach allows us to analyze the business model and how it is acting or reacting to the economic fundamentals in the market.

Instead of locking up our company secrets and seeking punishments for the pirates, we can analyze why and where our “competition” is taking advantage of us in order to strengthen and modify our business model.

None of this changes the actual situation. But it might change business strategies and planning when you realize they are competitors and they are here to stay.

What are the advantages of being a pirate, and the disadvantages?

Why are there opportunities for them? What should I be doing that I’m not?

How can I change my organization to take back the market from the pirates?

Once weaknesses in the piracy business model are identified they can be exploited. When strengths are discovered, they can be integrated into our own business model.

The fight against piracy should begin with a focused analysis of the market environment, existing business models and new strategies on how to adapt to the changing market conditions and exploit them to your advantage.

We can stop focusing on the individual “pirates” and their control or capture, and move toward competing intelligently against them.

Related Links

The easy way

The power of something extra

Netribution – Disney Co-Chair recognizes ‘piracy is a business model’

Boing Boing – Disney exec: Piracy is just a business model

@MIPCOM Piracy is a business model


 





Lessons in international business

10 10 2006

The most difficult part of doing business overseas will occur when you have to explain your country’s politics and culture, and provide answers on why you do things the way you do.

Related Links

Cultural misunderstanding it can happen to you

Stereotypes and global business

International business traveller, ambassador, explorer, map-maker





The easy way

9 10 2006

Despite all the attention on the power of marketing in order to create and maintain a successful product and business, there are still many organizations and people who don’t want to, or don’t know how to market their products.

They want others to buy their product because they are less expensive than the competition.

It’s the easiest way to sell, requires no planning, no marketing, no effort on the part of the salespeople or the organization. Quick short term results.

Everyone is in the market with the same goods, all screaming and shouting for the customers attention. The customer finds the seller by accident or luck, and proceeds to bargain and negotiate for the lowest price in the market. Very colorful.

It shows a lack of responsibility, lack of marketing, and lack of imagination on the part of the seller.

The owners say: “We need more profit, cut costs and sell more”.

The sales managers say: “We can sell more, but the product is a commodity, what can we do, cut the costs and we can corner the market”.

Production says: “We’ll cut costs, get cheaper raw materials and tweak the design”.

Buyers tell suppliers: “We can try your raw materials or products and see if the market accepts that price, but you have to give me a better price if you want me to buy more”.

Salespeople tell the sales manager: “I don’t know if I can meet that sales quota, it’s not up to me, it’s up to the market to decide”.

Salespeople tell the customer: “We’re cheaper than the competition, buy now”.

The competition is doing the same thing you are.

The customer faced with similar products and lack of information says: “Give me the one that costs less”.

Where was the marketer during all this?

What should they have been doing and saying to the organization and the customer?

If your product isn’t distinct, different or better than the competition. If you are not educating your customer about the advantages of your products and services. You will never have to the chance to market your products.

You will only be able to offer them for sale.

Related Links

Seth’s Blog: Cheaper

The power of something extra

Sales and marketing terrorism





How to motivate yourself on Monday

2 10 2006

Here we go again, Monday morning, back to work. Need some ideas on how to get pumped up for the week ahead?

1. The survivor approach. Challenge yourself to attack the most difficult work problems first thing today. Admit that it has to be done and might be the most uncomfortable or unpleasant activity you will encounter during the week. Once this is out of the way you’ll be surprised how much easier the rest of the week will be.

2. Send out positive energy. Be cheerful, upbeat and responsive to customers and coworkers. Say hello to everyone, acknowledge their presence. If you encounter grumpy, sad or depressed individuals smile at them and move on. Leave everyone you meet with the impression that you’re happy, full of enthusiasm and motivated today. Sound completely out of character for you? Good.

3. Monday is list execution day. List makers should prepare their weekly to-do lists on Friday afternoon or Sunday evening. When you walk into the office on Monday the plan is waiting for you to dig in and execute it.

