Executive Summary

Nearshoring is an economic trend which consists of relocating business operations to a nearby country or region, often with the intention of reducing costs and improving efficiency. This approach has become increasingly popular in recent years, particularly in the context of e-commerce, as companies seek to gain a competitive edge in a rapidly evolving marketplace.

One of the primary benefits of nearshoring is cost reduction. By moving operations to a nearby country with lower labor and overhead costs, companies can reduce their operational expenses and become more competitive in the marketplace. Additionally, the proximity of the new location can lead to improved efficiency in the supply chain, as shorter delivery times and lower shipping costs allow for better coordination and inventory management.

Another key advantage of nearshoring is the potential to improve the customer experience. With shorter delivery times and lower shipping costs, companies can offer faster and more affordable shipping options, leading to higher customer satisfaction and loyalty. This can be particularly important in the e-commerce industry, where customers expect fast and reliable shipping.

However, there are also potential downsides to nearshoring. For example, the relocation process can be expensive and time-consuming, and there may be challenges associated with cultural and language differences. In addition, there may be concerns about the displacement of local workers in the country of origin, as jobs are moved to the new location.

Despite these challenges, nearshoring has become an increasingly popular strategy for businesses seeking to improve their competitiveness. By carefully weighing the benefits and risks of nearshoring, companies can determine whether this approach is the right choice for their specific needs and goals.

In the context of Mexico, nearshoring has the potential to provide significant economic benefits. For example, if companies relocate operations to Mexico, this can create jobs and economic opportunities for the local community, leading to increased demand for goods and services and stimulating economic growth in the region. Additionally, nearshoring can attract direct foreign investment, which can have positive effects on economic growth and technology transfer to the Mexican economy. It can also improve Mexico's competitiveness in the global market by offering lower labor and production costs than other countries, making it an attractive location for companies to establish operations.

Mexico is a great option for nearshoring for several reasons:

  1. Geographic proximity: Mexico is located in close proximity to the United States, making it easier and more cost-effective to travel between the two countries. This can help facilitate communication and collaboration between teams.
  2. Cultural compatibility: Mexico shares many cultural similarities with the United States, including language, work ethic, and business practices. This makes it easier for companies to work together and reduces the potential for misunderstandings.
  3. Skilled workforce: Mexico has a large and growing pool of skilled workers, particularly in the technology and manufacturing sectors. This means that companies can find the talent they need to succeed in a competitive global market.
  4. Competitive costs: Compared to other countries, Mexico offers a competitive cost structure for nearshoring. Labor costs are generally lower than in the United States, while infrastructure and real estate costs are also relatively affordable.

I. Background


Nearshoring is an economic trend which consists of relocating business operations to a nearby country or region, often with the intention of reducing costs and improving efficiency. This approach has become increasingly popular in recent years, particularly in the context of e-commerce, as companies seek to gain a competitive edge in a rapidly evolving marketplace.


One of the main advantages of nearshoring is the reduced cost of labor compared to domestic operations. By outsourcing to nearby countries, companies can take advantage of lower labor costs while still benefiting from similar time zones, cultural similarities, and easier communication. This can also lead to a reduction in transportation and logistics costs.

Another advantage of nearshoring is the ability to tap into a wider pool of skilled talent. Companies can leverage the expertise and experience of workers in nearby countries, who may have similar language and cultural backgrounds, as well as access to advanced education and training programs.

Nearshoring can also help companies improve their supply chain efficiency, as it reduces the time and costs associated with shipping goods and materials over long distances. This can help to streamline production and reduce lead times, enabling companies to be more responsive


  1. Commercial tensions between China and the United States: In 2018, trade tensions arose between these two countries, resulting in the imposition of tariffs. This has resulted in increased costs of more than US$700 billion.
  2. COVID-19 pandemic: In 2020, the pandemic caused the closure of various borders and supply chain disruption, which interfered with global trade and ultimately resulted in a 10% annual drop in trade flows.
  3. War between Russia and Ukraine: As a result of Russia's invasion of Ukraine, some trade routes were changed and, therefore, so were costs. The prices of raw materials such as oil and wheat were affected.


  1. Cost savings: One of the primary drivers of nearshoring is the ability to reduce labor costs while still maintaining a close proximity to operations. Companies can take advantage of lower wages in nearby countries, as well as reduced transportation and logistics costs.
  2. Access to talent: Nearshoring allows companies to tap into a wider pool of skilled talent in nearby countries. This can be particularly important for companies that require specialized skills or expertise that may not be readily available in their home country.
  3. Time zone proximity: Nearshoring to nearby countries can allow companies to operate in similar time zones, which can help to improve communication and collaboration with suppliers, partners, and customers. The difference in time zones has always been a significant issue with offshoring. In today's environment, managing a three-hour maximum time difference, including less travelling time and good connectivity between countries, seems more attractive.
  4. Cultural and language similarities: Nearshoring to nearby countries can also help to reduce cultural and language barriers, as there may be greater similarities in language, customs, and business practices.

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