Mexico is a beautiful country and our bordering neighbor. The United States takes full advantage of their warm climate and beautiful beaches, with 80% of tourists coming from the United States. Americans account for a large portion of their tourism revenue, but what about businesses? Both foreign direct investments and tourism have decreased due to the increased violence in Mexico. Many U.S. companies will no longer consider investment plans in Mexico, and some are even moving out of Mexico due to safety issues.
Mexico currently may not look like the best place for a new investment. There has
been a constant battle between drug traffickers and the army resulting in kidnapping, extortion and murder. If you are looking to newly invest in Mexico, I would say to wait until some peace and order is restored. This being said, you may already be doing business in Mexico, or looking to do business but not set up a new factory. If so, you need to know a few things about Mexico before you go.
The official language of Mexico is Spanish, yet the majority of business people do speak English. It would still be polite to learn some Spanish phrases if you don’t
already know some. One word you should remember is compadre, which means friend. Mexicans, similar to the rest of Latin America, will not do business with you until you have developed a trusting relationship. Expect to be taken to lunch, shown around the city or lengthy conversations about your family and interests. Business is conducted through connections between family and friends. Do not rush the relationship building process because they will not do business with you if you seem untrustworthy.
Family is the most important thing in Mexico’s culture, not only their immediate family, but their extended family as well. Everything they do is centered around the family. The father is generally the head of the family, following a strict hierarchal society. Do not underestimate the power of status, because it is very important to business leaders. Make sure to send an executive to the initial meeting, but after that an executive is preferred but not necessary.
The Mexican culture follows a work to live mentality, rather than live to work. Don’t be surprised when people are thirty minutes late for meetings, though you should always arrive on time. Likewise, don’t rush negotiations, they will happen, just at a slower pace than in the U.S.
Mexico is a viable place to conduct business, just make sure to do your homework before you go there. Be aware of the drug cartels and the violence issues they are currently having. Mexico is ranked 100 out of 183 (1 being the best) on the Corruption Perceptions Index. Understand what this means if you do conduct business there, and be aware of the society. See for yourself what Mexico has to offer your business. Would you consider going there?