Booming business among Hispanic-owned wholesalers drives this year's HISPANIC BUSINESS 500®. The wholesale sector boasted the highest percentage increases in revenue growth, average company revenue growth, and employment growth and has the top company on the list – Brightstar Corp.
The combined 2006 revenues for the 73 companies in the sector jumped to $7.8 billion, which is nearly a 41 percent increase compared to 2005 figures. It makes the segment accountable for 21.5 percent of our list's total revenues.
The sector's average company revenue grew by 31.2 percent, from $81 million in 2005 to nearly $107 million in 2006, which is best among the eight sectors. Employment figures also exploded among wholesalers who returned our surveys. They reported a combined 73 percent increase, from 4,861 employees in 2005 to 8,424 in 2006.
But all the companies in the wholesale sector were simply riding on the coattails of Brightstar, which represents nearly half of the segment's total revenues with its $3.6 billion output. Quirch Foods, a Miami-based food distributor, enjoyed a solid 2006 and earned a No. 11 ranking on our list. But its $453 million in revenues was a distant second in the sector to Brightstar. [See top company profile on Page 30.]
Brightstar CEO R. Marcelo Claure says that while the company is looking to expand worldwide, its growth has been organic. "We have never bought a company in order to grow. I don't like buyouts. I'm a believer that you can build anything from scratch," he says.
Worldwide cell phone consumption trends favor Brightstar's continuing expansion. In 2006, sales in the Asia/Pacific region surged 47 percent over 2005, according to Gartner, Inc., a Stamford, Connecticut-based IT research company. In Latin America, sales increased 16 percent. In Eastern Europe, the Middle and Africa, aggregate sales increased 21 percent. Sales in Western Europe grew 7 percent.
Other wholesale companies continue to prosper despite the rising cost of fuel, commodities, and health and business insurance. At Quirch Foods, health insurance premiums for 500 employees are increasing along with liability insurance costs and fuel expenses for a fleet of 55 refrigerated trucks, says Vice-President Guillermo Quirch Jr. The company is passing on part of the increases to its customers – food retailers in Florida, Atlanta, and Puerto Rico.
Revenues for 2006 totaled $453 million up from $408 million in 2005. Mr. Quirch says revenues will continue to grow in 2007.
Essco Wholesale Electric, based in Chandler, Arizona, thrives as a wholesaler of electric parts in Southern California and Arizona. Revenues will grow 20 to 25 percent in 2007, says President Scott Tonn. The company posted revenues of $171 million in 2006 to reach No. 42 on this year's Hispanic Business 500. Essco has grown without participating in minority set-aside programs, Mr. Tonn says. "We have never utilized them and have grown on a head-to-head basis with non-minority companies. That's very achievable and it's something we are very proud of."
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