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Outsourcing Easiest for Foreign Entrants

Alex Mahoney - Biz Latin Hub
Country Manager

STORY INLINE POST

Thu, 09/01/2016 - 16:17

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Q: What are Biz Latin Hub’s priorities for the Mexican market?

A: Biz Latin Hub has a strong presence in Colombia, Peru, Chile and Argentina, and we opened offices in Panama recently. Our focus is back-office services including accounting, payroll, legal and recruitment. We began operating in Mexico five months ago and we have already formed strong relationships with clients in the automotive and oil and gas industries. We are not limited to the industrial sector. We also have clients in the services industry and a strong background in mining thanks to our operations in Colombia and Peru. Biz Latin Hub is defining its focus in Mexico and we have already landed a contract with a Chinese company that manages vehicle imports and exports. For these activities in particular we have a lawyer specialized in foreign trade.

Q: What services are most in demand among new clients of Biz Latin Hub?

A: Foreign clients normally look for someone who speaks English and understands what they really need to succeed in the Mexican market. Even though we offer the same services as larger competitors, our competitive advantage is that we handle all operations directly with the client. Customers appreciate this personal attention and flexibility, and we offer competitive prices.

We have had to work hard to secure new clients since we are still building our brand’s presence. We give initial advice to the customer to demonstrate how, despite not having 200 people on our premises, everyone we employ is an expert in their field. All our staff members are bilingual. As well as understanding the intricacies of the Mexican market, our specialists know how to address the needs of the client according to their place of origin.

We manage our recruitment services from Colombia but the intention is to offer these services from our Mexico office within the next 12 months. Having representation across most of Latin America has helped us connect clients that wanted a stronger presence in the region. It also serves to build on the long-term relationship with the client.

Q: What are Biz Latin Hub’s strategies to penetrate the Mexican automotive market?

A: Our experience in other regions gives us an advantage in the automotive market. We cannot ignore the industry’s booming growth in Mexico. Once we consolidate our accounting and legal services we will start offering due diligence, background checks and business advisory solutions in Mexico. We are focusing on English and French speaking companies although we are open to any business opportunity. Most of our existing customers contacted us through a previous client, our webpage or directly at an event. We are also in contact with embassies and chambers of commerce but we have found working with these entities to be a slower process.

Q: How have outsourcing services changed the labor environment in Mexico?

A: Depending on the line of business of each company, it can be cheaper and more efficient to handle these operations in-house. But there are times where the company does not want to be liable for these activities. Labor laws are particularly strict in Mexico, which can be daunting for a foreign company considering introducing operations in the country. Certain companies simply do not want to handle all the paperwork related to contracts, social security or payroll, so they outsource these processes to us. It is a short-term solution for some but other companies with long histories in Mexico still manage their staff and back-office operations this way.

Q: What do you see as the biggest challenge for foreign companies that want to understand how the Mexican market works?

A: One of the biggest surprises for foreign companies is the flexibility of Mexican law. It can be difficult for foreigners to understand how business is done locally. German or British people are very direct, while Mexican people tend to think about what they want and want to build a relationship with the client before stating their intentions. There are legal discrepancies in the incentive programs put in place by the government. Thus, most companies need a specialist to guide and support them.

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