Nearshoring as defined by Wikipedia is: “the transfer of business or IT processes to companies in a nearby country, often sharing a border with your own country”, where both parties expect to benefit from one or more of the following dimensions of proximity: geographic, temporal (time zone), cultural, linguistic, economic, political, or historical linkages. The service work that is being sourced may be a business process or software development.
Businesses take advantage of “Nearshoring” by offering customers the same quality, reliability, service, local culture and communications found in the originating country by using the labor force in the lower cost region. You can either partner with a local firm or invest and develop the infrastructure yourself. Either way it is a long term investment and obligation. And make no mistake, the primary reason companies relocate “Labor Intensive” processes is to reduce cost and in turn pass these savings on to their customers. It is all about competition and to provide the consumer of the product or service with a comparable alternative at a lower price.
AMCOR started “Nearshoring” in Mexico in 2006. Our goal was to provide the same quality, service and reliability that our customers came to expect from our USA operations. We invested heavily in technology, local management, technical personnel, infrastructure, and quality systems to insure the start up program would be successful. Each year we added more services to our Juarez Repair Center and our El Paso Distribution Center to meet additional customer requirements. In August of 2013, AMCOR completed the operations transition. Today, all repairs are completed in Juarez and distribution except for interior Mexico is handled in El Paso. Everyday freight is received in El Paso and sent to our Juarez repair site. The carrier will then return the completed repair to El Paso for distribution. All management, customer service and administration functions have remained in New Jersey.
Our company has been able to broaden our service offerings since the advent of our “Nearshoring” program. Our new cost structure allows us to offer repair services for consumer products as well as traditional IT products. We could not compete in the consumer market prior to our move to Juarez.
Ask yourself these questions:
- Do you have problems finding repair vendors able to provide quality, service and competitive pricing to meet your business model today?
- Do you make items unrepairable because it is not economically sound to repair with your current vendors?
- Are you paying more than necessary because of perceived differences in quality, reliability and service?
If you answer YES to any of the above, then you should consider “Nearshoring” to gain advantage over your competition, grow your company and add to your bottom line.