Nowports: Leading Latin America’s Digital Freight Forwarding Revolution
Making Freight Forwarding Easy and Efficient
Nowports is the first and largest 100% digital freight forwarder in Latin America, with a presence in 8 countries. It moves goods efficiently, transparently, and securely. Its customers get customized logistics solutions, with access to a platform that centralizes their information and facilitates the traceability of their shipments and bonds.
Behind the Success: The Story of Alfonso De los Ríos
Alfonso De los Ríos is its 24-year-old CEO and co-founder. His story is that of a boy from Monterrey, one of the most industrialized states in Mexico, who started programming at a very young age after growing up in a home where there was no shortage of economic hardship. He was personally invited by Esther Wojcicki to Silicon Valley and then went through Y Combinator with Nowports. Now with “nearshoring” underway, Alfonso is leading the company to Pan-American expansion.
Nearshoring in Mexico: A Game-Changer for the Industry
Ongoing tensions between the U.S. and China have prompted many U.S. companies to undertake a massive relocation of their factories to Mexico. This phenomenon has been dubbed “nearshoring”, the inverse of offshoring. This means that companies are progressively transferring part of their production to countries close to their markets and with similar time zones, in order to minimize the effects of disruptions in supply chains. According to a recent Prosper Insights & Analytics survey, the disruption and shortages in the supply chain can take up to 6-12 months to normalize. The world is beginning to move out of China in the same way that they flocked to the Asian giant during the 1990s. The close integration that exists between North American countries through the T-MEC, the international agreement that facilitates trade between the U.S., Canadian and Mexican markets, has facilitated the transition, and the Mexican automotive industry is already emerging as one of the big winners of this phenomenon.
Nowports Paving the Way for Transformation
This is something that companies like Nowports are taking the matter in their own hands. According to a recent Prosper Insights & Analytics survey, 37.3% of people feel pessimistic about the U.S. government solving supply chain issues. At the same time, the Prosper Insights & Analytics survey showed that more than a fifth of people in every generation is buying more online. I recently spoke to Alfonso to know more about nearshoring, in Mexico, and how the supply chain is transforming into a complex AI and digital network that will become key for international players to master in order to get the most out of the next few years.
Towards a Stronger Nearshoring Market in Mexico
Gary Drenik: What else does Mexico need to become the iconic nearshoring market? Alfonso De los Ríos: With nearshoring nipping at the heels of the Mexican economy, industrial developers increased the speed of building new projects during 2022 (70% more than in 2021). However, more than twice as much space would still be needed to be built in 2022. Mexico is becoming the hottest market in the region, in terms of production, skilled professionals, and advanced facilities. This is going to renew the private sector in the country with long-lasting positive consequences.
The Attraction of Mexico for International Companies
Gary Drenik: Why is the “nearshoring effect” massively attracting international companies to Mexico? Alfonso De los Rios: Tesla is the latest in a long stream of companies to announce big plans of building factories in Mexico, following other big names, while warehouses are becoming shiny gems for multinational companies in different Mexican cities. It’s clear that the reorientation of global supply chains is unstoppable. That is why we have recently expanded to the US to bridge the gap between the two regions and believe that Mexico is becoming increasingly attractive for big companies looking to increase their manufacturing standards and delivery times.
The Predictive Future of Nearshoring
Gary Drenik: What is the big “nearshoring” picture ahead? Alfonso De los Rios: I think we have big transformations that are already happening. This involves how the nearshoring will overhaul the private sector in México and its impact on the US market. Companies that set a foot in Mexico will have greater visibility, shorter delivery times, and influence the quality of their products. It’s also important that the shipping industry can keep up with these transformations. In that sense, it needs in order to become paperless and data-driven. In order for companies to thrive a data-driven approach is needed to improve their predictive capabilities.
The Importance of Digital Efficiencies in Supply Chain
Gary Drenik: Why can your digital reputation improve in the midst of a logistical nightmare? Alfonso De los Rios: According to a study published in 2021, out of 400 executives in supply chain and logistics, 40% indicated that their companies’ image has been damaged by missing deadlines or costs originating from disruptions in operations. All those customer complaints, delays in product launches, and loss of loyalty can be avoided. The solution lies in the digital transformation of the supply chain thanks to artificial intelligence tools. To improve visibility and empower logistics teams, a deep redesign of the processes involved must be undertaken. That includes using AI tools to process operations data, reliably monitoring where and when your products are, and optimizing omnichannel in every part of the process.
Smart Ports: The Future of Intra-Regional Logistics in Latin America
Gary Drenik: Are we ready for the era of smart ports in Latam? Alfonso De los Rios: It has been recently emphasized that the low productivity and growth in Latin America is somewhat explained by the reduced intra-regional trade. While Latam maintains 15% of this trade, in Europe this amounts to 60% and in North America to 45%. Although progress in this regard depends largely on government policies at the regional level, the private sector can also do its part. We are facing a new chapter in the history of intra-regional logistics. AI tools can make up for the lost time in the region in terms of process optimization. Digitization and predictability in operations is a one-way journey in the way the logistics sector works.
Investing in Tech for Future-Proof Operations
Gary Drenik: What does the pandemic mean for Nowports? Alfonso De los Rios: The pandemic unveiled the huge logistical challenges of moving goods across the world, and the current slowdown is providing a moment of relief. As ports and international logistics companies catch their breath, now’s the time to invest heavily in tech to improve the infrastructure that largely crumbled at the height of the pandemic. Ports and logistics need to catch up on