Mexico Has The Lowest-Cost Advantage For United States Businesses

Cost might not be the only factor when choosing a nearshore location or evaluating whether to establish business operations in another country. However, operating costs remain an important consideration in many business decisions.

• KPMG's International Business Cost Study
• Mexico's Cost Advantage in the 2016 Study
• Corporate Services and Back-Office Operations
• Applying the Nearshore Model to Contact Centers

KPMG's International Business Cost Study

From 1996 through its final edition in 2016, KPMG conducted its Competitive Alternatives analysis to provide insight into the cost of doing business in locations around the world, with particular focus on North America, Europe, and Asia-Pacific.

The 2016 study compared business costs across 10 countries and examined four major business sectors:

• Digital Services
• Research & Development Services
• Corporate Services
• Manufacturing

The analysis considered location-sensitive factors such as labor, transportation, utilities, cost of capital, and taxes.

Mexico's Cost Advantage in the 2016 Study

In KPMG's 2016 study, Mexico ranked as the lowest-cost country among the 10 countries evaluated.

The study reported that Mexico held an overall business cost advantage of 22.5% compared with the United States. This represented Mexico's strongest overall cost advantage relative to the U.S. during the period covered by that edition of the research.

Mexico ranked first among the countries analyzed across all four business sectors included in the study.

Corporate Services Showed the Largest Cost Advantage

Mexico's largest advantage relative to the United States appeared in the Corporate Services sector.

The 2016 study reported a Corporate Services cost index of 47.2 for Mexico, representing costs that were 52.8% lower than the U.S. baseline used in the analysis.

KPMG noted that Mexico's cost advantage was particularly significant for clerical and administrative positions compared with highly skilled professional and technical roles.

“Foreign investment in Mexico tends to focus on the manufacturing sector, but Mexico also presents a strong value proposition for back office operations.”

— Oscar Silva, Global Location and Expansion Services, KPMG in Mexico

Explore the Benefits of Nearshore Contact Centers in Mexico

Corporate Services and Back-Office Operations

The Corporate Services category was particularly relevant to organizations evaluating shared-service and business-process operations in Mexico.

These types of operations can include centralized accounting, administrative functions, customer contact centers, internal IT support, and other business process outsourcing services.

For companies considering Mexico, cost is only one part of the decision. Organizations must also evaluate workforce availability, infrastructure, technology, management accessibility, business continuity, compliance requirements, and the ability to integrate the Mexico operation with existing U.S. teams.

Workforce and Infrastructure Matter Too

A lower operating cost provides limited value if the workforce, facilities, or technology cannot support the required service levels.

CCSI's nearshore model combines access to bilingual and bicultural personnel with established contact center facilities in Mexico, technology infrastructure, administrative support, and local management resources.

This allows organizations to evaluate the total operating model rather than focusing exclusively on hourly labor cost.

Applying the Nearshore Model to Contact Centers

For contact center operations, Mexico's cost structure can be combined with additional nearshore advantages such as geographic proximity to the United States, compatible business hours, bilingual talent, and cultural alignment with North American customers.

CCSI provides different operating models depending on how much infrastructure and administrative responsibility a client wants to assume.

Turnkey Nearshore Operations

Through CCSI's Turnkey Nearshore Contact Center Program, companies can establish an operation within CCSI's existing corporate structure and facilities in Mexico.

CCSI manages local administrative functions including workforce recruitment, human resources, payroll administration, facilities, IT infrastructure, and other operational support while the client maintains control over its processes, training, technology, quality standards, and day-to-day business activities.

Customized Corporate Operations

Organizations seeking a more customized infrastructure model can also evaluate CCSI's Corporate Advantage Program, which is designed around the client's specific facility, workforce, technology, and operational requirements.

Both models reflect the broader principle highlighted by the original KPMG study: companies should evaluate the complete cost and operating structure of a location rather than focusing on a single expense category.

The strongest nearshore business case is not based on cost alone. It combines competitive operating economics with the workforce, infrastructure, technology, proximity, and management structure required to deliver consistent performance.

Explore CCSI's Turnkey Nearshore Contact Center Program

Historical note: This article discusses findings from KPMG's 2016 Competitive Alternatives study, the final edition of that research series. The 22.5% overall cost advantage, 47.2 Corporate Services cost index, and 52.8% Corporate Services cost difference cited above reflect the business conditions, exchange rates, methodology, and comparative locations evaluated in that 2016 study. They should not be interpreted as current 2026 cost comparisons. Current CCSI pricing and operating information is available through the linked program pages above.

Originally published: March 27, 2017
Last reviewed and updated: July 25, 2026