Key reasons to start outsourcing to Mexico

21st Jul 2022

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Mexico offers many competitive advantages when it comes to outsourcing software development compare to other destinations like India or Eastern Europe, that have been in under the magnifying glass of this industry for the last 50 years. Even though, it has been around since the 1980s, adopting NAFTA and the resulting globalization boom, have continued to highlight these advantages. Among others, these include: time zone similarities, cultural and linguistic compatibility, high-performance software engineers and competitive labor costs. An excellent working relationship between federal and state governments doesn’t hurt, either.

In order to understand the many benefits of nearshoring software development to Mexico we need to take a look back at how outsourcing works, and how it has evolved over a relatively short period of time. Even though outsourcing has been around since the mid 20th century, it became a part of our lexicon around the 1990s. During this time, the outsourcing model switched from non-core activities to “strategic business processes.” This workability impact directly on business performance, which main purposes is to gain a competitive advantage by utilizing external resources to enhance and maximize internal capabilities and processes.

From the early 2000s until today, outsourcing has looked to take advantage of new technologies and new infrastructure to deliver innovation and revolutionize traditional business models. Nowadays, outsourcing isn’t just moving operations to a different country with the objective to reduce costs and improve profits; it has evolved more towards the development of strategic partnerships, where both parties are readily invested in long-term operational success, not just temporary relief.

In the particular case of outsourcing to Mexico, in the past 10-15 years, there has been a great influx of companies that outsource customer service and billing operations to this country. Lately, organizations from all over the world look to outsource different aspects of their business operations, particularly outsourcing software development. The strong labor force, competitive wages, a youthful and dynamic population itching to find good jobs (that includes competitive salary and growth opportunities), and the willingness to learn are some of the added benefits that these companies have discovered when looking for the right place to develop their nearshore operations. Intangibles such as strong family values, a solid work ethic, and the desire for continuous improvement are also added to the mix. Many Mexicans are also looking for new and exciting opportunities to work with companies from all over the world, without having to uproot and leave Mexico.

Globalization has ushered in new ways for companies to do business abroad. Affordable, broadband, high-speed internet infrastructure has made it that much easier. Flexibility along nations’ borders, physical and otherwise, has made international business ventures the norm. American companies have been able to adapt to the newest work dynamics learning and lean on countries like Mexico when it comes to increasing workforce with high-performance and qualified experts that also have a real understanding of how business take over in America, plus Mexicans have a shorten cultural barrier and high English understanding.

Nowadays, companies are outsourcing specialized operations that require highly skilled workers, who can speak the language but that are also culturally sensitive. Mexican higher education institutions have taken notice of this and are offering specialized degrees and courses to adequately prepare students to became the professionals these emerging job markets need.

There have been some changes in Mexico’s labor laws that may appear dissuasive at first glance. It is an attempt from Mexico’s leftist federal government to reform labor laws which for many years have been terribly unfair and abusive for employees, and have served to seemingly line the pockets of a particular sector. It is part of the Mexican government’s attempt to keep its promise at eradicating systemic corruption that has long been a shameful and infective part of the country’s social and political fabric. However, this should not be in any way a hindrance or obstacle for companies looking to outsource to Mexico. Companies constituted in Mexico and operating in the country are well aware of the legal changes and have ample experience in navigating the murky waters of government bureaucracy. The advantages of outsourcing operations to Mexico from the United States far outweigh the negatives.

Here are some of the main benefits of outsourcing to Mexico:

  • The technological market in Mexico has been growing at a consistent rate for several number ears. Government programs and universities see that a technologically skilled workforce is essential to face new challenges in the modern world.
  • Mexico has been producing STEM graduates at a high rate, and modern cities like Guadalajara and Monterrey support the quadruple helix initiative, where college graduates are equipped with necessary high impact skills to thrive in the IT industry.
  • Mexico shares multiple time zones with the United States, which has long been a criticism when offshoring to countries in Asia or Europe. Even in areas where the time zones don’t overlap, the biggest difference is still a manageable two or three hours. There is no need to stay up late or wake up before dawn to attend meetings, deadlines are easier to meet, and delays can be more easily avoided. This also facilitates constant communication with your team increasing productivity.
  • There is a cultural affinity between Mexico and the United States. This allows for more cohesive communication. In Mexico, most students start learning English as a second language from a very young age, even in public schools. This further weakens cultural and language barriers, and provides for more cultural awareness.
  • Strong business relations between the United States and Mexico have existed for many years. Since NAFTA, both countries have worked to ensure that business practices between the two nations run smoothly, even as political changes have threatened this harmonious pairing.
  • Trade agreements between the United States and Mexico ensure intellectual property protection, which can be an issue. Companies can share technological software development information freely and worry-free.
  • Mexico has improved infrastructure in major cities and specific regions in the country to address demands of a growing market as the ones of its own population to become a more dynamic and modernized country.
  • Mexico has a dynamic, hungry, and highly trainable workforce in waiting. College students are being provided with opportunities to excel in areas that are in demand around the world, primarily in technological, engineering, and software development skills.
  • The Mexican government has implemented programs throughout the country and is creating exciting new infrastructure to meet these needs. Much like the manufacturing and industry boom of the late 20th century, IT and software development are now an important driving force in the country’s economy. Commercial and economic partnership with major United States companies have opened up new avenues for young professionals, continuing to trend forwards and upwards.

Companies from the United States and elsewhere will find no better ally than their partners in Mexico. Mexican companies are more than capable of handling every local challenge with professionalism working forward to maintain the quality of the service and ensure that joint ventures like these have every opportunity available to be successful and broaden that bottom line. The results speak for themselves.


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