Assessing the Market Potential for Housing Construction Products in Mexico

Abstract

Studies on international construction activities tend to focus on project contracting or exporting of raw material (such as cement or steel). However, globalization and free-trade agreements are creating new opportunities for international trade in manufactured housing products (such as roofing systems and other components). The aim of this work is to understand the factors that impact the potential profitability of housing construction products in international markets and develop a process for profitability assessment. This was done in a test market (the Mexican market) through reviewing pertinent literature in conjunction with conducting interviews with experts in this domain. The analysis shows that six major processes have to be undertaken: (1) analysis of market conditions (preventure analysis); (2) assessing competencies; (3) evaluation of product and service; (4) analysis of proper distribution channels (supply chain); (5) evaluation of marketing strategies; and (6) analysis of cost-price-value relationship. A set of factors and best practices has been identified to support and guide the conduct of each process.