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Managing Risks in Mexico
The authors warn that any company considering a move to Mexico must manage both the old risks of a developing country and the new uncertainties of an open market. Since the 1960s, U.S. companies have operated "maquiladoras," factories near the border that use Mexican labor to assemble products for export. As trade barriers come down, these factories will compete for the first time with the most successful Mexican companies, and other fierce competitors. Hiring local managers and finding local partners have helped some companies manage the inevitable risks. But depending on a company's size and core business, the risks of doing business in Mexico may outweigh the benefits.