4. You are working for you. Remember that you are working in order to achieve your personal goals. The work is part of that process. You are not working for XYZ corporation, you truly are working for yourself. It’s your decision to stay or to leave the company, your future is in your hands. Try that attitude on and see what happens.

5. Make someone proud of you. Everyone has a person or persons in their lives that they love and respect. Who are these people in your life? What could you do today at work to make them proud of you? Do it.

6. Act like an invincible leader. Feeling miserable and trying to spread that misery, gloom, doom and depression to others is a pretty pathetic way to live. Do you like to be around people with this attitude? Why would others want to be around you if you are a walking “cloud of misery and darkness”? You are a victim if you agree to be one.

7. Give yourself prizes. Set some work goals and create rewards for their completion that can be enjoyed on the weekend.

8. Motivation through memories. On the way to work think about the times in your life when you were the most enthusiastic, excited, motivated and happy. Remember the way you felt, identify why you felt so good, relive those experiences.

9. Go to work with a specific mission and deadlines. Make specific commitments for goal completion to others.

10. Decide to take a vacation. Burned out, stressed out, unable to focus, unable to get excited? Take time off, disconnect from work (that means no email, no telephone calls). Recharge your batteries. Figure out when you are going, for how long, with who and where.

11. Let cosmic forces and your subconscious decide. Sit down in a quiet spot, turn off the cellular phone, lock the door and try to clear your mind. In a matter of minutes you will begin to be bombarded with ideas or things you should be doing, and their priorities. Open your eyes, and get started.

12.  Music.  You know the tunes that start your feet tapping or set your soul soaring.  Record them, put them in your I-pod, burn a disk for the car.

13.  Change.  Setting a routine is quite normal, and comforting, but not motivating.  Change something.  Maybe it’s breakfast, the way to work, your clothes…who knows.  Fiddle around with your patterns and routines.

14.  Altruism.  Do something for someone else, without seeking anything in return.  Random acts of kindness.

R elated Links

Showtime – how do you want to live your life

Motivation, what gets you out of bed

10 things you should do on a Friday afternoon





20 ideas – how to avoid major problems with your export business

29 09 2006

Exporting is an extremely difficult process as compared to selling in the local or national market. Exporting is not easy, and it’s not inexpensive. It takes planning and requires people that are open, flexible, problem-solvers, and quick at adapting to new situations.

A smart organization that desires to export their products will invest time and money building the proper administrative and sales structure before they begin operations.

20 ideas – how to avoid major problems with your export business

1. Say no to customers. When you can’t do it, say no upfront, before you make an agreement.

2. Create an export strategy before you begin to export. Don’t get sucked into exporting by “accident”.

3. Samples should be equal in quality to the actual production that will be shipped.

4. Make everything perfectly clear with customers. Don’t assume anything, don’t work with suppositions.

5. Learn and understand the business culture of your export market and customers before you begin.

6. Provide detailed price lists and price quotations to the customer. Understand your Incoterms (if you don’t know what these are, stop know and click here)

7. Contemplate what problems might possibly arise (internal and external) that could affect shipment or delivery. Prepare alternatives or take preventive action.

8. Understand that there is a learning curve that affects the organizations ability and performance when exporting to new markets. Calculate the time this will require, and it’s cost.

9. Write down and sign all agreements with the customer (dates, specifications, changes, time, everything). Verify everything with an email or fax if unable to physically sign the agreements and changes.

10. Use caution about exclusivity agreements. Everyone wants exclusivity, will that exclusivity support your entire export production? Will it limit your ability to grow?

11. Develop a quality control system throughout the company.

12. Never send poor quality products, especially in order to meet a shipping deadline.

13. Research the transportation, temperature and climatic conditions that the product will be subject to prior to arrival at the export destination.

14. Create an export price strategy. Know where you are going, and how you want to get there, your costs and required profit margins before you begin to quote prices.

15. Clearly define the costs of production and separate them from the costs of the sales required for exports. Give the sales department a base price to build upon, and make sure they clearly identify the costs related to sales and promotion in the export markets.

