Los Angeles Times
December 5, 2004

Non-Latinos Mine Southland's Mexican Market

Most entrepreneurs who cater to, and profit most, from immigrants' nostalgia for goods from home are not their countrymen.

By Sam Quinones
Times Staff Writer

When hundreds of immigrants celebrated Mexico's Independence Day at an Anaheim parking lot, they transformed the tarmac into a boisterous village carnival.

Vendors sold T-shirts with images of revolutionary Emiliano Zapata and his latter-day namesake, the Zapatista Revolutionary Army. Food stands hustled tacos and churros, sugary fried dough. The crowd cheered as an announcer called out the names of Mexican states.

As the sun set, the classic norteño band Los Cadetes de Linares took the stage and played "Palomita Blanca."

On that Orange County street corner, everything was cien por ciento Mexicano 100% Mexican. Everything, that is, but the man staging the event.

Ted Holcomb doesn't speak Spanish. He has never been to Mexico. Yet he has learned to put on carnivals across Southern California that mirror the annual festivals that Mexican villages hold to honor their patron saints.

"I have a closet full of [Spanish] books and tapes," Holcomb said. "I just don't have time to study them."

Over the last decade, Holcomb has carved a sizable business niche by offering an echo of home to tens of thousands of Mexican immigrants.

He is not alone.

The buying power of Southern California's 5 million or so Spanish-speakers, most of whom are Mexican, is measured in the billions of dollars. But most of the largest enterprises selling cherished parts of Mexican culture are owned by Koreans, Lebanese, Iranians, Israelis and nonimmigrant English speakers, people who have built their own American dream on Mexican immigrant dollars.

"You have these clever entrepreneurs who have seen an opening and they've really gone after it," said Waldo Lopez, a business consultant to the Tomas Rivera Policy Center at USC.

Among the more notable examples:

  El Gallo Giro, a seven-restaurant chain that resembles a typical Mexican taqueria, selling birria, atole, pozole and beef tongue tacos, is owned by Charles Bonaparte, a Frenchman.

  La Curacao, the largest Southern California department store aimed entirely at Latino immigrants, is owned by Jerry and Ron Azarkman, brothers who came to the United States from Israel in the early 1970s. They started out selling electronics door to door in immigrant neighborhoods.

La Curacao also holds the West Coast franchise for Pollo Campero, a wildly popular Guatemalan fried-chicken chain that is the reason that Guatemala is one of the few countries in the world with no Kentucky Fried Chicken restaurants.

  The world's largest producer of traditional Mexican cheeses, Cacique, was started by Gilberto Cardenas, a Cuban immigrant. In the 1970s, he started making cheeses from Mexico's ranchero culture, including Cotija and Poblano. Cacique, which is based in La Puente, has 600 employees, 13 regional offices nationwide and a chorizo sausage plant in Utah.

  Profiting from Mexican immigrants' fear of drinking tap water, virtually all the water stores in Southern California are owned by Asian and Middle Eastern immigrants. Wateria, the largest water-store franchise with 24 outlets, is owned by Un Soek Kim, a Korean. His office walls are decorated with census maps that show Southern California cities with populations that are 80% or more Latino.

  With 600 stores, the shopping district around Pacific Avenue in Huntington Park has one of the highest concentrations of Mexican-oriented businesses in Southern California. Most of them are owned by Korean or Lebanese immigrants, who sell such goods as cowboy hats and ostrich-skin boots.

On the strip is a clothing store called Tres Hermanos, the same name as a nationally known chain of shoe stores in Mexico. The store, which also uses the same red, white and green logo, is owned by brothers from Lebanon. They have 25 branches across Southern California, all selling to Mexican immigrants.

These entrepreneurs meet a need unfilled by the largest Mexican companies, which, despite broad name recognition and capital, haven't dared enter the intensely competitive Southern California market. Only two nationally known Mexican retailers Gigante supermarkets and Famsa furniture have opened stores here.

