Outsourcing:),

Outsourcing i think is when different countries extend in other states or elsewhere, but i think in mexico its not good because the other countries have more technology and, more things better than mexico. I was reading about outsoucring in mexico, and i found this article more detailed.

Article
Outsourcing has come to imply manufacturing in Asia. But closer to home, outsourced manufacturing is also booming in Mexico. Mexico has long been a location for large-item manufacturing. Automotive and large appliance manufacturers have utilized Mexico plants for decades. In recent years, however, the electronics industry has placed more emphasis on Mexico. Our southern neighbor is close, the Mexican time zones roughly match the United States business day, and there is a growing pool of skilled Mexican engineers to support manufacturing. For high volume, low mix products, Asia is still the first choice for outsourcing. Typically Mexico gets manufacturing projects that include small production runs, big product runs or new products. Microsoft’s Xbox, for instance, was manufactured initially in Mexico before it was shipped to Asia for high-volume production. “Mexico has not gotten into high volume production,” says Beth Ely, SVP of new channel development at Avnet Inc. in Phoenix. “Traditionally, Mexico has produced low volume, high mix products and new product introductions.” Outsourcing in Mexico comes in a couple distinct flavors. The border has long been home to twin plants – or maquiladora plants – that are owned by OEMs. The electronic manufacturing services (EMS) providers tend to congregate around Guadalajara, which has become a growing territory for electronics outsourcing. “Guadalajara is the manufacturing hub for top-tier EMS companies,” says Ely. “That’s the fastest growing area for manufacturing. The border areas have the OEM-owned twin plants and lower-tier EMS companies.” Avnet supplies global EMS companies and North American OEMs that are producing products in Mexico. The distributor also supplies indigenous OEMs that tend to congregate along the border. “We support indigenous Mexican manufacturers along the board as well as EMS providers in Guadalajara,” says Ely. “Much of the product for the border plants comes from our Arizona warehouse, but we also have branches along the border to support Mexican manufacturers.” Avnet also maintains a large warehouse in the Guadalajara area that is designed to serve EMS providers. Proximity to the United States matters Because of its closeness to the United States, Mexico has been a preferred outsourcing location for big products such as autos and big-box appliances. “Automotive has always been big in Mexico, as well a refrigerators and washers because the logistic costs of shipping those items over the ocean is ridiculous,” says Eric Miscoll, senior consultant and COO of Technology Forecasters Inc. in Alameda, Calif. Mexico is also a likely spot to produce new products, since it’s easier for company personnel to pop down to Mexico than it is to travel to Asia. “If the company has just recently started outsourcing, or they have a new product, they will often take it to Mexico because of the proximity,” says Avnet’s Ely. “In Mexico they can be more hands-on and keep it closer to home. Because of that, you see a lot of industrial manufacturing but not much consumer high volume production.” Mexico is handy for outsourcing also because it is roughly in the same time zone as the United States. One of the biggest complaints about outsourcing to Asia is the time difference between North America and Asia. One distribution executive says he doesn’t even give out his business card when traveling to Asia any longer because the late night calls are disruptive. Plus, it helps to be close if there are production problems. “Even Asian companies are now setting up shop in Mexico so they can more effectively serve U.S. customers,” says Miscoll of Technology Forecasters. Another recent development in Mexico that has lured outsourced manufacturing, is the country’s emerging engineering talent. “We’ve seen an increase in the use of engineers in Mexico because the labor rate is low” says Miscoll. “Mexico is doing more design because their engineers are very competent. So it isn’t just cost that’s attractive, it’s also the quality.” Miscoll attributes the quality engineering to the technical universities Mexico has produced in recent years. Avnet’s Ely notes a distinct improvement in Mexican engineering in recent years. “Over the past 10 years, a middle class has evolved in Mexico, and that middle class puts a high emphasis on education as a way to move up the economic ladder,” says Ely. “So a lot of people are coming out of Mexican engineering schools.” She notes that most of the engineering work tends to support manufacturing and industrial production. But she notes there has also been a recent trend toward design engineering. “The design engineering is relatively new, but design centers are getting set up,” says Ely. “That’s part of Mexico’s maturing workforce.”

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