16. Always have at least 2 customers in the export market. This will provide protection and stability for your production and for the customers in the export market.

17. Customers who provide the research, development and design for the product may bring samples to you. Assist in the development and manufacture of the samples. Your production know-how (turning ideas into product) is fundamental and important for all involved.

18. Research and investigate fashion, trends and tendencies. In order to survive, you have to create, not pirate and copy.

19. Quality complaints and suggestions must be addressed and implemented immediately. This has to be part of the understanding of every worker, from production to sales to executive suite.

20. Discipline, planning and order. Production planning, raw material purchasing decisions, financing, infrastructure investment, human resources, sales and marketing all must be planned and coordinated, at all times.

Added Oct. 1, 2006 – Bonus legal reminder:  Know the law of the country to which you are exporting concerning:  retention of documents for litigation, product quality and manufacturing and product safety before you begin sales and shipping.  Understand your responsibility and liability for recalls, retrofitting, refunds or destruction of the product.  Learn about your legal responsibility and relationship with brokers, agents and distributors and your products.

Related Links

7 tips for doing business internationally

Maquila and Maquiladoras in Mexico

Why you should pay attention to free trade treaties

Mexico and international free trade treaties





Maquiladoras in Mexico

28 09 2006

An Internet search for the definition of the terms maquila and maquiladora will turn up quite a variety of ideas and interpretations.

The maquiladoras have created quite an emotional and political reaction on both sides of the US and Mexico border. They have been accused of stealing jobs from the US, promoting sub-standard working conditions, lowering wages, exploiting workers, and not contributing to the Mexican economy.

Despite the controversy, the maquiladoras are growing and thriving in Mexico. They offer attractive benefits to organizations that are seeking competitive production and assembly costs, skilled labor and Mexico’s proximity to the US market. Recently many transnational organizations that moved manufacturing operations to China in the 1990’s have moved back to Mexico due to cost and logistic advantages.

Maquila and Maquiladoras – definitions and activities

  • The term maquila comes from the Spanish term that refers to the portion paid (in grain, flour or oil) to a miller for milling a farmer’s grain.
  • Maquiladoras are legal entities under Mexican law, with special tax privileges, they provide service, assembly or manufacturing operations.
  • Maquiladoras are able to import raw materials or semi-processed materials from foreign countries, in order to service, process or assemble them in Mexico, and then export the finished product back to that country. These activities take place without the collection or payment of import, export or V.A.T. (value added tax) taxes.
  • The maquiladora program was created by Mexico in order for foreign organizations to take advantage of low labor costs in Mexico (primarily the USA), and to provide employment to Mexican workers in Mexico. Initially the maquila operations were located close to the US border. Currently maquila operations can be found throughout Mexico.
  • Maquiladoras can be 100% foreign owned, 100% Mexican owned, or a joint venture between Mexican nationals and foreign investors.
  • Maquiladoras are also known as twin plants, in-bond industries, export assembly plants and offshoring.
  • The maquiladoras in Mexico suffered from a crisis of plant closings in the 1990’s and early 2000’s as many companies moved operations to China. Since 2004, Mexico has seen a resurgence of the maquiladoras.

  • Check with your attorneys and accountants in Mexico about the specific benefits of the maquila program. As of September 2006, there were important legal changes (simplification and consolidation of government compliance and monitoring programs) that will affect current and future maquiladoras.

Related Links

Why you should pay attention to free trade treaties

Industrial and business parks in Mexico


Official government websites of the 32 Mexican states

Maquila and Maquiladoras in Mexico





Business South of the Border

28 09 2006

I’ve found two seperate and distinct themes running through this blog.  Business leadership and management ideas and advice on how to do business in Mexico and internationally.

I will continue to post all my writing on these topics here.

For those interested only in my information related to Mexico, how to do business in Mexico plus related links and references about Mexico.  I invite you to visit the new repository of all things about Mexico:  Business South of the Border (Link).

Related Links 

Business South of the Border

Lee Iwan





Why you should pay attention to free trade treaties

27 09 2006

Globalization, transnational companies, global sourcing and outsourcing, free trade, do any of these terms sound familiar?