Most Mexican immigrants, meanwhile unlike many Asian and Middle Eastern immigrants come here with little education and virtually no business experience. Many are here illegally. They are from a country where the ruling political party spent decades demonizing entrepreneurs and where banks cater only to the wealthy.

"I think that the regular Mexican guy, he just wants to work," said Ralph Hauser, a Mexican American music promoter in Pico Rivera. "They don't want to take a risk. They want to come to work, make $300, send it back to Mexico, with the idea of eventually going back someday."

Those who do start businesses often want them to grow only large enough to employ family members.

"They start a business, but then they're afraid to try something big," said Jose Luis Solorzano, owner of Paramount-based Calzada Diana, which distributes shoes and clothing nationwide.

"I think people say, 'I have this little business. I'll just do this. If I do something else I might lose everything.' "

Thousands of local Mexicans have small businesses that serve their compatriots: bakeries, markets, restaurants, clothing shops and record stores. Mexican immigrants also own several large independent supermarket chains, Northgate Gonzalez, El Tapatio and Vallarta among them.

The Long Beach-based record label Cintas Acuario is owned by Pedro Rivera, an immigrant from Sonora. He has built a music empire on narcocorridos, ballads about Mexican drug smugglers. Fernando Lopez Mateos, an immigrant from the Mexican state of Oaxaca, has based a growing business empire on memories of home: two Oaxacan restaurants, an Oaxacan-oriented newspaper and a multibranch money-wire service.

Yet these are more the exception than the rule, which seems to be: Immigrants from elsewhere mine the potential of one of the world's wealthiest Mexican consumer markets more effectively than Mexicans themselves.

One high-profile example of non-Mexicans filling the void is Plaza Mexico. Situated on Long Beach Boulevard and the 105 Freeway in Lynwood, Plaza Mexico attempts to replicate a traditional Mexican downtown in a strip mall formerly anchored by a Montgomery Ward department store.

The plaza resembles Monte Alban, the ancient Indian ruins in Oaxaca. Its shops have the bold colors of a typical provincial town, and there is a shrine to the Virgin of Guadalupe.

The plaza's clock tower replicates the facade of the government palace in Guadalajara. The stone and the lamps that light the plaza are imported from Mexico. Even the tiles on the plaza contain occasional figures from loteria, a Mexican children's game.

The governor of the state of Nayarit donated a statue in honor of Mexican mothers that stands at one end of the plaza. And other Mexican governors make appearances there when visiting Southern California.

Plaza Mexico's developer is Donald Chae, a Korean immigrant who has labored to make his shopping center distinctly Mexican in the same way Chinatown is distinctly Chinese. He hired Luis Felipe Nieto, an archeologist and restoration expert from San Miguel Allende, Guanajuato, to advise on Mexican designs and colors.

Korean immigrants like Chae dominate even at Southern California's ubiquitous indoor swap meets, where they can be found picking up a little Spanish as they sell cowboy belts from Jalisco, Brown Pride T-shirts and pictures of the Virgin of Guadalupe.

Learning to sell to Mexican immigrants is fairly easy, say vendors.

"You see what people are wearing and go from there," said John Kim, who, with his fiancee, helps run a jewelry stand in the Western Pico Indoor Swap Meet. "You have to be aware of what sells and what people want."

Holcomb, the Mexican festival organizer, learned his business at an indoor swap meet.

Just out of college, Holcomb was hired in 1991 to promote the Anaheim Indoor Marketplace in a former White Front department store. At the time, the swap meet was a sleepy venue of two dozen vendors selling arts and crafts, mostly to English-speaking customers.

Holcomb knew nothing of marketing to Latinos or much about the local demographics. He was in Orange County, so to attract weekend crowds, he figured he could hire country bands to play.

"Nobody would ever show up," he said. Then he spent $300 on a mariachi band, he said, "and everybody in Anaheim came."

Holcomb saw an opportunity and began holding Mexican-style carnivals throughout Southern California.

Although Holcomb has so far kept the carnival business to himself, competition is growing on other fronts as entrepreneurs discover the lesson Holcomb says he has discovered about Latinos:

"They have a lot of spending power, and they're not afraid to spend their money."