Businesses cope with Mexico security risks, pass costs to consumers

they want to make sure they are adjusting to the emerging security environment correctly,” said Pablo Weisz, regional information manager for security analysis provider International SOS. “What would happen if things get worse?”

It is a question that increasingly worries companies. In a recent poll of its members, the American Chamber of Commerce in Mexico asked companies whether they felt a rising sense of insecurity in the past year. Sixty percent said they did. About a third of companies said they felt more secure in 2009 vs. 2008. Three-quarters of those, however, attributed their increased sense of security not to efforts by law enforcement to curb the violence, but to their own beefed-up, in-house measures.

Weisz said a Milwaukee company with operations in the cities of Reynosa and Ciudad Juárez, both across the Texas border, recently hired International SOS to help it create a contingency plan in the event of a “major development,” such as a shootout targeting employees. The American employees who work at the company’s plants there are mostly Texans.

The evacuation plan calls for getting workers to a safe room stocked with food and water, then arranging for a secure convoy to pick them up and escort them to the border when the threat is over.

“Most companies today want to be prepared and want to spend some money to make sure that when something happens, they have a plan in place,” he said.

Small-business people, too, have become increasingly security-minded and take additional precautions when traveling to Mexico, particularly to the capital and border regions.

Nathan Muncaster is the global business development director of Ennis-based Polyguard Products, which exports its pipeline coating products to Mexico. He travels a few times a year to meet customers.

“The only thing we do is try to provide a low profile, and if it’s at all possible, not arrive and leave the airport in Mexico City,” he said. “We’re cognizant of the fact that foreigners can get tracked.”

An inability to recruit the best and brightest managers is one of the hidden costs of Mexico’s drug war. “The biggest indirect cost of this insecurity is bringing high-level management and qualified people to your corporation,” said Alberto Islas, a founding partner of Mexico City-based Risk Evaluation Ltd. “We see it in Juárez, in Torreon, in Durango. That’s really the biggest economic impact for the country as a whole: You start to lose competitiveness.”

Corporate security has also become a question of national security. “With respect to Mexico, we all recognize that it is a challenging situation down there, and we really need companies to bear down and look for gaps and vulnerabilities,” said Brad Skinner, director of a U.S. Customs and Border Protection voluntary program called the Customs Trade Partnership Against Terrorism.

Villagran writes that in Mexico, about 800 manufacturers and 700 highway carriers currently adhere to the program’s security procedures and standards, while some, like Ryder, take additional measures.

“Who is touching their cargo?” Skinner asked. “Where are the hot spots in the movement from one city to the next? The challenge is to make it so difficult that drug-trafficking organizations are not going to look to infiltrate those particular supply chains.”

Passa, the Ryder security manager for Mexico, says he has not had a major security breach on his watch, but he receives alerts from Customs and Border Protection on companies that have fallen victim to trafficking. “We look to see which companies have been compromised,” he said, “and you will see a lot of them.”