Over the past few months, we have talked with dozens of North American businessmen who, when it comes to how they perceive Mexico, all agree that it is a jungle of corruption and bureaucracy. And even with that issue, a market of 130 million people is still tremendously attractive.
The success of a business is due, in large part, to correct strategic planning and having the right business partners that will take you where you actually intend to go.
Let me tell you about a couple of cases in which the outlook for entrepreneurs was extremely encouraging, however, their efforts were misguided. The first of them sought to attend government tenders. I was sure that, with a recently created company, without creditable capital or experience in Mexico, I could only access it with the credentials of what I had done in the USA. The reality is that it was not. It did not even pass the first filter of the only tender in which it participated.
The second of the examples is from someone who incorporated a company and immediately sent a full shipment of electrical items (lamps) without knowing the local regulation regarding compliance with NOMs (Mexican official standards) to bring their product into the country. I don’t need to tell you that the result was catastrophic, the paperwork and taxes ate it up.
The first lesson from these examples is that ignorance of local laws and procedures could bring down a business that, in the right circumstances, would have exploded and flourished. This is more common than you might imagine and is repeated constantly.
Do not be discouraged, because now we will mention a couple of success stories. The first is a company dedicated to energy that was created with the intention of participating in government tenders. Already having the context of the first case, co-participations were negotiated with Mexican companies (it did not matter if their capital was foreign), which already had capital and experience, the value offered by this recently created company was identified, achieving productive synergies that allowed it to enter into the Mexican market, giving way to consolidate what is necessary to become a player in its own right and currently has awarded projects that it has successfully developed.
The second example is in pharmaceuticals, where we have managed to set up a bioequivalent drug laboratory that, through proper advice on various legal issues, will soon achieve its presence in the national market, opening the door to take root and continue its expansion.
The moral of these stories is that with the necessary advice, it is less complicated to achieve our goals.
Another point that causes uncertainty for the foreign investor is the prohibition of outsourcing in Mexico; if, from September 1, 2021, subcontracting is considered illegal in our country, which implies, among other complications, that companies cannot exist without personnel, giving way to the nightmare that Social Security can be, without starting to talk about SAT (IRS in Mexico). The point is that, like all laws, it has its exceptions and knowing them allows you to boost companies and be much more efficient without being outside the legal framework. Here we are not talking about assuming aggressive strategies with “measured risk” but about fully complying with labor, tax and social security provisions but knowing every iota of the law.
Fiscal and tax matters become increasingly complex trying to close the door to evasion, contemplating complicated rules that must be understood considering that the authority becomes a factual partner of all companies by having to “share” profits.
González de Araujo has proven to be the steering wheel that takes your company on the right course, helping to implement your vision with certainty and firm steps. Our experience not only in legal aspects but also accounting, are the necessary tool to withstand the onslaught of the market and its regulation, getting ahead in your efforts with the confidence that, while you dedicate yourself to achieving your goals, we deal with the aspects that you do not know but that the authority asks to solve.
Come with us, we offer you the particular design that your business needs, with the confidence of being able to combine your business vision with our experience, solidity and proven success for more than 10 years.
Each dollar must be an investment and not an expense, each dollar must have a return because we know that not only your family, but that of all your collaborators and suppliers, depends on the success of your business. So, if you want to explore the investment possibilities in Mexico, write to us at firstname.lastname@example.org