Mission Accomplished

Tops in tortilla sales in the United States. Extensive and innovative, growing menu of products. Multinational ventures, including product entries into Europe and feelers into Asia. The list of accomplishments that Mission Foods has racked up is extensive. But if you thought those “missions” were impossible, consider the Irving, Texas-based company’s latest goal:
“We are focusing less on initiatives, but emphasizing perfect execution,” says Jairo Senise, president of Mission Foods. “You do less, but you do [it] well.”
All that while pursuing innovation, improving customer service and product quality and training employees well?
If it sounds like an impossible mission, neither Senise nor his company seems fazed by the challenge.
“That’s the recipe for success,” Senise says.
Thus far, Mission Foods, Snack Food & Wholesale Bakery’s 2004 Wholesale Baker of the Year, has followed the recipe book to a “T” and produced some sweet results. The company, which was founded in 1977 in Canoga Park, Calif., and moved to Commerce, Calif., before landing in Irving in 1998, is the No. 1 producer of tortillas in the United States. And now, it believes that if it can incorporate “perfect execution” into all elements — production, marketing, sales, etc. — more growth is imminent.
So far, it’s paying off. While the U.S. baking industry is struggling with soft sales and the impact of fad diets, Mission Foods is experiencing solid growth in the sales of its products. In fact, it’s one of the top-performing divisions for its parent company, Gruma S.A. de C.V., headquartered in Monterrey, Mexico.
For the fiscal year ended Dec. 31, 2003, net sales for Gruma S.A. de C.V. rose 12% to $2.03 billion while sales for Gruma USA grew at a 12% rate to $985.9 million. Gruma USA, which includes Mission Foods and Azteca Milling L.P., accounts for nearly half of its parent company’s sales.
Gruma Corp.’s sales increase was sparked by a 13% rise in corn flour tortilla volume and a 5% gain in wheat flour tortilla volume, according to A.C. Nielsen. Despite being one of the top distributors of tortillas, Mission Foods’ executives know that the company cannot sit back. Therefore, it continues to reinvent itself through improved customer service and innovative new products.
“This is a constantly developing company, and [new products are] a big priority for us,” Senise says. “We have to wait until the windows [open] to introduce those new products to our customers, … but they are coming in waves, and you’ll see very soon other initiatives from our company.”
Those waves of products would add to Mission and Guerrero lines that already include products as recognized and simple as corn and flour tortillas and tortilla chips and as specialized as flavored wraps and guacamole dip.
Mission Foods covers two main brands, Mission and Guerrero. The Mission brand caters more to the non-Hispanic consumers throughout the United States, and is the focus of expansion of the company into the Northeast and Midwest regions. The Guerrero brand is geared toward the rapidly expanding Mexican Hispanic market and is more developed in the West and Southwest regions of the country, but is expanding to emerging Mexican areas like the Southeast.
Yet another way in which Mission Foods recently reinvented itself is by adjusting its regional coverage in order to focus its efforts better, according to Senise.
“Before, we covered the country in three different divisions,” he says. “Now we have six different divisions, which means people will have more time for the customers.”
Geographic expansion is also important to the company, which sees plenty of room to grow in the Midwest and Northeast sectors of the United States.
That’s a Wrap
Tortilla consumption has yet to really take off in the Northeast like it has in other areas of the nation. But traditionally non-Hispanic items, specifically wraps, are opening doors in that region. As Asima Syed, Mission Foods senior vice president of marketing, explains, “Mexican food isn’t as highly penetrated [in the Northeast], so wraps are another great way to bring people into the tortilla category.”
Initially, Mission Foods had introduced its wraps six years ago. Despite their popularity in the foodservice channel, they didn’t do so well in the retail market, Syed says, partly because of a lack of familiarity.
“Consumers didn’t really have as good an idea of what to do with them as they do today,” she says, “because now they’ve been exposed to those uses across many different foodservice channels, from quick-food service to sandwich places to casual-dining restaurants.”