Obtaining products and raw materials for the lowest price possible is a fundamental concept in business. Today organizations are looking for manufacturers and locations worldwide where they can find lower costs of production in order to remain competitive.

Combine the factors of: quality control, low cost production, logistics costs, and the time involved to get the product to market from the factory, and you understand the challenge of doing business and sourcing products in today’s global economy.

To truly determine the final cost of the product, all these factors must be calculated. This will determine which country offers the best competitive advantage. Make sure you are analyzing any existing free trade agreements when you are seeking suppliers globally.

Free trade treaties between countries have a significant impact upon the final cost of goods. These free trade agreements eliminate the tariffs and taxes on imported and exported goods between the countries involved, depending upon their concentration or percentage of “local” or national raw materials (including labor), as specified in the free trade agreement.

Free trade agreements between countries are of great importance and value only if are exclusive and not accepted by all trading countries. The more free trade is embraced by the international community (through treaties or elimination of import and export tariffs) the less impact the current free trade agreements have in determining competitive advantages for a single country.

Here is a simple example of how the NAFTA (North American Free Trade Agreement) free trade treaty between Mexico and the USA, would favor the US supplier over a Chinese supplier.

Example of free trade agreeement competitive advantage:

US supplier to Mexico. If I want to purchase paint made by a US paint manufacturer and have it shipped to my warehouse in Mexico, my total cost to bring the goods to my warehouse in Mexico would be the cost of the paint, plus freight and customs clearing costs. There is no import tariff on this product due to the NAFTA free trade treaty. It would take 4 – 6 days to arrive in my warehouse in Mexico once the product has been shipped from the USA.

US paint $ 20.00 + Freight $ 4.00 + Customs $ 1.00 = $ 25.00 total cost of the US product in my warehouse in Mexico

Chinese supplier to Mexico. If I purchase the same product, from the same transnational company, but it is manufactured in China. Transportation time is 40 days from date product is shipped from China.

Chinese paint $14.00 + Freight $ 8.00 + Customs $ 1.00 + Import tariff (13% of CIF value) $ 2.86 = USD $ 25.86, total cost of the Chinese product in my warehouse in Mexico.

In this example the final cost of the product is $ .86 lower from the US supplier as compared to the Chinese supplier, despite a lower initial product cost. Factor in the financial cost and time required to move the product from the factory to my warehouse, and the lowest final cost in this case would clearly come from purchasing product from the US supplier.

Mexico’s aggressive free trade strategy

Since the 1990’s Mexico has bet heavily on international free trade agreements as a method to improve their competitive advantage and increase their manufacturing base and attract foreign investment.

Mexico has signed 11 existing free trade treaties and 2 complementary economic agreements with 42 countries. It is the only country in the world to have standing free trade agreements with North American and the European community.
The free trade agreements have greatly increased international competition (imports) in Mexico (good for the consumer).

Free trade agreements have allowed Mexican exports to increase and reach destinations and markets that were closed before due to tariffs and costs. There has been increased foreign investment from countries that desired to use Mexico’s free trade competitive advantage for international manufacturing and export projects.

The Mexican manufacturers and suppliers of the national Mexican market were given a “sink or swim” option. Virtually overnight (many of the treaties were phased in over a period of 3 – 10 years), their previous protected market was filled with imported goods (more competition, lower cost, higher quality).

Those that have survived the “invasion”, have had to improve their efficiency, quality and costs. Making them much more competitive in todays global economy.

Britannica’s Definition of free trade:

“Policy in which a government does not discriminate against imports or interfere with exports. A free-trade policy does not necessarily imply that the government abandons all control and taxation of imports and exports, but rather that it refrains from actions specifically designed to hinder international trade, such as tariff barriers, currency restrictions, and import quotas. The theoretical case for free trade is based on Adam Smith’s argument that the division of labour among countries leads to specialization, greater efficiency, and higher aggregate production. The way to foster such a division of labour, Smith believed, is to allow nations to make and sell whatever products can compete successfully in an international market.”

