Shelter History in Mexico

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This Entrada Group (www.entradagroup.com) presentation charts the evolution and advantages of shelter services in Mexico, which have been developed to help manufacturers serve key markets in North America.

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Shelter History in Mexico

  1. 1. <ul><li>Leveraging Cost Reductions in Labor, Supply Chain and Administrative Overhead </li></ul>Doug Donahue V.P. of Business Development The Entrada Group
  2. 2. <ul><li>Introduction to Mexico Shelter Operations </li></ul><ul><li>The Evolution of Mexico Shelters </li></ul><ul><li>Types of Shelters </li></ul><ul><li>Choosing a Shelter </li></ul>
  3. 4. <ul><ul><ul><li>A turn-key solution to access a cost-effective labor force </li></ul></ul></ul> Introduction to Mexico Shelter Operations
  4. 5. <ul><ul><ul><li>Across-the-board, cost-cutting solution </li></ul></ul></ul><ul><ul><ul><ul><li>Administrative overhead </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Supply chain </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Labor </li></ul></ul></ul></ul> Introduction to Mexico Shelter Operations
  5. 6. <ul><ul><li>A solid competitive advantage </li></ul></ul><ul><ul><li>Lower labor costs </li></ul></ul><ul><ul><li>~The Boston Consulting Group </li></ul></ul><ul><ul><li>+ </li></ul></ul><ul><ul><li>Lower capital investment costs </li></ul></ul><ul><ul><li>Large ecomomies of scale </li></ul></ul> Introduction to Mexico Shelter Operations <ul><ul><li>+ </li></ul></ul><ul><ul><li>Lower domestic sourcing costs </li></ul></ul><ul><ul><li>+ </li></ul></ul>
  6. 8. <ul><li>Simple Concept: Shelters provided assistance in establishing and managing administrative services </li></ul> Mexico Shelters: An Evolution in Services
  7. 9. Shelter Operator’s legal entity on behalf of Manufacturer International Manufacturer Manufacturer’s legal entity sub- contracting Shelter Operator services SHELTER SERVICES EVOLUTION: PHASE 1  Mexico Shelters: An Evolution in Services
  8. 10. SHELTER SERVICES EVOLUTION: PHASE 1 Shelter Operator Responsibilties: - compliance with all Mexican regulations - answering to Mexican authorities Shelter Operator’s legal entity on behalf of Manufacturer International Manufacturer  Mexico Shelters: An Evolution in Services
  9. 11. International Manufacturer Mexican system SHELTER SERVICES EVOLUTION: PHASE 1  Mexico Shelters: An Evolution in Services
  10. 12. Single Cost Advantage: Reduced Labor SHELTER SERVICES EVOLUTION: PHASE 1 Shelter Operator’s legal entity on behalf of Manufacturer International Manufacturer UPSIDE  Mexico Shelters: An Evolution in Services
  11. 13. SHELTER SERVICES EVOLUTION: PHASE 1 Shelter Operator’s legal entity on behalf of Manufacturer International Manufacturer DOWNSIDE Higher costs for supply & delivery chains, and administrative expenditures  Mexico Shelters: An Evolution in Services
  12. 14. SHELTER SERVICES EVOLUTION: PHASE 1  Mexico Shelters: An Evolution in Services
  13. 15. SHELTER SERVICES EVOLUTION: PHASE 2  Mexico Shelters: An Evolution in Services
  14. 16. Leveraging economies of scale SHELTER SERVICES EVOLUTION: PHASE 2  Mexico Shelters: An Evolution in Services $ $ $
  15. 17. SHELTER SERVICES EVOLUTION: PHASE 2 External Supply Chains Mexico Shelter  Mexico Shelters: An Evolution in Services $ $ $
  16. 18. SHELTER SERVICES EVOLUTION: PHASE 2  Mexico Shelters: An Evolution in Services Working with domestic suppliers $ $ $
  17. 19. SHELTER SERVICES EVOLUTION: PHASE 2 Establishing Supplier Shelters Shelter Provider “ Matchmaking” Suppliers to OEMs  Mexico Shelters: An Evolution in Services
  18. 20. SHELTER SERVICES EVOLUTION: PHASE 3 Sheltered Manufacturers and Supply Chains share Freight, Security, Administration and Maintenance  Mexico Shelters: An Evolution in Services
  19. 21. SHELTER SERVICES EVOLUTION: PHASE 3  Mexico Shelters: An Evolution in Services Leveraging: - Talent - Resources - Costs
  20. 23.  Types of Shelters
  21. 24. <ul><li>Turns over complete management and legal control after set-up </li></ul><ul><li>Short to medium-term contract </li></ul><ul><li>Assists in site selection, logistics, legal requirements, facilities licensing and perhaps initial selection of key Mexican personnel </li></ul><ul><li>Cost saving benefits minimal </li></ul>The up and running shelter  Types of Shelters
  22. 25. <ul><li>Assists in initial start up </li></ul><ul><li>Provides a facility, under lease </li></ul><ul><li>Offers a dministration and management: human resources, payroll, accounting services, facilities management, procurement </li></ul><ul><li>3PL services: including warehousing, logistics, order processing & transportation management </li></ul><ul><li>Shelter office nearby, cross town or hundreds of miles away </li></ul><ul><li>Decentralized functions; unable to optimally leverage economies of scale. </li></ul>Continuous Support Shelter  Types of Shelters
  23. 26. <ul><li>Handles support while clients maintain corporate identity and control the manufacturing process </li></ul><ul><li>Several clients in a single industrial park, owned by shelter </li></ul><ul><li>Start-up fast and affordable but still tailored </li></ul><ul><li>Clients share costs: freight, security, administration and maintenance. </li></ul><ul><li>Providing BPO services to clients outside the industrial park </li></ul><ul><li>Centralized administration leverages economies of scale to reduce costs. </li></ul>Full-Service Shelter  Types of Shelters
  24. 28. <ul><li>Inventory your needs and ensure that your shelter provider can competently address all your requirements </li></ul><ul><li>Ask your shelter provider to: </li></ul><ul><ul><li>Demonstrate their ability to reduce your total per-unit cost </li></ul></ul><ul><ul><li>Show you through metrics how they are accomplishing economies of scale </li></ul></ul><ul><ul><li>Show cost savings across the board in labor, supply chain costs and administrative overhead </li></ul></ul> Choosing a Shelter
  25. 29.  Choosing a Shelter

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