Trade between the United States of America and the state of Mexico continues to grow at a rapid rate. Then US President, Bill Clinton, initiated the exponential growth back in the early 90s. Another factor, which is responsible for the increase in trade between the two countries, is that many corporations in the United States tend to exploit the labor conditions in Mexico. As complex as this is, it has also been beneficial to Mexican workers who can’t find work in their own countries.
Now the US is investing in developing state of the art infrastructure, which doesn’t exist Mexico. There are a few things to note when we look at how the logistics in the case of nearshoring to Mexico from the United States of America. They are as follows:
3-Legged Freight movements at US-Mexico Border
Sending shipments across the border, either way can be quite complicated. Each of the two countries has restrictions in place when it comes to trucks crossing the borders, even for business purposes. The state of Mexico prohibits American trucks to merely 16.16 miles inside of the border. It can be the Texas-Mexico border or the California Mexico border.
However, the same law will apply to any US-Mexico border. On the other hand, the United States also has strict rules, which trucks coming into US territory must abide by. Restrictions always yield in a 3-legged or 3-step process for trucks coming either way, regardless if it’s North-South or South-North. The USA created some programs to speed up the process of trucks deemed a low risk to cross the border. This ensures smoother business dealings.
Need for good warehouse management software
Large businesses from the USA, which are doing nearshoring from Mexico, need to understand that a warehouse management system can benefit them. If a company has a different type of units produced and multiple processes in the production cycle, they will be more willing to invest in good warehouse management software. A software of this nature can increase inventory turns, lower carrying expense, increase productivity. Productivity is increased because many processes are streamlined as a result.
Need for better communication and negotiation
US companies should learn the art of the deal. They need to be able to communicate effectively with Mexican partners. America has a short supply of drivers for long haul shipments. The US should work with the Mexican government to issue a visa to Mexican drivers so they can enter the USA for up to 12 days to finish their delivery. They should make use of temporary short-term visas for skilled workers. In this case, drivers are an essential part of the supply chain.
Technology is a significant facilitator of logistics success, like in many facets of transportation either nationally or overseas. A Transportation Management Program will maintain deliveries on board, south, and north of the US-Mexico state line, plus all points throughout, from help with efficiency to better exposure in the method.