You'll find little evidence of an economic downturn in the revenue figures for this year's HISPANIC BUSINESS 500. It was another record-breaking performance for the largest Hispanic companies in the United States, with total revenues totaling $21.18 billion. That performance – a 12.7 percent increase over the previous year – caps off a tremendous 10-year run that has increased revenues 134 percent for the HISPANIC BUSINESS 500.
Comparison of the directories from 1991 to this year shows Hispanic-owned businesses participating more fully in the mainstream economy, a trend that accelerated during the course of the 1990s. "Hispanic companies have only started to scratch the surface of their potential," comments Joel-Tomas Citron, CEO of MasTec Inc., the top company on the HISPANIC BUSINESS 500. "If you were to look at the list in 2011, I think you would be baffled at the size of the companies and the magnitude and diversity of the types of industries they're in, and the impact they will have on the overall economy."
Rebecca Morales, an economic consultant and former researcher at Claremont Graduate School in California, cites Goya Foods – the number 3 company on this year's directory – as a prime example of how a company grows by acculturation and assimilation. Goya began marketing its products to U.S. Hispanics in bodegas and selected grocery stores before expanding to national distribution through major supermarket chains.
"The things that we start for our own population are becoming increasingly attractive to the broad population, and we now have the assets to expand," says Ms. Morales. "It doesn't have to be strictly focused on our population, but that's a very good entree."
Hispanic food, business services, and auto-related businesses provide an easier crossover into the mainstream economy since "people can interact with the Latino community easily and progress into the broad community through these industries," explains Ms. Morales. Such companies clearly have risen to the top of the HISPANIC BUSINESS 500. Six of the top 20 companies on the list come from the automotive sector, another three from the food sector.
The finance sector epitomizes the inroads of the HISPANIC BUSINESS 500 over the last 10 years. In 1991, eight finance companies made the list, with combined revenues of $351 million. Those figure seem rather small compared to this year's list, which includes 16 finance companies with combined revenues of more than $1 billion.
Within the finance sector, Hispanic real estate companies have grown in step with the housing market over the last decade. Together with the construction sector, always a large share of the HISPANIC BUSINESS 500, Hispanic financiers have moved aggressively into the mortgage and building loan sectors.
"Not only do South Americans see Miami as a center, but all these immigrants from Central America, Cuba, and everywhere else are becoming richer," explains Jorge Perez, CEO of The Related Group of Florida, a developer of upscale condos and mixed-use projects. "In other words, we are seeing growth not only in Hispanic population, but in Hispanic wealth. Our company is well positioned to take advantage of that."
Economic downturns usually batter the real estate business, but Mr. Perez says South Florida has "a fairly decent market – as opposed to a very strong market over the last few years." He has seven construction projects lined up for the next year or two, but he suspects smaller Hispanic-owned firms will feel the crunch more than his firm, which ranks number 5 on the HISPANIC BUSINESS 500, with revenues of $506 million.
Besides finance, two industries – health care and high technology – crowded the top echelon of HISPANIC BUSINESS 500 companies during the 1990s. In 1991, food retailers and car dealers accounted for most of the 12 largest firms on the list. The biggest service company was CareFlorida at number 28. Today, the retail sector has declined on the list overall, dropping from 56 companies to 30 and now accounting for only 5.5 percent of total revenues. Health care has surged, with Florida-based Pan American Hospitals and California-based Molina Healthcare both among the top 12 companies.
On the high-tech front, MasTec's climb to the top of the HISPANIC BUSINESS 500 illustrates the evolution of the U.S. economy and how Hispanic-owned companies have adapted.
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