California Again Leads in Latino Companies, Though Not in Revenue
California surpassed other states this year with the largest number of top-earning Latino-owned businesses but trailed Florida in total earnings, a legacy of the agricultural and recent immigrant past of the state’s Latino community.
Hispanic Business magazine listed 121 California companies, with total earnings of $2.4 billion, on its annual ranking of the country’s 500 highest-earning Latino businesses. No California business made the top 10.
By contrast, the 117 Florida businesses on the list together grossed $4.1 billion, nearly twice as much.
Strength in numbers but the second-place showing in earnings has characterized the state every year except one since the rankings began in 1984.
But Latino leaders and others who track the business community expect Latino businesses in California to make a stronger showing in the next 10 years as they continue to mature.
“This is a snapshot of the Hispanic community now,” said policy analyst Harry Pachon. “In another decade, if you took a snapshot, California might lead the nation as far as total gross earnings for Hispanic businesses.”
Frank Moran, president of the Latin Business Assn., a national organization based in Los Angeles, said the data reflect the California Latino community’s immigrant past as agricultural workers.
“Those migrant workers did not come to California with formal educations, resources or business experience,” he said.
Continued immigration from Mexico, Nicaragua, El Salvador and other Central American countries has created a diverse Latino community that has been difficult to unite, Moran said.
Finally, the sprawling Latino communities in Los Angeles and other California cities spawn smaller businesses tailored to specific neighborhoods. Such businesses can exist in comfortable niches without having to expand, Moran said.
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Latino communities in other regions have different pasts that shape their business environments, said Pachon, president of the Tomas Rivera Center, a policy research institute at Claremont Graduate School.
“Miami is a good example of what happens when you have an elite move into an area,” he said.
Florida’s Cuban Americans are predominantly refugees from the 1960s: well-educated, older and experienced in international trade, especially the sugar industry, Pachon said. California’s Latino entrepreneurs are younger, with little international experience or involvement.
Many Texas Latino business owners rank among the country’s highest earners because they come from long-established, multigenerational families. Only 20% of Texas Latinos are foreign-born, compared with 52% of California Latinos, Pachon said.
But Moran and Pachon said the picture is changing for California.
The recent opening of a Pan-American Bank branch in Los Angeles, the courting of the Latino business community by large banks such as Wells Fargo, and efforts by Los Angeles Mayor Richard Riordan to pair small companies with large firms will help strengthen Latino businesses and boost earnings, Moran said.
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“What we are in California is in the process of developing a Hispanic business elite,” Pachon added.
Nationwide, Latino businesses on the magazine’s list reported revenues of $14 billion in 1995, up 15.2% from 1994. That increase surpassed the 9.9% rise reported by the Forbes 500 list, the 10% increase by the Fortune 500 and the 11.8% improvement tallied by Black Enterprise magazine’s list of the nation’s top black-owned auto dealerships and industrial and service companies.
Hispanic Business said the higher earnings reflect the growing maturity of Latino-owned businesses. To qualify for the list, Latino businesses had to earn at least $5 million a year; more than 50 had revenue of more than $50 million a year.
The Santa Barbara-based magazine compiles its list from questionnaires mailed to more than 12,000 Latino business owners across the country. Most of the 500 top-earning companies were clustered in the service industry (21%), manufacturing (20%), wholesale (20%) and automotive (15%). The rest were in construction, finance, retail and transportation.
The 10 highest-earning Latino companies together reported $3.1 billion in revenues. The companies came from seven states and included three from Florida and two from Texas. Four were in automotive sales and services, including one which also ran a beer wholesaling company.
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The other top-earning companies were engaged in food manufacturing, construction, banking services, employment services and supermarket operations. Only one technology company, CTA Inc. of Rockville, Md., a 7-year-old firm with 1,400 employees and $217 million in earnings, was on the list.
Of the 121 California companies on the list, 60 were from the Los Angeles area and 13 from San Diego.
The magazine also listed the top 10 companies in various industries. The 17 California companies that made those lists include Los Angeles-based tortilla manufacturer La Reina, Inc., an 11-year-old company with 400 employees and $50 million in sales, and retailer King Taco Restaurants, a 22-year-old company with 429 employees and $22.63 million in sales.
TELACU Industries, an economic development company that began 28 years ago in Los Angeles, ranked among the nation’s top 10 Latino service businesses. TELACU now has 850 employees and $100 million in revenue.
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Infotec Development Inc. of Santa Ana, a computer systems integration company, was listed as tops in the service category. The 19-year-old company has 400 employees and $113.8 million in sales.
Latino transportation leaders included Albert Rebel & Associates Inc. of Pomona, a 50-year-old company with 52 employees and $29.20 million in sales.
Two California companies were among those with the greatest revenue increases: Valenzuela Engineering Co. of Santa Maria and Pacific Access Technology Holdings of Rancho Cordova.
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Top Latino Firms
With 121 firms, California led the nation in Hispanic Business magazine’s annual list of the nation’s top 500 Latino-owned businesses in terms of 1995 revenue. Florida was second with 117 and Texas third with 67. Here’s how the top California firms ranked on the list:
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Rank Revenue in U.S. Company and Location (in millions) 16 Lloyd A. Wise Cos., Oakland $152.65 19 Rosendin Electric, Inc. San Jose $140.00 24 Infotec Development Inc., Santa Ana $113.80 27 TELACU Industries, Los Angeles $100.00 32 Pacific Access Tech., Rancho Cordova $ 92.00 34 Ruiz Food Products, Inc., Dinuba $ 85.50 35 Ramos Oil Co., Inc., W. Sacramento $ 85.00 42 Alrod Intl. Inc., Burlingame $ 61.74 46 Complas, Inc., Corona $ 59.00 56 La Reina, Inc., Los Angeles $ 50.00
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Note: Hispanic Business magazine mailed out 12,000 questionnaires to Latino-owned businesses nationwide and accepted submissions. Companies were self-reporting using tax data.
