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DOING BUSINESS IN MEXICO
by Bob Brooke

 

Reforma Blvd, Mexico CityMexico is known for its breathtaking natural beauty, which makes it an ideal vacation destination. But Mexico also has a sophisticated culture with an amazingly advanced and complex economic system. The complexity of its system is what makes doing business there such a challenge.

While on the surface doing business in Mexico may seem similar to that of the U.S. and major European markets, underneath it's completely different. All decisions are usually made by the top person of the company. If he or she isn't available, the decision cannot be made. Also, business protocol is formal.

Because titles are important in Mexico, businesspersons should address everyone formally to show respect until the individual has asked to be referred to by his or her first name. A common business title is Licenciado (meaning college graduate). Though Mexican businesspersons are highly educated and deserve the title of Liceniado, just as many give themselves titles with nothing to back it up.

Formality extends to dress, also, especially in the larger business centers of Mexico City, Guadalajara and Monterrey. Men wear dark suits, and women, dressing conservatively in tailored and subdued styles, should keep relationships formal. However, in the provincial cities, especially in the hot tropics, most men wear only a cool cotton shirt and slacks and women a blouse and skirt. And though they may look casual are strictly formal when conducting business.

All important business is usually conducted in Spanish and it's best to bring an interpreter rather than struggle with English or some other language when closing important deals.

Mexico is a country where business is done with "friends." On the whole, a handshake means more than any contract and a businessperson's chosen business associates will bend over backward to avoid even the appearance of impropriety.

Those experienced in the ways of Mexican business often state that anything less than a partnership in Mexico doesn't work. For this reason joint ventures have become increasingly popular.

To a Mexican, family is everything. It's the glue that holds together the fabric of society during crises. The Mexican concept of familia means more than its literal translation of family. The Mexican's family, which frequently includes several generations, is his or her main source of pride and joy. Social life commonly centers around family get-togethers, and marriages are often business alliances between families. It's for this reason that most of Mexico's largest corporations are still family owned.

In Mexico, the family is the centerpiece of life. Mexicans never mix business with family. However, Mexicans place a great deal of importance on the social aspect of business, deciding whether or not they want to do business with a particular person. Aggressive sales tactics and hard sell usually flop.

It's an honor to be invited into the home of your host especially on Sunday for a family activity. It's customary to bring a gift for the lady of the house, and good wine or liquor is always appreciated. Guests shouldn't take offense when their host doesn't open their gift right away. This is considered rude in Mexico, where gifts are thought to be personal.

The Mexican businessperson's system of priorities is family and social obligations first and business later. A seeming indifference to another's problems is merely a show of the Mexican's dignity and control under pressure. In general, the Mexican business environment is more easygoing than that in most other countries. But easygoing charm isn't the same as laziness. Mexicans usually deal with things one step at a time.

For instance, everyone follows the daily ritual of the long lunch. While the Mexican's U.S. counterpart partakes of a networking-power-brainstorming lunch of sprouts and decaf, the Mexican is enjoying a hearty and relaxed multi-course meal, often with alcohol. Conversation rarely touches on the specifics of business. Talk of family and friends is the rule. The Mexican takes the opportunity to judge his counterpart at lunch on their control and their attention to family and social concerns.

As far as appointments are concerned, it's best for businesspersons to secure a lunch or dinner meeting and be prepared to spend a long time as it's traditional to conduct business over a long meal. Businesspersons should be sure not to schedule another appointment directly following the meal and no appointments should be made on Sunday, traditionally a family day.

Besides business lunches, most fine restaurants serve breakfast in Mexico City where businesspersons discuss deals over "power" breakfasts, turning many an elegant restaurant into a "board room."

As in many countries, good secretaries are often the "gatekeepers" of high-level Mexican executives. It pays to spend a few minutes with a secretary before an important meeting. They often will reveal some helpful hints on dealing with their boss. Giving one a small gift of a candy bar isn't uncommon.

Smoking is still prevalent in Mexico, especially at business meetings, whether in the office or at meals. Non-smokers should try to be tolerant.

In the major business centers of Mexico City, Guadalajara and Monterrey, traffic can be horrendous at most times of the day. Allow plenty of time for travel to meetings. In Mexico City, a centrally located hotel is a must. Though Mexicans are notoriously late for meetings, they don't like it when they have to wait for their foreign counterparts.

The manana syndrome is basic to Mexican business. Those who understand what it is, how it works, and how to use it in their favor will prosper in business. Those who deny it will fail.

The word manana literally means "tomorrow." But figuratively, the word has a different meaning. What at first seems to be procrastination is merely the way Mexicans prioritize their lives and activities.

Mexicans take great pride in their businesses. Business pride is sometimes demonstrated to the extreme. Mexican workers are dedicated to working until the job is done, however long it takes. Most work until 19:00 or 20:00 o'clock. When Mexicans get down to business, they do it with speed and efficiency without apparent effort.

The word "deadline" has a somewhat different meaning in Mexico. Every contract has an implied granting of an extension for important events. Deadlines should be flexible.

Red tape can be a stumbling block for most foreigners doing business in Mexico. They fear that even when requirements are met, an arbitrary and occasionally capricious government official might stop them from moving ahead. The rule is to be sure to comply with the requirements correctly the first time because the appeal procedures are somewhat limited and penalties for violating the rules are substantial.

Since signing the NAFTA agreement, Mexico has done away with the more complicated business visa, at least for U.S. citizens.  Under the new procedure, businesspersons simply fill out a short business travel card similar to the tourist card currently used for recreational travel. This 30-day no-fee business travel card, to be used along with a valid passport, is issued by Mexican consulates, travel agencies, and airlines and is collected at the point of entry.

As Mexico becomes a noted center for international business, the level of service for the business traveler has risen markedly. Hotels are renovating or constructing state-of the art facilities to accommodate every need of world-class business travelers.

Executive floors have become common in the larger luxury hotels. While each varies in decor and ambiance, all offer spacious rooms with king-size beds, a private executive lounge where a complimentary Continental breakfast is served, and private check-in. Most also have limited access through keyed elevators.

Business centers have also become the norm in many hotels. Mexico City, for example, currently has 14 hotels with centers equipped with computers, fax machines, copiers, secretarial help, conference rooms, and more. One of the forerunners in this area is Fiesta Americana Hotels. Some like the chain's flagship property, the Fiesta Americana Reforma Hotel, offer computer and typewriter rental, as well as translation services.

To be successful in doing business in Mexico, it's a matter of understanding parameters and working with them.

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