Mission Foods relaunched the wraps in January of 2004, and Syed says the company has seen them grow since then. Its product line has expanded to include flavored varieties such as Zesty Garlic Herb and Sundried Tomato Basil.
In the foodservice channel, wheat flour tortillas account for the bulk of sales. Here, promoting its products involves both education and innovation. Mission Foods goes to great lengths to educate operators on how to use tortillas properly. Robert Smith, senior vice president/general manager of foodservice, says leveraging its expertise about tortillas and Mexican foods in general is one key to success in the foodservice channel.
“It’s hard to teach a Mexican restaurant — independent or chain — how to use tortillas more than they already do,” Smith explains. “They’re already the experts at doing that. So our growth has come from teaching and showing operators new and different innovative ways to put tortillas on their menus in non-traditional ways.”
The foodservice sector continues to experience solid growth mostly because of the introduction of more Mexican-style items on the menus of what Smith calls “quick-casual” dining establishments.
Moreover, Mission Foods has broadened its customer base by targeting a diverse array of restaurants to add tortillas to the mix.
“We’ve even worked with pizza chains, for example, on how to put tortillas in application in pizza operations,” Smith says. “Everybody has nachos. They’re like buffalo wings — everyone’s got them. But what else can you put on your menu? You can use a tortilla as an appetizer or shared dessert item, things of that nature. And that’s what our chefs have been working with, creating opportunities for operators and offer up something different.” That’s where the innovation comes in. Mission Foods offers culinary assistance to foodservice operators in many creative forms. The company relies on three chefs who work on an associated basis and also offers menu evaluations and ideation sessions.
 “We can basically provide them with a service that builds a menu item from zero all the way to final pricing,” he says.
Mission Foods’ Web site also offers 400 to 500 recipes that are scaleable and searchable, so a restaurant operator can go in, determine what ingredients they’d like to use, find dishes that fit that scope and even calculate the quantity of ingredients they’ll need to provide a certain amount of servings per week.
Operators and consumers alike can find online the recipe for such dishes as the Meatless Tortilla Lasagna (made with tortillas instead of lasagna noodles), the Snickerito (a Snickers bar wrapped in a tortilla and garnished with ice cream and chocolate syrup) and several versions of tortilla pizzas.
Basically, it boils down to giving foodservice operators convenience and quality, Smith says.
A Kitchen’s Aide
Another popular convenience item in foodservice is precut, unfried chips, which take one step out of the hands of the restaurant employees.
Typically, restaurants that fry their own tortilla chips would have to take corn tortillas specifically designed for frying, cut them up and fry them. But Mission Foods’ multi-color, precut chips give the restaurateur a bit of a helping hand.
“If we can help a restaurant operator take knives out of the hands of their employees, we help reduce potential problems or injuries in their kitchens,” Smith explains. “We can offer them a precut, unfried chip, and then someone doesn’t have to be standing there with a knife cutting tortillas and potentially hurting themselves.”
There is opportunity for further growth in foodservice, both through addressing the needs of operators and expansion into new fields. Smith says Mission Foods is starting to make small inroads into the in-store bakery/deli market, but the company has to assess whether or not it would be of help to each individual chain.
Whatever the focus of foodservice expansion, Smith says the key is to go directly to the operators. Mission Foods’ national sales force concentrates mostly on the operators themselves, although a national-accounts group focuses specifically on the large restaurant chains.
“If they’re going to buy a tortilla, we want them to specify Mission from their respective distributor,” Smith says, “and the way the sales people promote that is by pushing Mission’s service quality and product quality, consistency and dependability.”
All Hail Retail
In retail sales, it is not wraps or tortilla chips that are the most popular, although Mission Foods’ tortilla chip business has been growing nicely over the last few years. It’s the traditional 6-in. corn flour tortillas and 6- and 8-in. wheat flour tortillas that sell best.
