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Selling to Mexico

Insights, challenges, and opportunities for the third-largest export market
Selling To Mexico

Liens involving real estate or pledges of certain assets or crops must be filed and recorded before the Registro Uico de Garantias (Secure Guaranties Registry), Colter-Carswell says. Other alternatives include selecting buyers with membership in the Fruit and Vegetable Dispute Resolu-tion Corporation (DRC) or Blue Book Services if things go wrong, but, as he points out, “the creditor will have to execute his final resolution in Mexico through Letters Rogatory [a formal request for action from the courts of one nation to another]. It’s very important to have guaranties from Mexican buyers.”

“Sell to buyers who pay their bills using the same due diligence tools you already use in the United States,” Hanemann says. “Diversify your customer base, just as you do in the United States, don’t put more than 20 percent of your business in Mexico into the hands of any single importer.

“Monitor market conditions from as many different sources as possible, and make sure reports from your buyers reflect what you know to be true from these other sources,” Hanemann says, and also recommends setting and sticking to payment terms, “usually 21 to 28 days from date of shipment—and hold firm. Any slippage requires a response in terms of limiting subsequent volumes. Require DRC membership on the part of your buyer. If necessary, subsidize the buyer’s membership fee yourself; it will be far less expensive than credit insurance. Then become a DRC member yourself.”

While the export process can be fraught with difficulties, following a few simple caveats can go a long way. “You need to choose your friends wisely, business is no different,” Goforth asserts.

“The key is to do business with customers you respect and who will respect your business. It should be a partnership built on fairness and transparency. Of course,” Goforth adds, “at the end of the day, there are bad people everywhere. You just have to choose what team you want to be on, do your best to be who you say you’re going to be, and good business will follow.” He sums it up this way: “With the right product and the right partnership, I see nothing but growth.”

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Dan Alaimo is a writer/editor specializing in the supply chain, technology, and marketing of food and related products.