If you are thinking about setting up a Mexican warehouse, you will need to take into account some essential considerations, from the location of your establishment to the licenses you need to obtain to operate efficiently and without interruptions.
Establishing a Mexican warehouse doesn’t have to be complicated, especially if you work with a warehouse setup consultant, who will provide expert advice on how to organize a facility. They can also manage the setup, including installing infrastucture such as racking and floor marking, while making sure you comply with local safety regulations.
SEE ALSO: What are some key concerns when setting up a warehouse in Brazil?
There are many good reasons to consider setting up a Mexican warehouse, such as its strategic location and competitive labor force. With nearshoring a rising trend, businesses from the United States in particular are increasingly looking at their southern neighbor as an investment opportunity.
At Serviap Logistics, we can help you set up a Mexican warehouse. Contact us to find out more.
Why open a warehouse in Mexico?
Mexico is a competitive country, rich in resources and with a modern world-class infrastructure, making it an attractive destination for foreign investment. Consequently, it is also a key territory for establishing various types and sizes of warehouses.
As a solid and open economy —the Mexican economy is the 2nd largest in Latin America and the 16th worldwide—, it guarantees access to international markets through free trade agreements. It also offers competitive costs, young and highly qualified human capital, and the capacity to produce advanced manufacturing.
This nation, the third largest territory in Latin America, is the gateway to the United States, one of the most important markets in the world. It is also connected to Central America to the south, sharing a border with Guatemala and Belize. Thus, thanks to its strategic location, many companies choose to establish a Mexican warehouse.
As an important logistics hub in the Americas, a strategic point in a distribution network that crosses the entire continent, Mexico has 117 seaports, almost 400,000 kilometers of highways and 76 airports.
Tijuana, Guadalajara, Monterrey and Mexico City have established themselves as the cities with the highest industrial and manufacturing growth, where large warehouses which serve various sectors such as automotive, food, health, and retail, are located.
Due to the growth of e-commerce in the country in recent years, especially since the COVID-19 pandemic, the Internet sales giant Amazon has opened several distribution centers in the Republic, in strategic locations that include the states of Nuevo Leon, Jalisco, Yucatan, and Baja California.
In addition, the Mexican Government has promoted the creation of industrial parks to enhance the competitive development of companies by providing them with adequate industrial infrastructure, organizing industrial settlements, and deconcentrating urban areas.
The Mexican Republic also has Almacenes Generales de Depósito, entities that store, conserve, handle, control, distribute or commercialize goods or merchandise in their custody or transit, covered by certificates of deposit. These entities grant financing by taking the products as collateral.
Key aspects of setting up a warehouse in Mexico
Before establishing a Mexican warehouse, it is necessary to consider some key aspects. For example, the location of the warehousing business or distribution center, infrastructure, human resources, regulations, and safety in these establishments may differ throughout the federal territory.
In terms of location, for example, the cost of living is higher in the north of the country, meaning greater payroll costs. On the other hand, it is closer to the United States and Canada, so the movement of goods to these neighboring nations may be cheaper and more accessible.
Strategic locations near seaports should also be considered. In Mexico, the most important port is Manzanillo, on the Pacific, where ships from China, Japan, India, and the west coast of the United States arrive and depart. There is also the port of Lázaro Cárdenas, with a dynamic capacity of 600,000 vehicles per year.
The port of Veracruz, the biggest in the Americas, is located on the Gulf of Mexico and has connections mainly with North America, Central America, South America, the Caribbean, Europe, and Africa.
Concerning the standards for operating a warehouse, the Secretariat of Labor and Social Welfare regulates the handling and storage of materials in any Mexican warehouse, from the obligations of the employer and workers to safety and hygiene procedures, the loading of materials, and verification units.
Launching a warehouse in this territory also involves hiring trained personnel, such as engineers, specialized machinery operators, security guards, cleaners, and anyone else who is needed to help the warehouse operate smoothly.
