Mexico, the Lowest-Cost International Business Location

Mexico, the Lowest-Cost International Business Location

Cost competitiveness is one of many factors businesses consider when selecting a country to locate in. KPMG recently conducted an analysis of the relative costs of doing business in North America, Europe, and Asia Pacific. The comparison shows Mexico as the lowest-cost option for any company considering an international business location.


 

 

Mexico was the only high growth (emerging) country included in the study, showing an 18.7% cost advantage over the United States in 2014. With little change in the value of the Mexican peso over a four- year period, Mexico's cost advantage relative to the United States has been holding steady.

cost advantage disadvantage relative US 2014

Comparing major industries, Mexico ranks first among the 10 countries in all sectors but sees its greatest cost advantage relative to the U.S. baseline in the Corporate Services subsector, with costs 46% lower than in the United States. Labor costs for both entry-level admin and customer service employees, as well as finance professionals, are significant in this subsector.

 
Labor costs represent the single largest location-sensitive cost factor for all industries examined in KPMG's analysis. For service operations, labor typically represents approximately 75 to 90 percent of total location-sensitive costs. Labor comparisons were based on a mix of 42 job positions, which vary by industry. Labor costs comprise wages and salaries, statutory costs (payroll taxes, government pension plans, medical plans, etc.), and other benefits typically provided by employers. Combining these elements, total labor costs are lowest in Mexico by a wide margin.

Source: KPMG.

At Call Center Services International, we are Specialists In Establishing Contact Centers In Mexico and we provide our clients a lower cost nearshore solution that delivers a talented high-performance workforce with top quality service. Baja California has become the preferred nearshore destination for companies servicing North American markets due to the bilingual and skilled workforce, as well as significant cost-saving business opportunities. Read more about the benefits of establishing a Nearshore Mexican Call Center.