The online retailer Mercado Libre has announced its plans for a new logistics and distribution center in Mérida.
The Argentine firm competes directly with other industry giants such as Amazon — which is reported to be opening its own logistics and distribution center in the coming months.
Over the past couple of decades, Mercado Libre has established itself as a major player in the online retail industry in Latin America, and now makes up 57% of all online sales in Mexico, according to The Economist Mexico.
The exact location of the new logistics and distribution center was not disclosed, but industry analysts speculate that it will most likely be in Mérida’s industrial park.
Several foreign residents in Mexico have reported that Mercado Libre currently does not accept foreign credit or debit cards. According to the company website, the rejection of foreign cards is not standard policy but rather is the result of anti-fraud measures — such as an inability to verify a Mexican home address.
Other Mercado Libre distribution centers are also planned across the country, including in the states of Jalisco and Nuevo León.
Early in its history, Mercado Libre formed a strategic alliance with eBay which has allowed it to compete with other large multinationals and offer services such as next-day delivery.
However, unlike Amazon, most transactions on Mercado Libre are made between individuals buying and selling goods and services directly.
Another contributing factor to the success of Mercado Libre has been the large-scale adoption of Mercado Pago, the companies very own payment processing system.
Online shopping, along with delivery platforms such as Uber Eats and Rappi has experienced unprecedented growth in Mexico over the past couple of years, likely as a result of the pandemic.
Even retailers which were not really well known for online shopping in Mexico such as Costco, Walmart, and Liverpool have beefed up their online and delivery infrastructures.