How to Navigate U.S./Mexico Crossborder Manufacturing Logistics

mexico-manufacturing

Two of the most frequently asked questions we hear from new clients about manufacturing in Mexico are: What can I expect from crossborder logistics and U.S./Mexico Customs? And what, if anything, could go wrong during shipping?

MFI International is a full-package, or “turnkey” manufacturer, which means crossborder logistics are built in to our service contracts for U.S./Mexico clients.

Simply put, MFI handles your incoming raw materials at our U.S. warehouse, arranges the Customs paperwork for crossborder shipping, delivers the materials to MFI’s Mexico factories where they’re assembled (as part of our cost-savings strategy), then transports the finished product back (FOB or “Free on Board”) to our El Paso, Texas warehouse for a reasonable cost, where you arrange for its freight out to your customer destination.

At every step, MFI provides essential crossborder coordination to prevent costly glitches.

For example, it’s critical that a shipment’s Tariff Classification be handled correctly. Tariff classification determines the duty rate and whether the good is eligible for NAFTA savings.

Why This Matters: If a product is classified incorrectly, the client (you) could incur penalties, or lose out on valuable NAFTA or other preferential treatment reductions.

That’s why it’s important to choose a seasoned turnkey manufacturer who has extensive experience with U.S. and Mexican Customs authorities, and can ensure that your products receive the proper tariff classification and trade incentives.

MFI not only finesses these, we are also the first manufacturer of textile assemblies in Mexico with our own corporate Mexican Customs broker.

Jorge Fierro, who coordinates all crossborder and Customs activities for the company with the Mexican government, explains, “It’s a huge benefit. It speeds up the entire process and makes it far more efficient because we control every aspect and do not need to rely on an outside Mexican broker.”

We’ll be answering more FAQs about manufacturing in Mexico and crossborder logistics in future entries here on our blog. To stay up to date, subscribe at the top right of the page.

Download:MFI's Contract Manufacturing Presentation