Dreamers Build Great Companies

Mel Coleman Jr. of Coleman Natural Meats, Fred Ruiz of Ruiz Foods and Gerald Shreiber of J&J Snack Foods all made their dreams into $500 million companies.

By Diane Toops, News and Trends Editor

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"The biggest enemy of the natural and organic category, for producers and consumers alike, will be a commodity mentality," says Coleman. "A commodity mentality lacks the commitment to do something for the next generation."

 


 

Only in America

Fred Ruiz -- Ruiz Foods

It's an "Only in America" story. Immigrant family with strong family values works hard, sees opportunities where others don't and succeeds. Then they give back to the community by funding programs focusing on children and education. That's the legacy of Dinuba, Calif.-based Ruiz Foods, a family-owned manufacturer of authentic Mexican frozen foods.

Situated on 43 acres in the heart of the San Joaquin Valley is Ruiz Foods' headquarters and main manufacturing facility. Plants in Tulare, Calif., and Denison, Texas, help Ruiz Foods manufacture more than 200 products under the El Monterey brand, all with an authentic Mexican touch and many based on the recipes of family matriarch Rose.

"Our family has been in the U.S. for about 85 years," says Fred Ruiz, co-founder, chairman and CEO. "In the early 1960s, my dad, who has always been an entrepreneur, and his brothers founded a tortilla company, so we moved from Los Angeles to the central valley. It was the largest tortilla company in the country, but the brothers didn't get along. One day, my dad walked away from it. I was angry for a while, because I thought it was going to be my future. But when I finished college, he told me he had an idea to start a frozen Mexican food company."

Background Information

Father and son began making cheese enchiladas and selling them locally. They started with the family's two-door twin chest freezer and Kitchen Aid mixer, found an old stove in a junkyard and set up the kitchen. "I was in charge of manufacturing and dad was in charge of sales," says Ruiz. He confides he made some "really bad stuff," but quickly learned that in the food business quality and consistency are really important.

"A few years later, we moved to an existing poultry plant so we could start making meat enchiladas and burritos," says Ruiz. "Through it all, the most important ingredient was the recipes my mom prepared for us when we were growing up. That's what makes America great; it's a revitalization of enthusiasm and people, who can see opportunity where others don't."

Under state inspection at the time, their business grew. But when the USDA began inspecting, "They said we were producing too much product in our plant," says Ruiz. "They gave us three options: expand the existing building, build a larger facility or cut back on production -- which I thought was unAmerican."

The Ruizes borrowed money from the Small Business Administration and built a larger facility, going from 2,500 to 11,000 sq. ft. In 1990, Ruiz moved its corporate headquarters to Dinuba where the company built a new manufacturing facility and distribution warehouse (now 250,000 sq. ft.). Then came a 20,000-sq.-ft. manufacturing facility in Tulare in 2003 and last year a 260,000-sq.-ft. manufacturing facility and distribution warehouse in Denison, Texas.

"Our business has always experienced double-digit growth," says Ruiz. "We've been riding this wave of Mexican food popularity via the growth of the U.S. Latino population. Today, it's much more competitive with many more players.

Ruiz emphasizes that he and his father had a lot of help. "Our team members have been a great competitive advantage for us. I learned a long time ago when the accountants and lawyers say you can't do things, but you bring people together and focus on the task at hand, it's amazing what you can do. There is a lot of power in people when you channel that effort. We have 2,500 team members, and many have been with us for many, many years."

In his niche of the food business, authenticity is as important as consistency. "Being Mexican, I know what authentic food tastes like, and we've always flavored our products the way my mom prepared enchiladas, tacos, burritos and tamales at home. We started on this path, and we're very fortunate that consumers have grown with us."

While he credits the mass popularity of Mexican food to restaurants like Taco Bell and El Pollo Loco, "Our food is not Americanized, and that's a competitive advantage. When major food companies conduct focus groups for a Mexican product, they ask if the food tastes good and if the consumer would buy it. One thing they don't ask is, does it taste Mexican?"

As Mexican consumers have acclimatized to the U.S., they have changed their cooking and eating habits, according to Ruiz. Second-generation Latinos, who are now Americans, work hard and don't have as much time to prepare food, so they are looking for convenient ways to feed their families. "They know what good Mexican food tastes like, so they are very much a consumer of ours. In fact, we get letters from them all the time thanking us for picking up the slack."

Ruiz has great expertise on trends in the Mexican/Hispanic community. "The issue of spiciness and authenticity is an important trend," he says. "Not only is the Latino migration impacting the Anglo population, but the Anglo population is more global. They travel to different parts of the world and are exposed to many ethnic foods. People are not afraid to try spicier foods, so I see ethnic foods in general continuing to grow."

"R&D is really important to us, in fact, we have a mandate: I ask that 20-25 percent of our sales every year come from new products," says Ruiz. A new product takes time from introduction until it achieves success, up to four years, according to his expectations. "But if a product does not earn its right to the table, we discontinue it," he says.

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