Carlos Diaz, a professor and businessman, presented on doing business in Mexico. He discussed the Mexican market highlights including a population of 115 million and GDP of $1.1 trillion. He compared Mexico City to San Antonio and Texas. Diaz then covered products available, pricing, distribution schemes, advertising, cultural aspects, and tips for doing business in Mexico such as finding a local partner and being patient.

1. Doing Business in Mexico
Special Presentation by
Carlos Diaz, Professor at
CIW-México City
November 9, 2012

2. Doing Business in Mexico
• Brief introduction of presenter
• Mexican Market Highlights
• Products and services available
• Pricing comments
• Distribution schemes
• Advertising and Promotions
• Cultural aspects
• Simple tips about Doing Business in Mexico
• Q&A

3. Brief introduction of Carlos Diaz
• Attended Eagle Pass High School, BSEE from The
University of Texas at Austin
• Worked mostly in Multinationals like IBM, Xerox,
Honeywell, Duracell.
• Started two companies of his own,
– Distributor of Home Appliances and
– Managerial Seminars for Austin-based company
• Part-time professor here and another University,
teaching Marketing and Business subjects

4. Mexican Market Highlights
• Total country population: 115 million
• GDP: 1,155 trillion US
• GNI per capita: $9,240 US
• Life expectancy 77 years
• How do they compare to US, and what about
Mexico City by itself versus…San Antonio, and
Texas?

5. indicator Mexico USA Mexico San Texas
Mexican Market Highlights
Country Country City (DF-
metro)
Antonio
Population 115/ 313/ 9-22/ 1.4/ 22.8/
• Total
in
millions/Ar
country9,100 1.4
1,943 population: 115 million
0.742 420
• GDP: 1,155 trillion US
ea 000’s sq
km
• GNI 8.5/ USA AND MEXICO,
Mean yrs ofper capita: $9,240 US
12.4/
life expect.expectancy 77 years BY SIDE
SIDE
schooling/
77 78.5
• Life
GDP In 1,032 15,094 -- -- --
• How do they compare to US, and what about
million US
Mexico City by itself versus…San Antonio, and
GNITexas?
per $9,240 $48,450
capita in US

6. indicator Mexico USA Mexico San Texas
Mexican Market Highlights
Country Country City (DF-
metro)
Antonio
Population 115/ 313/ 9-22/ 1.4/ 22.8/
• Total
in
millions/Ar
country9,100 1.4
1,943 population: 115 million
0.742 420
• GDP: 1,155 trillion US
ea 000’s sq
km
• GNI 8.5/ MEXICO CITY, SAN ANTONIO
Mean yrs ofper capita: $9,240 US
12.4/
schooling/
77 78.5 AND TEXAS, SIDE BY SIDE
• Life
life expect.expectancy 77 years
GDP In 1,032 15,094 -- -- --
• How do they compare to US, and what about
million US
Mexico City by itself versus…San Antonio, and
GNITexas?
per $9,240 $48,450
capita in US

7. Products and services available
• In big cities like Mexico City, Guadalajara,
Monterrey, almost all available, like in US
• Food, medicines, automobiles, computers,
phones….
– Maybe few days/weeks/months after US
• Less variety, or different presentations
• Few niches still available for US products or
services, mostly technological, services

8. Pricing comments
• Most products and services are somewhat more
expensive than US
• Cheaper than US: public transportation, public
schools, taxis, haircuts, fresh produce, fruits
• Big Mac in US $4.20, $2.70 in Mexico
• 16% VAT in most products and services
• 25% income tax
• Minimum salary:
– Mexico $4.80 per day,
– USA $7.25 per hour

9. Distribution schemes
• Wal-Mart is biggest retailer (and employer)
with 210,000 employees and 1,500 outlets
• Plenty of competition from other super
markets, department
stores, malls, convenience stores and
‘changarros’ (mom-and-pop small stores in
most neighbors)
• Sears/Mexico is owned by Carlos Slim, one of
the richest men in the world (Telmex, America
Movil, Sanborns, etc)

10. Advertising and Promotions
• Heavy TV advertising in soap operas, news
• Newspaper circulation very low, print ditto
• Exterior ads growing, specially in urban
areas, bus stops (and buses), metro stations
• Heavy promotion action for consumer goods
in supermarkets, malls
• Many small companies doing promotional
actions for P&G, Colgate, Kellogg's in SM

11. Cultural aspects
• Mexico is similar but different from USA
• Young population influenced by US in clothes,
music, movies, life-style, wants, needs
– With much less disposable income
• Adult population also, travels to US often, uses
internet to buy products & services cheaper
• Senior citizen group growing, aging similar to US,
needing special products and services
• Several Mexicos: urban & country, employees &
self-employed, private industries & governments

12. Simple tips about Doing Business in Mexico
- If you are planning to do business here, live here before you do
- Learn Spanish, read a Mexican newspaper every day
- Know the people, the lay of the land, the customs, the traditions
- Look for unmet needs, wants, desires, dreams, and plan
accordingly
- Find a local partner whom you can trust and join forces
- Start small, think big
- Do not expect to make big (or any) profit the first year
- Be patient and persistent
- Accept the slow way we do business here, do not lose your
temper
- Enjoy your stay, your work, your neighborhood, your amigos,
and

13. Simple tips about Doing Business in Mexico
- If you are planning to do business here, live here before you do
- Learn Spanish, read a Mexican newspaper every day
- Know the people, the lay of the land, the customs, the traditions
- Look for unmet needs, wants, desires, dreams, and plan
accordingly
- Find a local partner whom you can trust and join forces
- Start small, think big
- Do not expect to make big (or any) profit the first year
- Be patient and persistent
- Accept the slow way we do business here, do not lose your
temper
- Enjoy your stay, your work, your neighborhood, your amigos,
and