Manufacturing Industry
The manufacturing industry in Mexico faces unprecedented events. The sector is being transformed by restrictions on the border, pandemic confinement, economic recession and new regulations. The North American region, since their integration with the US industry, finds the Mexican industry sector as a highly dynamic and competitive one.
Published on August, 2020
Ana Karen Tello & Jorge Juarez
The sector encounters severe restrictions for the return of their employees, impacting economic activity indicators and employment such as turnover and productivity. Also, the decline of the internal consumption has resulted in the drop of income and inventory levels. On the other hand, the new USMCA regulations increase costs and force a restructure of the value chain.
Companies should start a process that can make their supply chain more transparent, pinpointing vulnerabilities and creating emergency protocols. The different organizations will have the capacity to view their direct and indirect suppliers with the purpose of identifying weaker inputs and mitigate risks. The companies with transparent chains will also have visibility of their clients and supply chains.
Given the period of uncertainty we live in, companies should have competent foreign trade teams, as well as lean on experts in order to avoid delays in the manufacturing plant supply. As a result of the drastic changes in the demand resulting from COVID-19, we recommend diversifying the supplier portfolio as well as production. It is vital to determine the most vulnerable point within the supply chain, identifying the major risks associated with each one of the parts and inputs.
(PDF Article Only Available in Spanish)
Companies should start a process that can make their supply chain more transparent, pinpointing vulnerabilities and creating emergency protocols. The different organizations will have the capacity to view their direct and indirect suppliers with the purpose of identifying weaker inputs and mitigate risks. The companies with transparent chains will also have visibility of their clients and supply chains.
Given the period of uncertainty we live in, companies should have competent foreign trade teams, as well as lean on experts in order to avoid delays in the manufacturing plant supply. As a result of the drastic changes in the demand resulting from COVID-19, we recommend diversifying the supplier portfolio as well as production. It is vital to determine the most vulnerable point within the supply chain, identifying the major risks associated with each one of the parts and inputs.
(PDF Article Only Available in Spanish)
Related Insights
The growth potential of emerging economies
Economic power has spinned around countries in Asia and emerging economies, promising to transform them in a few year in the new players of world commerce. The growing economic power of emerging economy countries was driven in the beginning by the intensity of their production processes, together with the low wages paid within their organizations.
Globalization: An interconnected business world
Globalization is the process and strategy of businesses towards their expansion and operation in new markets. Activities abroad are boosted by new strategies and process transformations. The commercial sector and economic entities connectivity present a series of intangible benefits, driving the enterprise business expansion. Here, we will explore the main indicators of an interconnected and globalized world.
Strategies to bolster the Supply Chain
The supply chain includes the strategic and integral process of organizations in the creation of a product, this being comprised of relationships between various entities. The production and profitability of organizations will depend on the level of efficiency of their supply chains. In every sector, the supply chains are the cornerstone of company productivity. However, these have shown to be vulnerable to disruptive events, risking operational continuity.
