E-Commerce Is Booming In Mexico

For online retailers, business is booming in Mexico. Over the past few years Mexico has been one of the fastest growing e-commerce sectors in the entire world. It is the second largest market for online sales in Latin America (after Brazil). According to the Mexican Association of Online Sales (AMVO), Mexico’s e-commerce sector expanded by 24.6% in 2023, surpassing $44 billion in sales.

Mexico is already one of the top fifteen markets in the world for online sales, but growth of its e-commerce market continues to be constrained by factors including weak home internet penetration in small rural communities, high prevalence of residents without bank accounts, and logistical issues in delivering products to remote towns.

Nearly half of Mexico’s adult population does not have a bank account. Around four-fifths of Mexico’s residents do not have a broadband internet connection at home.

But, despite ongoing struggles with rural internet penetration, a majority of Mexico’s population is online. Nearly eight in ten residents have access to the internet through smart phones.

Foreign executives studying Mexico’s e-commerce market need to understand the importance of mobile internet access. More than two thirds of Mexico’s online sales are made via mobile platforms.

Consumers in Mexico are using their cell phones to purchase everyday items such as groceries but also to make sporadic purchases on clothing, books, and other items. In the near future, electronic gadgets, food products and clothing are likely to remain among the top categories for online sales in Mexico.

Major multinational companies such as Amazon, Uber Eats, and Mercado Libre have a strong presence in Mexico, but local retailers such as Palacio de Hierro, Liverpool, and Chedraui have also expanded their footprint in e-commerce. Tens of thousands of smaller Mexican companies are also selling their products online. For instance, Mexican cycling clothing maker Aphesis and bicycle manufacturer Chop Chop both have online sales platforms.

Even though Mexico’s economy is only expected to grow by 1.2% in 2025, e-commerce will likely continue to expand. Efforts to expand internet access in rural areas, such as a $90 million contract with Elon Musk’s Starlink, will likely catalyze further growth of online sales. A new 16% tax on foreign companies’ online sales won’t derail e-commerce. Overall, online sales in Mexico are expected to log double digit annual growth between 2025 and 2030.

Foreign executives doing due diligence on potential market entry into Mexico need to understand the unique strategies helping some companies succeed in Mexico's booming e-commerce sector. Contact us to discuss how we can incorporate our political risk analysis into your strategy.

This blog post is based on a recent article by Latin American Lens's Nathaniel Parish Flannery.

One other issue affecting e-commerce in Mexico is cargo truck hijacking. See our recent report on hijacking risk in Mexico here.