According to Jim English, chief financial officer for Lopez Foods Inc. of Oklahoma City, the company’s prospects are closely tied to those of McDonald’s. More than 90 percent of Lopez Foods’ sales come from the fast-food giant. Lopez Foods, purchased by CEO John Lopez in 1991, reported a 14 percent increase in export sales between 1999 and 2000, much of it attributed to McDonald’s expansion overseas.
Exports account for about 3 percent of the company’s revenues. Lopez Foods products are exported to Mexico and Puerto Rico, and the company has a plant in Guatemala. Its largest foreign destination, however, is Hong Kong, which imports sausage patties.
Mr. English does not anticipate a drop in business because of the terrorist attacks in the United States. “I don’t think it really affects the food business much at all, because people have to eat,” he says. “Sometimes companies like McDonald’s do better in bad times.”
Companies that are known to place a high premium on food safety and quality give customers a feeling of security about what they’re consuming, according to Mr. English, and grocery stores, fast-food outlets, and bargain stores such as Wal-Mart generally hold up well in difficult times.
The health-care industry also is generally immune to economic downturns, says Carlos M. de Cespedes, chief executive officer and chairman of Pharmed Group Corp., number 2 on the Top 50 Exporters list. Pharmed, formed in the early 1980s to supply antibiotics and other medical supplies to Latin American physicians, reported export sales of $64 million last year, a 68 percent increase from $38 million the year before.
Mr. de Cespedes calls the health-care industry “recession proof,” pointing out that his business would do well even in the case of war. “As sad as it sounds, it might even be better,” he says. Hospitals from Florida to Brazil stay busy regardless of prevailing economic conditions, he adds.
To provide better customer service, Pharmed has set up offices and warehouses in Panama, Costa Rica, Brazil, and Puerto Rico, and that has led to changes in buyers’ expectations, he says. Pharmed, which keeps $11 million in inventory in its Miami warehouse, can fill an order in two to three days rather than the three to eight weeks needed by major U.S. competitors.
Improved service and the introduction of a new olive oil–based nutritional supplement known as Oleomed have led the company to record sales, says Mr. de Cespedes, who predicts this year’s sales will top $100 million. He says cash management remains a barrier to increased export sales for Pharmed, since the privately owned company doesn’t always buy in the quantities it would like. Johnson & Johnson, a major supplier for Pharmed, demands payment for its products within 30 days, while Pharmed considers itself fortunate to receive its payments within 45 days.
“I’m in the middle and getting stretched from both sides,” Mr. de Cespedes complains. “Managing that in a growth stretch like we’ve had in the last two years is not a piece of cake.”
Top 50 Exporter Methodology
Research Supervisor J. Tabin Cosio and Research Assistant Michael Caplinger gathered data for the Top 50 Exporter directory from the HISPANIC BUSINESS Company Profile form, which appeared in the magazine’s December 2000 issue. Company Profile forms also were mailed to more than 14,000 Hispanic-owned companies in the United States.
Companies included among the Top 50 must show at least 51 percent ownership by Hispanic U.S. citizens and must have headquarters in one of the 50 states or Washington, D.C. Companies must submit revenue figures and indicate what percentage of total revenues come from foreign customers. Nonprofit organizations, advertising and public relations agencies, and companies based in Puerto Rico are not eligible.