Nearshoring in Latin America & the impact on manufacturing

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Brazil supply chain
Mario Veraldo, CEO of Mexican supply chain company MTM Logix, shares the business opportunities of nearshoring & how Latin America can play a vital role

The pandemic brought great change across business sectors; telehealth rose in the healthcare industry while employees got used to working from home and experimenting with veganism. For the supply chain and manufacturing sector, COVID-19 caused total chaos. Workers recovered from the virus or were forced to isolate themselves, slowing down production levels and delaying transports. This caused manufacturers to review their supply chains and consider nearshoring. 


What is nearshoring and how does it impact manufacturing

Manufacturing activities were offshored to China and across Asia in the 1980s. There. workers were paid lower salaries than the wages paid to employees in the manufacturers native country. 

Now, consumer demand dictates that products should be easier to get hold of in a crisis and ethically made. This has led manufacturers to reconsider their supply chains and bring manufacturing closer to home.

Nearshoring is the opposite of offshoring, when a business moves its manufacturing to a country closer to them - or closer to the consumer. Latin America is an ideal nearshoring location, according to Mario Veraldo. 


Nearshoring can advance business opportunities & extend supply chains

Mario Veraldo is the CEO of MTM Logix, a supply chain solutions company based in Mexico City which specialises in control tower and freight brokerage solutions. 

“We're working to transform the logistics landscape with data-driven insights and solutions that optimise supply chains across various industries,” said Veraldo.

For Veraldo, the Nearshoring wave, particularly in Brazil, is an exciting trend to witness. 

“As a large economy with a robust industrial sector, Brazil is drawing international companies looking to reduce the complexity and risks associated with extended supply chains. Mexico is undoubtedly the winner at this stage due to its proximity to the USA,” he says. “However, since nearshoring is a strategic move that reduces transit times and costs and provides business opportunities, Brazil will surely benefit as bottlenecks in Mexico appear.”

Veraldo says that Latin America plays a vital role in the global supply chain due to its strategic geographical position, abundant resources and growing consumer markets. 

“The region, particularly Mexico, serves as a bridge between North America, Europe, and Asia. This is especially relevant as businesses must drive certainty into their supply chains and build global platforms to serve multiple regions from one central point.”

Over the next 12 months, MTM Logix will expand its operational and commercial footprint further into the United States and markets that are transferring activities towards the United States, Mexico and Brazil. 

“We focus on further enhancing our innovative control tower solutions to deliver more value to our customers. We are also investing in our team's skills and technology to meet the growing demand for high-quality, cost-effective, and reliable logistics services. 

“In addition, we're working towards building strong partnerships with businesses in the regions we operate to connect them to our suite of solutions.” 

This will enable MTM Logix to provide its customers with the tailor made solutions for their supply chain needs, helping them to optimise their financial results.


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