THE MILLION-DOLAR PRICE OF CROSSING THE BORDER

Logistics in Mexico is facing increasing challenges influenced by geopolitical tensions, new trade regulations and growing instability in international trade.

The imposition of new tariffs, more rigorous inspections at border crossings, an insufficient customs infrastructure in relation to demand, and the increased in insecurity along federal highways have led to unexpected delays in the logistics sector regarding the arrival of goods.

Mexico continues to be the main trading partner of the United State. However, today the biggest challenge in logistics is uncertainty. Despite changes incross-border logistics, the trade relationship between the two countries remains strong, it is not easy to return industrial plants and supply chains to their country of origin, especially when it is still geographically advantageous to remain in Mexican territory.

More rigorous inspections of both, drivers and merchandise, are the result of the immigration policy aimed at curbing the flow of fentanyl to the United States. It has been proven that these new practices and inspections have not reduced the illegal trafficking of the substance. However, they have caused longer waiting times in the crossing of goods due to the congestion that occurs atcustoms, especially at the railroad crossing.

Nuevo Laredo, Ciudad Juárez, and Tijuana continue to be the land ports with thehighest flow of trucks and containers in cross-border cargo between Mexico and the United States.

Intervention proposals

We cannot stop the volatile environment we are living in, it is about companies being resilient to the changes that are occurring in terms of changing trade policies that affect cross-border logistics, without neglecting the expectations of customers and market pressure.

One improvement proposal for companies is the integration of systems, those tools that will allow immediate communication between all actors in the supply chain: logistics, production and customs agents.

To respond with agility to change, some of the technologies that companies have adopted and maintained their success are as follows:

· TMS (Transportation Management Systems) to optimize routes and monitor shipments.

· WMS (Warehouse Management Systems) to improve operational efficiency in warehouses.

· Real-time traceability and visibility systems, essential in the face of customs delays.

Working together with the rest of the chain and adaptability to changes are activities that become unpredictable in order to maintain a competitive advantage in the market.

Due to the constant geopolitical changes, it is imperative to analyze the challenges presented by cross-border logistics to bet on those technological changes that allow companies to remain agile and informed, since tariff changes can occur from one day to the next.

Having clarity in planning what problem you are looking to attack or what are the areas for improvement, will allow companies to anticipate and face logistical challenges.