FIRST-HAND LOOK: Mitchell Wine, Founder of North American Industries
Before getting into the business of helping other companies set up operations in Mexico, Mitchell Wine walked down the road himself. Here, Wine talks about his experiences during his first year of manufacturing in Mexico.
Our first year operating in Juarez, Mexico brought a list of new adventures, experiences, new cultures, desert landscapes/climates and a host of many changes in our company’s business life. Our facility was set up in Juarez, Mexico, just over the border from El Paso, Texas. Juarez is the largest city in Mexico for maquiladora programs.
Maquiladoras are factories that import materials and equipment usually on a duty-free and tariff-free basis for assembly or manufacturing and then re-export the assembled product, usually back to the originating country.
Setting up a plant is not too different than setting up a plant anywhere in Canada. Our landlord finished our facility according to the specifications we provided. The facilities are as good as or better than any I’ve seen in Canada. Most are new and are built with state-of-the-art materials. Our facility was built from scratch with a timeline that never would have been achievable in Canada. I’m still not quite sure how American Industries, our landlord, was able to get it done in the time promised.
A typical work day is from 7 a.m. to 4 p.m., not counting travel time, but days often stretch beyond that as in any facility in Canada. We hired senior management and our plant manager is an American who commutes daily from El Paso. Our maquiladora operator, American Industries, was responsible for finding us suitable candidates for all other positions. The vast majority of Mexican middle management we hired is bilingual (not French and English as we’re used to but Spanish and English) so communicating is not a huge problem.
The education system does not seem to be as strong in Mexico as in Canada but this is compensated by the strong work experience many employees have due to previous jobs with some of the larger companies in the area such as RCA, Delphi Corporation, Scientific Atlanta, Ford Motor Company and General Motors, just to name a few.
As the facilities are often in newer areas and employees don’t have cars, employees are bussed to and from work with a well-organized bus system. In most facilities it is standard to also offer two meals a day to employees, which makes the job a very attractive one. On-site medical care is also provided as required. All facilities have 24HR security with gates and guards.
One is immediately stuck by the work ethic of the people. It is tremendous. Jobs in the maquiladora industry are considered good jobs and employee attitudes towards work are very positive. Turnover rate at the unskilled level can vary since many people come from all over Mexico for jobs and don’t return after holidays but new workers to replace those that don’t return are always available.
One difference that Americans find with Mexico that is not a big deal for Canadians is the issues involved in working through an international border. Dealing with customs and the import/ export of materials can add some delays but nothing greater than any Canadian manufacturer exporting to the U.S. has not experienced before. Everyone involved in customs clearance understands how important it is to the Mexican economy that goods travel efficiently and this is welcome.
One of the nice surprises we experienced in addition to the cost savings on labour was the plentiful supply chain of vendors/ suppliers that is networked locally. With all the manufacturing operations that are based in Mexico, there is not much one cannot find supplied locally at a cheaper price than would be found in Canada. And if it can’t be found in Mexico, it will always be available in El Paso with a metropolitan population of 1 million people and a strong business infrastructure.
Next noteworthy things are the intangibles – things one doesn’t think of when making a decision to open a plant elsewhere. One big (and great) one is the difference in weather. Juarez / El Paso are in the desert. The sun shines every day and the average temperature is never usually below 20 degrees (and can often be above 30 degrees). Fortunately, humidity is not a factor in desert climates.
For those who enjoy the outdoors, the area has activities year round. Golf, hiking, running and swimming are just a few. And for those who miss the Canadian weather, there is some skiing in the winter that is a couple of hours drive away.
Our plant manager lives in El Paso and commutes daily. In my visits to our plant, I have not found the commute to be too bad but I am told that commuting time can vary. Our plant happens to be deep into Juarez, not just over the border as our first plant was. Going into Mexico from the US is very easy. Coming back can be another story. There are four major crossings between El Paso and Juarez. If one times the return visit properly, the border wait can be 20 minutes but it can range higher.
Another great bonus is the people. They are all so generous and selfless. They have always tried to make me feel comfortable and at home. They always talked and tried to practice their English and are so appreciative of any Spanish spoken. The Mexican culture has a strong religious, family-oriented base that contributes to the solid nature of everyone I’ve met.
As with any new business, there will always be hiccups that have not been anticipated. But in looking back at our experience in Mexico, it went about as well as any business venture I’ve worked on in Canada or the U.S. The stereotypes of Mexico do not do it justice and a properly planned expansion in that market should be a positive experience for any Canadian business.
Mitchell Wine is the president of Brushstrokes Fine Art Inc., a Richmond Hill, Ont. His experiences in Mexico led to the creation of North American Industries, a Canadian company that helps businesses set up manufacturing operations in Mexico. Learn more about North American Industries at www.naig.ca, or in the July/August 2007 issue of Canadian Plastics.
