Doing business in mexico1
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Carlos Diaz, a professor and businessman, presented on doing business in Mexico. He discussed the Mexican market highlights including a population of 115 million and GDP of $1.1 trillion. He compared Mexico City to San Antonio and Texas. Diaz then covered products available, pricing, distribution schemes, advertising, cultural aspects, and tips for doing business in Mexico such as finding a local partner and being patient.
Doing business in mexico1
- 1. Doing Business in Mexico Special Presentation by Carlos Diaz, Professor at CIW-México City November 9, 2012
- 2. Doing Business in Mexico • Brief introduction of presenter • Mexican Market Highlights • Products and services available • Pricing comments • Distribution schemes • Advertising and Promotions • Cultural aspects • Simple tips about Doing Business in Mexico • Q&A
- 3. Brief introduction of Carlos Diaz • Attended Eagle Pass High School, BSEE from The University of Texas at Austin • Worked mostly in Multinationals like IBM, Xerox, Honeywell, Duracell. • Started two companies of his own, – Distributor of Home Appliances and – Managerial Seminars for Austin-based company • Part-time professor here and another University, teaching Marketing and Business subjects
- 4. Mexican Market Highlights • Total country population: 115 million • GDP: 1,155 trillion US • GNI per capita: $9,240 US • Life expectancy 77 years • How do they compare to US, and what about Mexico City by itself versus…San Antonio, and Texas?
- 5. indicator Mexico USA Mexico San Texas Mexican Market Highlights Country Country City (DF- metro) Antonio Population 115/ 313/ 9-22/ 1.4/ 22.8/ • Total in millions/Ar country9,100 1.4 1,943 population: 115 million 0.742 420 • GDP: 1,155 trillion US ea 000’s sq km • GNI 8.5/ USA AND MEXICO, Mean yrs ofper capita: $9,240 US 12.4/ life expect.expectancy 77 years BY SIDE SIDE schooling/ 77 78.5 • Life GDP In 1,032 15,094 -- -- -- • How do they compare to US, and what about million US Mexico City by itself versus…San Antonio, and GNITexas? per $9,240 $48,450 capita in US
- 6. indicator Mexico USA Mexico San Texas Mexican Market Highlights Country Country City (DF- metro) Antonio Population 115/ 313/ 9-22/ 1.4/ 22.8/ • Total in millions/Ar country9,100 1.4 1,943 population: 115 million 0.742 420 • GDP: 1,155 trillion US ea 000’s sq km • GNI 8.5/ MEXICO CITY, SAN ANTONIO Mean yrs ofper capita: $9,240 US 12.4/ schooling/ 77 78.5 AND TEXAS, SIDE BY SIDE • Life life expect.expectancy 77 years GDP In 1,032 15,094 -- -- -- • How do they compare to US, and what about million US Mexico City by itself versus…San Antonio, and GNITexas? per $9,240 $48,450 capita in US
- 7. Products and services available • In big cities like Mexico City, Guadalajara, Monterrey, almost all available, like in US • Food, medicines, automobiles, computers, phones…. – Maybe few days/weeks/months after US • Less variety, or different presentations • Few niches still available for US products or services, mostly technological, services
- 8. Pricing comments • Most products and services are somewhat more expensive than US • Cheaper than US: public transportation, public schools, taxis, haircuts, fresh produce, fruits • Big Mac in US $4.20, $2.70 in Mexico • 16% VAT in most products and services • 25% income tax • Minimum salary: – Mexico $4.80 per day, – USA $7.25 per hour
- 9. Distribution schemes • Wal-Mart is biggest retailer (and employer) with 210,000 employees and 1,500 outlets • Plenty of competition from other super markets, department stores, malls, convenience stores and ‘changarros’ (mom-and-pop small stores in most neighbors) • Sears/Mexico is owned by Carlos Slim, one of the richest men in the world (Telmex, America Movil, Sanborns, etc)
- 10. Advertising and Promotions • Heavy TV advertising in soap operas, news • Newspaper circulation very low, print ditto • Exterior ads growing, specially in urban areas, bus stops (and buses), metro stations • Heavy promotion action for consumer goods in supermarkets, malls • Many small companies doing promotional actions for P&G, Colgate, Kellogg's in SM
- 11. Cultural aspects • Mexico is similar but different from USA • Young population influenced by US in clothes, music, movies, life-style, wants, needs – With much less disposable income • Adult population also, travels to US often, uses internet to buy products & services cheaper • Senior citizen group growing, aging similar to US, needing special products and services • Several Mexicos: urban & country, employees & self-employed, private industries & governments
- 12. Simple tips about Doing Business in Mexico - If you are planning to do business here, live here before you do - Learn Spanish, read a Mexican newspaper every day - Know the people, the lay of the land, the customs, the traditions - Look for unmet needs, wants, desires, dreams, and plan accordingly - Find a local partner whom you can trust and join forces - Start small, think big - Do not expect to make big (or any) profit the first year - Be patient and persistent - Accept the slow way we do business here, do not lose your temper - Enjoy your stay, your work, your neighborhood, your amigos, and
- 13. Simple tips about Doing Business in Mexico - If you are planning to do business here, live here before you do - Learn Spanish, read a Mexican newspaper every day - Know the people, the lay of the land, the customs, the traditions - Look for unmet needs, wants, desires, dreams, and plan accordingly - Find a local partner whom you can trust and join forces - Start small, think big - Do not expect to make big (or any) profit the first year - Be patient and persistent - Accept the slow way we do business here, do not lose your temper - Enjoy your stay, your work, your neighborhood, your amigos, and