Related Links

Mexico and international free trade agreements





World Bank report – Doing Business in Mexico

23 09 2006

The World Bank has an on-line report available entitled “Doing Business in Mexico“. The study was published in December of 2005.

“Cosponsored by COFEMER, USAID, and the World Bank Group, Doing Business in Mexico is the first state-level report of the Doing Business series in Latin America. This report investigates the scope and manner of regulations that enhance business activity and those that constrain it.

The report covers the following thirteen Mexican cities and four areas of regulation: Starting a business, Registering property, obtaining credit and enforcing a contract.”

“When compared, Mexico City and the 12 other cities differ dramatically on the four indicators the report measures. “

The cities and regulations analyzed include: Aguascalientes, Celaya, Ciudad Juarez, Guadalajara, Monterrey, Veracruz, Merida, San Luis Potosi, Torreon, Mexico City, Tlalnepantla, Puebla, and Queretaro.

Of special note is the following comment. “The report concludes that reform is sorely needed. Much of the opportunity for improvement is in local administrative procedures, which can be changed by a governor or a mayor.”

This is very important. A governor or local mayor can make an important difference on the ease of setting up and doing business in Mexico. Seek out those states and cities with pro-active leadership. Find those areas that are investing heavily in infrastructure or have a dynamic policy focused on foreign investment and economic development.

Related Links

Doing Business in Mexico – World Bank

Doing Business in Mexico (PDF)

Press Release (PDF)





Airport codes for Mexico

21 09 2006

An alphabetical  listing, by city, of the 3 digit airport codes for Mexico.

  • AJS   Abreojos
  • ACA  Acapulco Alvarez International
  • AGU  Aguascalientes
  • XAL  Alamos
  • AZG  Apatzingan
  • BHL  Bahia de los Angeles
  • CPE  Campeche International
  • CNA  Cananea
  • CUN  Cancun
  • CTM  Chetumal
  • CUU  Chihuahua Villalobos
  • ACN  Ciudad Acuna International
  • CUA  Ciudad Constitucion
  • CME  Ciudad del Carmen
  • CJS  Ciudad Juarez International
  • MMC  Ciudad Mante
  • CEN  Ciudad Obregon
  • CVM Ciudad Victoria
  • CLQ  Colima
  • CZM  Cozumel Municipal
  • STZ  Cristobl Casas
  • CUL  Culiacan Bachiguala
  • DGO  Durango Victoria
  • ESE  Ensenada
  • GDL  Guadalajara Miguel Hidalgo
  • GYM  Guaymas Yanez
  • GUB  Guerrero Negro
  • HMO  Hermosillo P. Garcia
  • HUX  Huatulco B. Huatulco
  • ISJ  Isla Mujeres
  • ZIH  Ixtapa / Zihuatanejo International
  • IZT  Ixtepec
  • JAL  Jalapa
  • LAP  La Paz Leon
  • LZC  Lazaro Cardenas
  • BJX  Leon / Guanajuato del Bajio
  • LTO  Loreto
  • SJD  Los Cabos
  • LMM  Los Mochis Federal
  • ZLO  Manzanillo
  • MAM  Matamoros
  • MZT  Mazatlan Buelna
  • MID  Merida Rejon
  • MXL  Mexicali
  • AZP  Mexico City Atizapan
  • MEX  Mexico City Juarez International
  • TLC  Mexico City Morelos
  • NLU  Mexico City Santa Lucia
  • MTT  Minatitlan
  • LOV  Monclova
  • NTR  Monterrey Aeropuerto del Norte
  • MTY  Monterrey Escobedo
  • MLM  Morelia
  • MUG  Mulege
  • NOG  Nogales
  • NCG  Nueva Casas Grandes
  • NLD  Nuevo Laredo International
  • OAX  Oaxaca Xoxocotlan
  • PQM  Palenque
  • PDS  Piedras Negras
  • PNO  Pinotepa Nacional
  • PCM  Playa del Carmen
  • PUH Pochutla
  • PAZ  Poza Rica Tajin
  • PBC  Puebla Huejotsngo
  • PXM  Puerto Escondido
  • PJZ  Puerto Juarez
  • PPE  Puerto Penasco
  • PVR  Puerto Vallarta Ordaz
  • PCV  Punta Chivato
  • PCO  Punta Colorada
  • QRO  Queretaro
  • REX  Reynosa Blanco
  • SCX  Salina Cruz
  • SLW  Saltillo
  • SFH  San Felipe
  • SGM  San Ignacio
  • SLP  San Luis Potosi
  • UAC  San Luis Rio Colorado
  • SNQ  San Quintin
  • SRL  Santa Rosalia
  • TAM  Tampico Javier
  • TSL  Tamuin
  • TAP  Tapachula International
  • TCN  Tehuacan
  • TPQ  Tepic
  • TIJ  Tijuana
  • TZM  Tizimin
  • TRC  Torreon Sarabia
  • TUY  Tulum
  • TGZ  Tuxtla Gutierrrez Llano
  • UPN  Uruapan
  • VER  Veracruz
  • VIB  Villa Constitucion
  • VSA  Villahermosa C.R. Perez
  • ZCL  Zacatecas la Calera
  • ZMM  Zamora




