Doing Business In Mexico

Executive Summary

To be given an opportunity to do business in Mexico, one must understand where to start and how to deal with a totally different social and cultural environment from what one is accustom too. To succeed in making a good first impression and to carry out any type of business transaction, it is important to understand what these differences are.

When conducting business in Mexico, there are specific things that must be understood and complied with. Just understanding how important building a relationship is, such as shaking hands and exchanging pleasantries can have a huge impact. What could potentially be the start of a bad or mediocre business trip now has the possibility of being a successful one.

A businessperson needs to understand that the Mexican government plays a large part in establishing a business in Mexico. The government in Mexico influences and controls the Mexican business world due to that most business transactions require a permit. Because of the strong government influence, many business practices in Mexico are corrupt. Not understanding or taking the time to learn Mexican business etiquette along with rules and regulations, one can find their self in a compromising position.

This paper intends to provide the necessary details such as customs, etiquette, mannerism, and culture of doing business in Mexico

Business in Mexico

Bienvenido a Mйxico! Welcome to Mexico, the first of what one would hope to be many greetings expected upon entering into Mexico. With Mexico's population fast approaching the 100 million mark, "North Americans, what Mexicans refer to people from the United States" (Nicol, 2003) the lower labor rates and the strength of the American dollar against the peso over the last several years has created an influx of US manufacturing businesses into Mexico. "Mexico has become one of the United States most important trade partners. It is the third largest exporter to the United States, and its international trade products include oil exports, tourism, and the products of its many assembly plants."(Nicol, 2003)

Mexico official language is Spanish though English is used and widely understood by the Mexican business world. Business meetings should normally take place and be conducted in Spanish but most of the time the business hosts will more than likely try to accommodate to the language needs. Any attempts by a foreigner to speak Spanish are appreciated and shows respect for Mexicans, even if the attempts are less than favorable.

There is to per say no official religion of the country, however almost 90 percent of Mexicans are Roman Catholic

Mexico has become a large global presence and it is important to understand the business etiquette and mannerisms of the country in order to successfully conduct business in Mexico.

Business Appearance

When doing business in Mexico, it is important to wear clothes that are similar to what Mexican businesspersons wear. Men should wear a conservative dark suit and tie. A white shirt is more formal and should be worn when the formality of the meeting dictates. Women should wear a dress or skirt and blouse. For the men and women, the classic colors of gray, navy or white is acceptable. Should the occasion arise, casual wear for the men would consist of a light shirt and pants and for the women a blouse with pants or skirt. Jeans are not appropriate nor tight or low cut clothing.

Business Etiquette

Personal relationships are important part in doing business in Mexico and Mexicans put a great deal of emphasis on this. Relationships between people/companies must be developed first. Mexicans will make friends first, and then do business. In a lot instances, an intercessor will be needed to set up business meetings and make introductions between the parties. This intercessor serves as "the bridge that builds the trust necessary to do business in Mexico."(Mexperience, 2006) When in a meeting, begin with small talk discussing such things as the family, "Mexican culture, history, art and museums. Never bring up and discuss topics such as the Mexican-American war, poverty, illegal aliens or earthquakes."(Nicol, 2003) Americans would need to be very careful with hand gestures. The gesture of circling the index finger to the thumb to give the "Okay" sign is "extremely offensive" to the Mexicans. The placement of ones hands on their hips is a sign of aggressiveness, while placing the hands the pocket is impolite. (CC Consulting Ltd 2004)

Breakfast, Lunch and Dinner

Any type of business meeting can take place while eating, depending on the time of day. Business breakfast is common in Mexico and usually run between the hours of 8-11 am. Most of the time business breakfasts are conducted in "good restaurants." Usually these business breakfasts "will last no more than two hours." (Mexperience, 2006)

Lunches start around 2:00 pm and lasting until 4:00. In Mexico, lunch is the main meal for the day and not to be used as a "detailed power lunch." (Mexperience, 2006) During this time, business ideals and concepts are discussed but the specifics are not. At other times, lunch will be used to finalize agreements from previous meetings.

Dinner in Mexico is a late night affair starting around 9:00 pm. There could be times where circumstances will dictate that business needs be done at dinner. Majority of the time though, dinner is reserved for the family, which is very important to the people of Mexico. Should one be invited to dinner, "business should not be discussed unless the host wishes to discuss." (Mexperience, 2006)

Picking up the tab is "not customary nor splitting the bill which is frowned upon. Rule of thumb is that the seller covers the expenses." (Mexperience, 2006) Tipping is much like that in the United States when good services are given.

Culture

Prospective businessmen would find that Mexican business culture has a warm, friendly atmosphere, with a slower pace. Greetings meeting between businesspersons can vary depending on how well the acquaintances know each other. For example a man greeting another man for the first time, a simple handshake will suffice. For those that have known each other for some time, an embrace will take place. A man meeting a woman, a handshake will do, but should the woman lean towards the man as though to kiss, the man would respond by simple giving an "Air Kiss" on the cheek. (Mexperience, 2006) This same air

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