To hire trained personnel following local regulations, companies that want to establish a Mexican warehouse can acquire the services of an employer of record (EOR), responsible for finding, hiring, and managing staff on behalf of its clients.
Also, before setting up a Mexican warehouse, ensuring that the infrastructure that will house it has reliable electricity, water, drainage networks, and a solid structure in case of earthquakes is essential. The important thing is to form a team of experts to take the necessary measures to ensure the safety of personnel and goods to be stored.
7 steps to set up a Mexican warehouse
To set up a Mexican warehouse and start operations successfully, follow these steps:
1. Have a business plan
Like any other business, you need a business plan to set up a warehouse in Mexico. This document should include the type of store, the target market, the resources required for its launch, whether it will only offer storage services or shipping and distribution, the commercial structure, an organizational chart, the budget, and the competition.
This series of steps must be well written and precise, as it will be indispensable if you want to apply for a loan or additional financing.
2. Define your market
Defining your market and the services you will offer will be essential to know what you need, from the type of building to the shelves and signage you will need to place.
Defining the industry to which you want to offer your storage services will help you know the technical specifications that your Mexican warehouse must comply with, such as cold storage areas or special zones to safeguard delicate merchandise safely.
3. Find a location
Knowing the sort of goods and products you want to store or distribute will help you define the space to establish your Mexican warehouse. It is best to rent a property to start operating as soon as possible, although this monthly cash drain can be significant in the long run. You also need to consider where in the country is best for your needs.
If it is within your budget, you may want to buy a warehouse. Although the initial investment may be high, you will be able to make the necessary renovations as your business grows. Finally, you can build a warehouse from scratch, an even more significant expense but one that will give you the freedom to have a property to suit your needs.
4. Design your layout
Once you have defined where you will set up your warehouse, designing the layout of the critical areas is crucial for the efficiency of the operations since you will need the loading and unloading area, the reception, the storage zone, picking and shipping of goods, as well as the offices, restrooms, and cafeteria.
Remember that, to plan the layout of your warehouse, you must consider the flow of goods, the space you have available, the storage equipment and its characteristics, besides safety and sustainability standards.
5. Get operating licenses
Obtaining specific licenses from the Secretariat of the Treasury and Public Credit is necessary to establish and operate a warehouse in Mexico. For example, if you wish to develop a general bonded warehouse (Almacén General de Depósito) located in customs zones, you must submit a written document describing the reasons for opening the warehouse.
Also include the general operating plan, the financial viability model, policies and procedures manuals, as well as an organization manual and a geographic coverage program.
6. Acquire equipment
To succeed in your warehouse and turn it into a profitable business, you must purchase specialized equipment, from tools to machinery and vehicles. This equipment will make your employees’ jobs easier, improve the flow of goods, and help maintain safer environments.
In a Mexican warehouse, you will need dock equipment, such as dock boards, ramps, and levelers; conveyors, either gravity roller or belt conveyors; storage equipment, such as shelving; lifting equipment, like forklifts, service carts, or cranes; as well as packaging equipment.
7. Hire your staff
Besides warehousing equipment, a storage facility cannot operate without personnel. Therefore, before setting up a Mexican warehouse, you should consider how many people are needed, for which areas, and whether they require specific skills.
Consider hiring shipping and receiving staff, machine operators, material handlers, forklift drivers, storage personnel, security guards, managers, and, eventually, professionals to maintain your facilities and equipment to keep them in good condition.
Serviap Logistics can help with setting up a Mexican warehouse
At Serviap Logistics, we are experts in Mexican warehouses, as we started operations in this country before expanding to Brazil and the United States, territories where we also offer our services according to the highest safety standards.
If you want to open a Mexican warehouse, we can help with signage, labeling, floor marking, equipment assembly, and collision protectors. We can also manage your projects, whether you are relocating a warehouse or renovating it.
We have clients and partners from diverse sectors, such as automotive, e-commerce, and wholesale, industries that are becoming more profitable every day in the Mexican territory.
Contact us to learn more about our services and everything we can offer you to assemble a Mexican warehouse.