In Mexico , there is a boom in the manufacturing industry, its chain of imports and exports. The country is one of the best logistics hubs in the region, and it continuously improves the capacity of its infrastructure and transnational logistics services in transportation.

With the strengths of the logistics chain for the manufacturing industry , there are certain challenges to consider when choosing the right outsourced logistics provider (3PL): its performance.

An exporter will be able to take advantage of the capacity offered by logistics in Mexico, but they need to choose a suitable partner.

According to the World Bank, “Logistics performance both in international trade and in the domestic market is essential for economic growth and competitiveness of countries (…) Efficient logistics connects people and companies with markets and opportunities, and helps achieve higher levels of productivity and well-being ”.

The World Bank’s Logistics Performance Index shows that the performance standards of the logistics chain in Mexico are above the average for Latin America and the Caribbean, and only follow Panama. The index measures:

  • The efficiency of customs procedures and border procedures.
  • The quality of the trade and transport infrastructure.
  • The ease of managing shipments at competitive prices.
  • The competence and quality of logistics services, such as transport, distribution and customs.
  • The ability to track shipments.
  • The frequency in which shipments reach the recipient according to the planned times.

Thus, Mexico reaches number 7 in logistics performance among countries with the same income levels.

Local logistics performance. Choose your partners wisely

In terms of local performance, the World Bank uses four factors:

  • Infrastructure.
  • Services.
  • Border Times and Procedures.
  • Reliability of the Logistics Chain.

Mexico also exceeds some of the region’s standards, but has challenges in some others. Although the distances exceed 1,600 kilometers in  its land logistics, and more than 200 kilometers in transport through ports and airports:

  • The average delivery time of its exports and imports are less than or similar to the average for the region.
  • They have short clearance times in customs, with or without technical inspection.

However, some logistics procedures and operations need to be improved, for which a good 3PL outsourced logistics provider should be chosen:

  • 42.86% of those surveyed agree with the levels of storage or transshipment charges.
  • 28.57% have an evaluation of the competencies of land freight transport companies.
  • 14.29% rate the quality of the customs broker’s management with a high note.
  • 28.57% consider that the quality of those who manage their consignments is high.
  • 57.14% consider the exit and delivery of imports efficient, transparency of their customs management and timely information on their changes in the regulation.
  • 66.7% indicate that they have the ability to choose the location of their customs procedure.

As we can see, the reliability of the logistics chain is one of the main concerns of importers and exporters. That is why choosing the commercial partner in Mexico is essential.

In fact, according to  Global Supply Chain Institute at the University of Tennessee , outsourced logistics is evolving from being technical providers of logistics and transportation services, or warehousing, to being “collaborative partners with a wide range of products.”

The report of this institute indicates that the best 3PL providers:

  • They use management tools such as LEAN management, and the latest continuous improvement technology.
  • They have state-of-the-art transportation and warehouse management software, as well as other capabilities to make operations more efficient.
  • They have the means to optimize and select the optimal warehouse locations and multi-channel shipment flow management.
  • It has a real-time monitoring system and an event management system.

So, following the World Bank Performance Index, ask yourself about your logistics provider.

  • How do they help you streamline customs management?
  • What type of infrastructure do they use?
  • How competitive are your prices?
  • How competent are your tax, warehousing and distribution services?
  • How do you monitor the status of your shipments?
  • How often do your shipments meet the times and deadlines required by your customers?

When you have found a supplier with the management and expertise to ensure these performance indicators in Mexico, don’t let it go.

How do you rate the performance of your logistics provider?

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