LARRY KANTER Staff Reporter
What could be more American than ketchup?
U.S. supermarket sales of Mexican salsas and marinades hit $764.7 million last year, far eclipsing those of ketchup, which sold $431.3 million in 1996, according to Information Resources Inc., a market research firm in Chicago.
That fact is among the most frequently touted by L.A.’s ethnic food manufacturers, which aim to duplicate salsas’ success and make their products more of a staple in kitchens in Southern California and nationwide.
Towards that end, some 40 L.A. ethnic and specialty food processors recently formed their first-ever industry organization, the Food Industry Business Roundtable, or FIBR.
By joining together, local food companies hope to boost their profile, both in Southern California and around the country. They also aim to create a forum in which small, often-isolated specialty food manufacturers can share ideas and strategies.
“Hopefully, it will give us a louder voice,” said Mark Roth, president of El Burrito Mexican Foods in the City of Industry.
If the industry’s voice currently is muted, it’s not for lack of numbers. Food processing is one of the region’s largest manufacturing sectors particularly in the low-income communities of Southeast and South Central Los Angeles.
RLA, the business development group that helped the firms organize under FIBR, estimates that 700 local food companies employ more than 30,000 people and generate some $4.9 billion in annual sales.
Many of those companies are small, family- and minority-owned firms that are well-established in their particular niches, but whose owners are unsure of how to bring their products to the nation’s table.
FIBR intends to address that issue, and others. A luncheon held last month featured workshops on how to export food products, as well as how to take advantage of state-sponsored job-training programs.
Some FIBR members also hope a higher profile will attract investors looking to buy into the growing popularity of ethnic food products.
“(L.A.) is the premier source of ethnic food processing,” said Henry Leong, vice president of Quon Yick Noodles Inc. in Lincoln Heights. “We don’t get the attention we deserve.”
With about 40 employees working in two factories, and yearly sales of more than $1 million, Quon Yick Noodles is one of the area’s largest Chinese noodle manufacturers. For 40 years, the company’s noodles, wonton skins and eggroll wrappers have been sold in Asian groceries throughout Southern California.
More recently, Leong began making headway in getting his products on the shelves of mainstream supermarkets located in neighborhoods with large Asian populations.
While the appetite for ethnic foods is pronounced in Southern California, the rest of the country is not far behind, said Tim Willard, a spokesman for the National Food Processors Association, an industry group in Washington D.C.
“The taste of America has changed,” said Willard. “The average American is more willing to experiment, both in restaurants and in their own cooking.”
Nonetheless, small ethnic food firms have a tough time getting into big, mainstream supermarkets, largely because of the large chains’ practice of charging food manufacturers for shelf space.
Depending on the product, those so-called “slotting fees” could cost a food company as much as $700 per store to launch just one new product line, said Leong.
As a result, many local firms concentrate on selling their products to restaurants, said Kenny Yee, president of Wing Hing Noodle Co. in South Central Los Angeles, which employs 30 workers and sells $4 million a year in noodles, won ton and fortune cookies to restaurants nationwide.
“Restaurant people are more open,” said Yee. “They’re getting creative and trying to use our products in their own recipes. That’s our focus in trying to sell in the mainstream market.”
Roth of El Burrito learned the hard way that going mainstream often can be a mixed bag.
After scoring considerable success selling its super-hot fresh salsas in the local Hispanic market, Roth toned down the spiciness in an effort to appeal to more-mainstream palates. The salsa craze was raging, scores of new companies were entering the market, and moving towards the center seemed like a sound growth strategy.
But Roth found that any gains in new customers were being offset by a drop in sales to his loyal Hispanic shoppers, who had been turned off by the milder flavor.
Now, he said, El Burrito makes two fresh salsas a fiery hot one for the Hispanic market and a mild one for the mainstream.
“It’s what we should have done that in the first place,” Roth conceded.