Market entry strategy for exports to Mexico

If Mexico is a relatively unknown market for you, you need a clear market entry strategy. This may be different from the strategies you have used so far, as the market structure and the competition is different.

Key in your market entry strategy is some market research. Of course there are reports on market size and market growth, but often these are general. Specific knowledge on how your product is perceived and what your competitions is, is harder to get but more valuable.

Oppportunities for international business in Mexico

Mexico, strategically placed between the USA and South-America, has a population of around 126 million as of 2023. The country is known for its rich cultural heritage, blending indigenous and Spanish influences, and natural attractions like beaches and ancient Mayan ruins.

Mexico’s economy, with a GDP per capita of about $9,800 USD in 2023, is characterized by its manufacturing and export-oriented industries. The country is a major producer of automobiles, electronics, and textiles, largely due to its proximity to the United States. Agriculture and tourism are also important, with Mexico being one of the most visited countries globally.

Major cities include Mexico City, the capital and largest city with significant cultural and historical importance; Guadalajara, known for its tech industry and cultural festivals; Monterrey, an industrial and business hub; Puebla, rich in colonial architecture; and Cancún, a world-renowned tourist destination.

Five ways into a market

Your entry model decides your cost, your speed and how much control you keep: sell directly from home, work with an agent, appoint a distributor or importer, sell online, or open a local office.

Control and investment move together. Direct and online selling are cheap to start and easy to stop. A local office gives full control, but needs staff, registration and often a local company.

Most companies start light, prove that there is demand, and only then invest.

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Entering the market in Mexico in three steps

Step 1

Validate the demand

Check market size, competitors and price levels, then speak with five to ten potential buyers. Their reaction tells you more than a general market report.

Step 2

Choose channel and price

Pick the entry model that fits your margin and your capacity, and calculate your landed cost: transport, duties, VAT and the margin the channel will take.

Step 3

Pilot, then scale

Start in one region or with one partner, agree what success looks like after six to twelve months, and expand the country plan only on those results.