Industrial and Business Parks in Mexico

20 09 2006

Looking for a “plug and play” solution for your business or factory in Mexico? Take a hard look at the advantages that Mexican industrial parks offer.

AMPIP (Mexican Association of Business and Industrial Parks) can partner with you and provide contacts and information about Mexico’s industrial and business parks. They work closely with private industry, state and local governments and real estate organizations in order to provide solutions for companies seeking to quickly and easily establish a physical presence in Mexico.

“Investment Promotion
AMPIP has become one of Mexico’s leading agencies for the promotion of foreign investment projects, thanks to its participation in national and international shows, the advertising in specialized media, the alliance with other business associations and the permanent contact with a wide network of corporations and real estate players, as well as with government officials.

Part of the promotion activities include the registration of industrial assets owned by AMPIP members in our Industrial Real Estate Promotion System, available on-line at our Internet site, apart from the printed material, such as location maps edited in conjunction with the Mexican Bank for Foreign Trade (Bancomext), which are distributed worldwide.”

There are specific and unique advantages of industrial and business parks. Saving time and money are among the biggest factors. Access to transportation, power and communication infrastructure is another. The definition of “Industrial Park” will provide some idea of the other advantages.

“What is an Industrial Park?

An industrial park is a delimited extension of land, characterized by four main aspects:

1. It is located close to transport facilities, such as hightways, airports, sea ports and railways.

2. It concentrates essential dedicated infrastructure in one location for industrial operations, such as water (including sewer lines, drainage systems), electricity (including high power supply lines), telecommunications and roads.

3. It fulfills all the prerequisites to obtain the permission from local authorities for the set up of new operations (construction, environment, etc.)

4. It has a central administration that coordinates the internal safety of assets, the maintenance of public infrastructure, the promotion of new operations and the affairs with local authorities”

For more detailed information, contact: Associacion Mexicana de Parques Industriales, Monte Camerùn 54 – 1, Colonia Lomas de Barrilaco, C.P. 11010, Delegacion Miguel Hidalgo, Mèxico D.F., Mexico Tel. +52 (55) 2623-2216 Fax +52 (55) 2623-2218 Email ampip@ampip.org.mx

Related Links

AMPIP Mexican Association of Business and Industrial Parks

Official Government websites of the 32 Mexican states

How to do business in Mexico

How to negotiate with Mexican business people

Mexican official (and unofficial) holidays

Tip: How to call Mexico from the US

What to dial in order to reach a cellular phone in Mexico

Advice on what to expect when doing business with Mexico

Meeting people in Mexico – kiss, shake hands or hug?

Before you go on your business trip to Mexico

Tipping Guidelines for Mexico





Mexico and international free trade treaties

19 09 2006

Mexico has signed 11 international free trade treaties and 2 complimentary economic agreements since 1993.

