Expanding into Mexico offers a dual advantage: access to an additional North American talent pool and an entryway into the Latin American market. However, the approach you take can make or break your success.
While hiring a Country Manager remotely might seem like an intuitive first step, companies often underestimate Mexico’s complexity, which requires a more comprehensive approach.
Here’s what experienced organizations recommend prioritizing, along with pitfalls to avoid:
Minimize surprises
Surprises in a new market are costly and time-consuming. Instead of coordinating multiple vendors—such as a headhunting agency, Employer of Record (EOR) firm, tax advisor, facilities/location consultants, international accounting firm, and more, try to hire one end-to-end vendor. It reduces overhead expenses and is more effective in preventing costly surprises. A firm focused on just one area will not have the 360-degree view of a Soft-landing vendor, which will have a more complete understanding of the full effects of a decision.
Soft-landing options are common in countries with strategic locations, reducing entry risks and setup costs for foreign companies while lowering total expenses. These end-to-end vendors streamline operations, covering legal compliance, recruiting, payroll, infrastructure setup, and more. This enables the country manager to focus on driving growth instead of constantly dealing with unforeseen issues.
Do You Need a Country Manager?
If you’re planning to have a small engineering team to serve U.S. clients, a Country Manager may not be necessary. Administrative tasks and local regulations can be handled by the local vendor or shared office provider, instead of hiring a country manager just to be an office manager. Leadership positions for this strategy, usually are hired for the delivery team (e.g., Product Managers or Scrum Masters).
But if you’re entering Mexico to develop the local market, a Country Manager is essential. This role will spend most of his time on sales efforts, and in some cases, the name of the position can also be Regional Sales Director.
Mistakes when hiring a Country Manager
Is crucial to hire someone with previous experience working for international companies, but it should also have to have an entrepreneurship profile, be comfortable with playing multiple roles, and be resourceful when something needs to be done that wasn’t planned. Someone accustomed to a corporate environment with dedicated teams for every function may struggle in a startup-like setting.
Common missteps include hiring a candidate available on a part-time basis, thinking it will help “reduce costs”. Or somebody known in Mexico by the company, but that it lacks sales expertise to take a new company off the ground. And overlooking cultural fit, the Country Manager’s values will shape your office culture.
Real Flexibility
Expansion requires the ability to pivot—not just with the company’s solution but also with workforce size, office locations, and operational structure, creating additional costs. On top of this, expenses can quickly add up if Mexico’s unique set of rules are not considered, such as mandatory heavy severance packages for dismissed employees—even after short employment periods—and not allowing the use of contractors for core functions. Dont’ skip the pre-landing planning, reach out to specialists. You don’t know what you don’t know.
As a tip, don’t reinvent the wheel, there are soft-landing options for each strategy, including pay-per-use options. For instance, the Pilot Operation model allows companies to test the market before committing long-term. And Subsidiary-as-a-Service offers flexibility for scaling operations as needed, avoiding the rigid terms of traditional B.O.T. (Build-Operate-Transfer) contracts. These frameworks also mitigate shutdown costs in case of an abrupt exit or cancellation
Accelerate Time to Market
Setting up a standalone entity in Mexico can take 3–4 months, while soft-landing options can reduce this timeline to weeks. This might sound great, but is not the complete picture.
When entering a new market, there is a learning curve attached, that is difficult to estimate. There might be resellers that the company will be reaching out to, only to find months after that they are not well known and can’t deliver. And trying to enter industry circles will take time to gain their trust, especially for an unknown newcomer with no local references.
As a tip, accelerate your time to market by leveraging industry-specific sof-landing providers, for example in Manufacturing and Tech. They facilitate the entrance to the industry ecosystem, as they are already well known. You gain industry-specific best practices, market data and research, vetted talent databases, and extensive local networks with industry associations, embassies, universities, resellers, and more. This will shorten dramatically the learning curve and improve your time to market.
Conclusion
A post-COVID business environment made some companies think that hiring remotely one salesperson in a new country, working from home, with foreign language demos by engineers in other time zones was a good idea to crack open a market. In reality, the head of the new region will need a structure in place, plus all the help they can get to shorten the company’s learning curve to improve their chances of success, sooner, rather than later.
Soft-landing solutions offer the infrastructure you need without the associated high costs. Like using AWS instead of building your own data center, these solutions provide scalable, cost-effective services tailored to your needs.
Look for specialized vendors in your industry to get the most out of your buck and bounce off your ideas with them. They might remind you that in Mexico you shouldn’t be using the same employee number metric as in the USA to segment potential prospects and might even get you into the door of your first conversations with local industry players.
They will go the extra mile, as your success will mean possible services in more areas. A headhunting firm will only validate references provided by candidates, whereas a specialized provider will tap into their industry network to verify the candidate’s track record. Their vested interest in your success fosters proactive collaboration, such as alerting you of possible unreliable resellers and prospects.
Expanding into Mexico can transform your business. Don’t place the entire burden on one individual. By adding the right soft-landing provider to your expansion strategy, you can reduce risks, increase flexibility, and position your company for long-term success in the region.
