taken from a truck is fresher than that brought out of a stationary storage. The practice is much

broader than produce, however, involving meats, frozen foods, and other refrigerated goods.


IMPLICATIONS OF THE WAREHOUSING SHORTAGE FOR U.S. EXPORTERS

 As noted above, the dearth of general deposit refrigerated warehousing places limits on

smaller firms and firms wishing to enter new markets without significant on-site investments.

This problem is more severe, the more remote the firm is from that market, such as U.S.

exporters. For importers, in addition to the problem of locating physical shelter for product,

is the problem of shelter from import fees. Bonded general deposit warehouses offer such

protection. For example, a shipment of U.S. cheese could be held, indefinitely, at a Mexican

warehouse without paying any import fees. Over time, as customers place orders and product

leaves the warehouse, the firm pays import fees only on what is brought out of storage. This

allows the firm to move economically efficient shipment sizes to the market, while avoiding the

cash flow problems associated with immediate payment of all importation fees.

 Without sufficient general deposit storage, importers may find it advantageous to form

partnerships with Mexican firms. This can alleviate the physical storage problem, but without

necessarily providing shelter from import fees. In addition, the importer can profit from the

domestic firm's marketing knowledge and connections, and piggyback on to their distribution

system. Two examples of this are Sara Lee's agreement with the Mexican bakery giant, Bimbo,

and Oscar Meyer's recent agreement with Sigma Alimentos.


DEVELOPMENTS IN WAREHOUSING