Mexico is the only country in the world with active free-trade treaties that cover North American and the entire European Community.

These free trade agreements have made Mexico highly competitive in terms of manufacturing for export to world markets, for the importation of raw materials for manufacturing and for the import of consumer goods for sale in Mexico.

The free trade agreements currently in place include:

  • TLCAN – Includes Mexico, USA and Canada – Initiated January 1, 1994 (NAFTA in English)
  • TLC-G3 – Includes Mexico, Colombia and Venezuela – Initiated January 1, 1995
  • TLC Mexico-Costa Rica – Includes Mexico and Costa Rica – Initiated January 1, 1995
  • TLC Mexico – Bolivia – Includes Mexico and Bolivia – Initiated January 1, 1995
  • TLC Mexico – Nicaragua – Includes Mexico and Nicaragua – Initiated July 1, 1998
  • TLC Mexico – Chile – Includes Mexico and Chile – Initiated August 1, 1999
  • TLCUEM – Includes Mexico and the European Union (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Holland, Ireland, Italy, Luxembourg, Portugal, Spain, Sweden, United Kingdom, Cypress, Czech Republic, Estonia, Latvia, Lithuania, Malta, Poland, Slovakia, Slovenia) – Initiated July 1, 2000.
  • TLC Mexico – Israel – Includes Mexico and Israel – Initiated July 1, 2000
  • TLC Mexico – TN – Includes Mexico, El Salvador, Guatemala and Honduras – Initiated on March 15, 2001 with El Salvador and Guatemala and June 1, 2001 with Honduras
  • TLC Mexico – AELC – Includes Mexico, Iceland, Norway, Liechtenstein and Switzerland – Initiated July 1, 2001
  • TLC Mexico – Uruguay – Includes Mexico and Uruguay – Initiated in July 15, 2004
  • AAE Mexico – Japan – Includes Mexico and Japan – Initiated April 1, 2005

In addition there are Complementary Economic Agreements (ACE’s) in place with Brazil and Argentina.

Related Links 

Why you should pay attention to free trade treaties 





Business in Mexico, conversation themes

15 09 2006

When going to Mexico for business, be prepared for conversations. Mexicans are social people. They love to gather in groups and socialize. You can be assured of plenty of conversations during your visit.

Most business meetings and business dinners will involve a great deal of conversation of off-topic ideas before getting to business. Your ability to participate and keep the conversation moving is an important part of creating trust and the bonds required for doing business successfully in Mexico.

What topics are of general interest in Mexico?

Be cautious about introducing your personal opinions about politics and religion. Asking others to explain the current situation, so that you can understand it, is a safe way to venture into themes related to politics and economics.

Currently (September 2006) the following themes are sure to provoke conversations, discussions and opinions when in Mexico.

  • The recent Mexican presidential elections. Predictions for the future, scenarios, how it will might affect business and Mexico.
  • Your industry or business sector. Any international or national news, information, gossip, trends or tendencies related to your business sector.
  • Infrastructure projects in the city or state where you are visiting
  • China and it’s impact on the Mexican economy
  • Children and family
  • News or current events that can be found on the front page of the local or national newspaper
  • Recommendations on when and where to vacation in Mexico

Related Links

Create great international relationships

Advice on what to expect when doing business with Mexico





Cultural misunderstanding, it can happen to you.

15 09 2006

When we think of industry leaders in marketing and branding, Disney comes to mind. Geniuses in promoting their brand. Magnificent marketers. Leaders in the theme park industry. Universally recognized brand.

What could possibly go wrong with their expansion into Hong Kong and the Asian-Pacific market? Cultural misunderstanding.

Expansion into international markets and working with other cultures has created unforeseen headaches and problems for Disney once again. Disneyland struggles in Hong Kong

This is not the first time Disney has encountered cultural problems in international projects. EuroDisney also suffered from problems related to culture and customs that were not predicted or not taken seriously.

Disney is not alone. Virtually all organizations seeking to export and participate in international markets face steep learning curves about culture, customs and manners. Mistakes are made, at times very costly mistakes.

