When to Use a Shelter Service?
When you’re considering the very exciting option of expanding your business internationally or the bigger undertaking of relocating your manufacturing operations into Mexico, there are an array of options and many competitive advantages for companies looking to remain viable and in a positive position. Reducing time and costs by exploring utilizing shelter operations is a popular choice to try out before completely committing to the strategy of offshoring any part of the business. Shelter services in Mexico offer customized, streamlined unique advantages and opportunities for companies to utilize a special program and hold off or permanently delay establishing themselves as a foreign subsidiary, which can be a standard operating procedure in many developed or developing countries. Experiencing the benefits of shelter services, as well as NAFTA’s bilateral trade agreements, ultimately reduce both time and costs for a company wishing to expand into Mexico.
Many companies opt to expand their business and operations into Mexico under a shelter service, which means they operate under a Mexican corporation owned by the shelter service provider. By having no established legal presence in Mexico, companies can negate any liability associated with doing business in Mexico, while still benefiting from all government tax and duty programs, which can greatly reduce tax and duty obligations and costs associated with having a formalized and legal entity in the country.
There are a number of advantages of operating under a shelter corporation such as no legal liability within Mexico, reduced labor costs, benefits of economies of scale, labor flexibility, faster time to market, certification paths, and more. While operating under a shelter corporation does not exclude any company from having its own name, facility, or corporate culture in Mexico. Clients operate within their own facilities, implement their own processes and procedures and sets the culture of their factory, just the same as if they were operating under a standard and traditionally owned model. Shelter service providers are in business to provide guidance and compliance management support without interfering in other areas of the operation, including quality of production.
Consider the option of utilizing a shelter service and Shelter Company when moving any part of your business into Mexico might be the safest, smartest and most cost-effective strategy, in order to reduce liabilities and receive guidance from experienced and specialized service providers that have done these hundreds of times before for other clients and companies. Relying on the years of experience of those that have more expertise in an area where you lack, is one of the greatest benefits of having a professional network and utilizing resources well in the world of business. Learning from others, and going along with their well-established playbook of what to do, and what not to do, in order to be successful can be what makes your company’s next phase a wild success for all involved.