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Strategic Site Consolidation for a Japanese Manufacturer in Mexico

A data-driven site selection analysis.

GET A CONSULTING QUOTE
PROJECT
A "stay or go" analysis for a client operating in Reynosa
WHAT WE DID
Site Selection & City Evaluation Analysis
CLIENT
A Japanese manufacturer with 900 employees
TIMELINE
Four months from kick-off to decision

THE CHALLENGE

The company operates multiple manufacturing plants in Mexico. Due to perceived security concerns and cost pressures, leadership began questioning whether to:

  • Continue operations in Reynosa
  • Relocate to a new city
  • Consolidate operations elsewhere within Mexico

The decision carried significant implications for:

  • Operational costs
  • Workforce stability
  • Corporate approval 
  • Long-term North American strategy under the USMCA framework

The company required a data-driven, objective evaluation to support a high-impact decision at the corporate level.

THE EXPERTS

Led by senior advisors with deep cross-border manufacturing and USMCA expertise, the team delivered a data-backed, board-ready recommendation.

site-selection-mexico-reynosa
Read full bio
ALEJANDRO MENDOZA President, Real EstateRead full bio
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CARLOS ALVARADO Sr. Partner & Advisor
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Read full bio
KURT SCHMIDT VP of Consulting & PMORead full bio
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JOSE LEE CAI Consulting Operations Manager
Our Approach

A Structured USMCA-Focused Site Selection Methodology

Prodensa implemented a comparative, multi-variable site selection analysis tailored to manufacturers operating within North America.

Identification of Alternative Locations

We evaluated cities beyond the client’s existing footprint, expanding their strategic view within Mexico’s industrial ecosystem.
Comparative Cost Modeling

A detailed analysis of:

  • Labor costs
  • Operating expenses
  • Infrastructure availability
  • Logistics efficiency within USMCA corridors
  • Industrial real estate conditions
Operational Consolidation Analysis

We assessed:

  • Advantages and disadvantages of maintaining multiple facilities
  • Benefits of consolidation into a single industrial hub
  • Risk exposure from geographic concentration
Independent Security Risk Assessment

To validate assumptions, we engaged a specialized security partner to conduct a detailed risk study.

Key Finding:
Security risks were materially lower than initially perceived and were not, in fact, the primary business driver for relocation.

THE OUTCOME

The study concluded that consolidating operations in Monterrey represented the optimal strategy.

Strategic Results:

  • Identified Monterrey as the most cost-efficient consolidation hub
  • Clarified that security concerns were not the principal financial driver
  • Provided objective data to support executive-level decision-making
  • Enabled corporate justification backed by quantified analysis

BUSINESS IMPACT

The project allowed the company to:

  • Make a high-stakes decision based on hard data
  • Strengthen internal alignment between Mexico operations and Japanese headquarters
  • Optimize its North American manufacturing footprint
  • Enhance long-term competitiveness under the USMCA trade environment

Rather than reacting to perception, the company acted on validated intelligence.

"My Advice to Other Manufactures? Site selection should never be driven by one pressure point. Labor rates, security concerns, or real estate costs alone rarely tell the full story. The real objective is optimizing total cost of production across the entire value chain. That requires disciplined analysis across multiple variables — and the willingness to challenge assumptions.”
Kurt-site-selection-north-america-usmca-mexico
Kurt SchmidtVP of Consulting & PMO

Why This Demonstrates Site Selection Expertise in the USMCA Region

This project highlights several core competencies critical to advanced site selection within North America:

✔ Multi-city comparative analysis
✔ Cost modeling beyond headline wage data
✔ Independent security validation
✔ Consolidation strategy evaluation
✔ Corporate-level decision support
✔ Deep knowledge of Mexico’s industrial clusters

True USMCA site selection expertise goes beyond picking a city — it requires integrating cost, risk, logistics, workforce, and strategic alignment into a single defensible recommendation.

SCHEDULE A MEETING WITH AN ADVISOR

 We look forward to supporting your next project in the USMCA.
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