Developing the optimal supply chain is a primary focus for any manufacturer. With many U.S. businesses offshoring their production process, the global manufacturing lifecycle is becoming longer, and creating a shorter front end and tail is essential. There are numerous reasons why more U.S. businesses are deciding to enter the competitive manufacturing market in Mexico. Of all the offshoring destinations, Mexico's skilled supply chain candidates and its close proximity to the U.S. allows manufacturers to keep the supply chain short and affordable. However, U.S. businesses are often unable to do all of this on their own. Shelter companies have the knowledge needed to help manufacturers make the right decisions about their supply chain, so businesses only have to worry about producing high-quality goods.
Choosing the best supply chain candidate out of many
According to Manufacturing.net, many businesses have numerous suppliers around the globe that can cause issues if there is a kink in supply chain communication or issues arise in the country. When manufacturers employ too many suppliers and need to scramble to keep up with having many factories around the world, the supply chain suffers. Creating a flexible supply chain is only half the battle businesses face when they offshore their production process; according to Manufacturing.net, ensuring they choose the right suppliers is the other challenge.
In an interview with the Council of Supply Chain Management Professionals' (CSCMP) Supply Chain Quarterly, Rolando García, a manufacturing expert, said Mexico has experienced supply chain talent that puts the country above other offshoring options. According to García, industrial areas such as Guadalajara and Chihuahua offer a qualified pool of highly skilled supply chain candidates who understand the ins and outs of how the specific industry works in Mexico.
"First, these cities have been home for many decades to global industries such as car manufacturers and their suppliers, American retailers and their distribution centers, pharmaceuticals, petrochemicals, and steel and cement," García said. "So the people in these cities have experience in these industries and are used to working with high quality standards."
Having only one or two supply chain managers and suppliers who can deliver high-quality products and services can be a big bonus for U.S. manufacturers. While having many suppliers may sound like a good idea, it can create headaches later on and may damage the business' reputation if goods or services don't meet the same standards, especially if the business itself is a supplier.
Keeping supply chains short
With supply chains becoming longer across the board, manufacturers need to always keep distance and time in mind when offshoring their production process. Expanding into a foreign country is already a huge investment for businesses, but adding an ocean between where the products are manufactured and their main market can become expensive and difficult to handle. While there are many ways businesses can monitor their overseas operations and the supply chain, expanding to a country that is near to the U.S. border but offers the same low cost manufacturing benefits can be the optimal solution.
According to Industry Week, manufacturers should to construct a responsive supply chain to meet their business targets and stay adaptable, yet offshoring destinations like China and India don't provide these benefits. The supply chain need to be strictly structured when products are moved from overseas to the U.S., allowing for low flexibility. As Mexico is a neighbor to the U.S., companies can transport product quickly and easily across the border while having a shorter supply chain. Manufacturing.net suggested U.S. businesses rethink how they monitor their supply chains, as more doesn't always equal better.
Whenever manufacturers decide to offshore their production process, it is essential they consider how they will accomplish it. Choosing a shelter company provides businesses with insider expertise about the Mexican manufacturing industry and also helps to ensure a smooth supply chain.