Mexico, the neighbor next door

The United States – Mexico Border is approximately 1,989 miles long. With 330 ports of entry, it is the most frequently crossed controlled international boundary in the world. The proximity of these two countries allows shipments anywhere in the U.S. to reach Mexico within 2 - 3 days rather than the 4 - 6 weeks needed to get products from Asia. Yet there are many differences between the countries that are often overlooked. The culture, accounting principles and logistics are a few good examples relevant to good international business practices. Focusing on logistics, below are some insights and considerations to get your business started with shipping into Mexico successfully.

    1. International shipping is 80% preparation, 20% execution.

First, you need to have a clear road map of the supply chain. Who are the parties involved and what is their role? Is everyone aware of what they are supposed to do and when they are supposed to do it? If this is your first shipment you will want to have at least one conference call with all the players where you go over everyone’s responsibilities and review that all tasks are accounted for and assigned. I recommend having a checklist with all the required documents, and assigning each document to a person or team.

     2. Know your product.

No one knows your product like you do, Customs Brokers will ask many questions about your product (if they do not you should be worried), and the more information you can provide, the more accurate your Customs declaration will be, saving you from hassles along the road. There are items which are regulated by Customs and require permits before being imported or exported, is your product one of them? Letting your Carrier know ahead of time if your product can be transloaded or if it should be tarped will allow them to prepare for the trip and prevent delays at the border.

    3. Know what you are getting into.

Do you know the International Commercial Terms (Incoterms) for the shipment? If you will be responsible for the shipment to the border it is important to know if you are also expected to act as the exporter of record. Is the shipment DDP? Even though the seller bears the risks and costs to the place of destination they will still need to work with the importer of record to complete the importation of the goods. Is your shipment in compliance with the Mexican tributary agency (SAT) or are your inadvertently setting up your company as a Mexican entity?

    4. Know who you are working with.

Always make sure that you are working with a reputable company. Regulation of transportation carriers in Mexico is less constrictive than in the U.S. The knowledge you acquire can be the difference between a successful relationship between you and your customer or loss of business and revenue. Do not be afraid to ask your partners for recommendations ranging from the best time to cross the border to current security practices of international shipments.

The main point to remember is that Mexico's proximity to the U.S. does not mean that industry practices are standardized across the Border. Due diligence now can mean peace of mind later.