Exporters in Mexico tap Hispanic market in U.S.

TRACI CARL, THE ASSOCIATED PRESS

Originally published January 22, 2002

MEXICO CITY -- Carlos Andrade has a secret formula for competing in the cutthroat U.S. beverage market: rice water and tamarind juice.

It might not sound all that spectacular, but Andrade, like other Mexican entrepreneurs, has found a niche in the growing number of U.S. Hispanics craving things from south of the border.

With an annual buying power of $450 billion, Mexicans and other Hispanics living in the United States have become one of the most sought-after consumer groups for Mexican and U.S. businesses, sparking fierce competition between everything from small juice manufacturers to giant entertainment conglomerates.

Many Mexican companies, which often complain they can't compete with U.S. manufacturers, believe they have an advantage when it comes to the 20.6 million Mexicans living in the United States. Their products are reminders of home and bear names many Hispanics trust.

"They are waiting for brands they know and love," said Marco Espinosa, North American promotion director for the Mexican Bank for Foreign Trade.

Building on its powerful brand name in Latin America, Mexico-based Grupo Bimbo, the world's third-largest bread-maker, has focused on acquiring bakeries in states with growing Hispanic populations, including Mrs. Baird's Bakeries in Texas and Four-S Bakeries in California.

Andrade, unable to market small bottles of fruit drinks in the saturated U.S. juice market, found a niche with little competition: horchata, a rice-based drink; tamarind juice; and agua de jamaica, an infusion of hibiscus flowers.

His family's factory on the outskirts of Mexico City already produces the three traditional Mexican drinks for the national market. Now he's selling them in the eastern United States.

"They have money. And they want to buy Mexican products, even if the quality isn't as good or the price is higher," he said of Hispanics in the United States.

Recent Census reports show Hispanics make up 12.5 percent of the U.S. population, a 60 percent increase in a decade. That figure, along with marketing data showing the U.S. Hispanic market is largely underserved, has ignited a bidding war for its attention.

The Olympian Copyright 2002

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