The lesson to be learned is to spend the time and money to understand your international markets and the culture where you will be doing business. It’s not enough to understand your brand and current customers. Never underestimate any cultural factor, and never assume that your model, project or way of life will be embraced fully and without reservations.

Related Links

Create great international business relationships

Stereotypes and global business





Create great international business relationships

14 09 2006

Working with individuals and ideas from cultures different from our own is complex, and filled with opportunities to misunderstand and offend everyone involved. It requires time to develop trust and understanding for all the players involved.

Take the time to learn how and why business is done in the country. Don’t judge the results based upon your culture and your country’s standards.

There is nothing more damaging to an international relationship than criticism based upon a lack of understanding. You must learn before you attempt to teach new ideas, strategies and procedures.

When doing business in Mexico remember that no matter what you feel or believe about your company’s products or procedures, Mexicans know their market and people better than you do. They know the correct business etiquette and the “invisible” cultural nuances that are required in order to do business in Mexico.

If you enter into business in Mexico with the idea that you are going to “teach the Mexicans how business is really done” I am confident you will suffer some serious problems.

Pushing procedures and business strategies into Mexico will surely cause divisions, it can turn into an “us versus them” situation for employees and customers.

I recommend that your focus be on learning and understanding how business in currently done in Mexico, and why. Once you have this knowledge, teach and explore your cultures and organizations solutions and strategies with your Mexican collaborators. I’ll bet the ideas will get modified if necessary, implemented and embraced quickly.

The creation of hybrid strategies, using elements from both cultures, will guarantee unification and understanding for everyone involved.

Before you start a revolution it’s essential to fully understand the status quo.

 

Related Links

International Business Tips

Stereotypes and global business

International business traveller – ambassador, explorer, map-maker





Official government websites of the 32 Mexican States

13 09 2006

Links to the Official Government Websites of the Mexican States

  • Oaxaca – Not currently available
  • Tlaxcala – Not currently available

Many of these sites have the information available in the english language. Search the entry page for links to versions in english (or ingles).

Related Links

How to do business in Mexico

How to negotiate with Mexican business people

Mexican official (and unofficial) holidays

Tip: How to call Mexico from the US

What to dial in order to reach a cellular phone in Mexico

Advice on what to expect when doing business with Mexico

Meeting people in Mexico – kiss, shake hands or hug?

Before you go on your business trip to Mexico

Tipping Guidelines for Mexico





Tipping guidelines for Mexico

13 09 2006

Tipping is always a concern for travellers. In Mexico, tipping is very common and expected, but there are no fixed rules for the amount of the tip. If someone is providing an extra service or favor for you, a tip would be expected and welcome.

You should always have loose change and low denomination bills with you in order to make the transaction effortless.

You should tip with the quantity that you feel comfortable with. I’ve provided some tip guidelines that should help get you started.

Basic guidelines for tipping in Mexico.

  • Restaurants – the normal tip amount is 10% -15% of the bill. There is a national value added tax (IVA) of 15% included on all restaurant bills, this is not the tip, this is a tax.  Many people leave a tip equal to the IVA, 15%, or leave 10% of the total bill that has the IVA tax included.
  • Bellhops and luggage handlers – $ 10 – $ 20 pesos per bag.
  • Hotel maids – $ 20 – $ 50 pesos per day.
  • Taxis – Depends upon the city, type of taxi (meter or negotiated price). If a metered cab, a tip would be expected perhaps 10% of the total. If the taxi is a negotiated price no tip would be expected. If a fixed rate to destination cab (for example airport cabs) a tip would be appreciated $ 10 – $ 20 pesos.
  • Gas station attendants – $5 – $ 10 pesos depending on the level of service
  • Bars – 10% of the total bill
  • Valet parking – $ 10 – $20
  • Grocery store baggers – $ 5

Related Links

How to do business in Mexico

Mexican official (and unofficial) holidays

Advice on what to expect when doing business with Mexico

Tip: How to call Mexico from the US