“Products [are] different because in foodservice they tend to have to make the product to the customers’ specs,” explains Mike Crane, vice president of retail sales.
The overall company strategy of “perfect execution” extends to retail as well. Crane says, aside from geographic expansion, growth can come through the retail channels if the distributors work on getting “better execution.”
“When you do a promotional activity or when you do a consumer event, you need to get displays,” he says. “Whether it’s a consumer event put together by a marketing group or a trade event put together by the customer, it’s just better retail execution at the store [that’s needed].”
Crane agrees that geographic expansion is the biggest growth vehicle ahead for Mission Foods, particularly into the Northeast sector of the country, where most tortillas are sold in the refrigerated section nowadays. But that, Crane adds, should change as tortilla companies really move into these areas.
“Our competitors just started coming into the market up there, but they’re not coming into the market refrigerated, they’re coming in to the fresh aisle,” he explains. “Our plan will be that we will have a fresh tortilla up there that will be delivered from a plant nearby, not a long shelf-life product.”
In the retail channel, it’s a delicate balancing act to keep distributors and customers happy. Mission Foods has been able to keep from falling into the depths because of excellent foresight and execution in the customer-service realm.
“Customer service in the grocery industry is crucial, because the accounts want to carry as little inventory as possible, because they’re all in a money crunch,” Crane explains. “And we as a corporation must have on-time deliveries to meet the customers’ needs.”
In some cases, customer service involves putting manpower on key accounts. In other cases, Mission Foods relies on computer software that monitors distribution using real-time data to ensure that its customers get what they ordered.
Keeping the distributors happy is no walk in the park for Mission Foods. But it has succeeded where others might have failed because it gears its strategies to distributor needs.
Mission Foods has two different kinds of route systems in the retail channel. More than 1,500 independent distributors carry Mission- and Guerrero-branded products, and in the Los Angeles area, there are more than 100 company routes. Each type of route requires a different kind of management style. Also, the motivation differs.
“The incentives are different for an independent distributor because he is his own business person, and the company routes are based on a salary,” Crane says.
Next in Line
“Some people think of [tortillas] as commodities,” Syed says. “But the consumer doesn’t choose to look at it that way, particularly the Hispanic mom that’s doing most of the purchasing of tortillas for her family. She’s very concerned about maintaining the essence of her culture through food and is also interested in taking the best possible care of her family. … She’s never going to sacrifice as much as the general-market consumer is in order to get convenience. She wants a product that she can depend on week-in and week-out.”
Maintaining that essence is what drove Mission Foods to introduce authentic gorditas as part of its line of products within the past year. Authentic gorditas, unlike the pita/taco hybrid sold at some restaurant chains, are thick corn disks that puff up when they are cooked and are stuffed with fillings. They are a very authentic Mexican food, but until Mission Foods discovered a way to manufacture and package them, it was a delicacy that had to be made from scratch or bought at a restaurant. As such, demand has been high, and Syed says the gorditas were one of Mission Foods’ top 10 stock keeping units (SKUs) in its first six months on the market.
Another authentic product introduced recently was Guerrero “Fresqui-Ricas” tortillas. Mission Foods was looking to accelerate its growth in the flour-tortilla category when it came upon the idea for a ready-to-cook tortilla that did not need refrigeration. This category did exist prior to Mission Foods’ entry into it, but it was a very, very small and very local category, Syed says.
“All of those products were refrigerated,” she notes, “had very short shelf-lives and were not all that convenient to use because they were refrigerated, so they would get stiff and hard and be hard to peel apart.”
Mission Foods then put to work its knowledge of the consumers it was trying to reach and created a product they believe meets those needs.
“The big innovation [with Fresqui-Ricas] is that these are shelf-stable,” Syed explains. “They are not refrigerated so they can be merchandised where other tortillas are merchandised, and we bring them fresh to the store just like all of our other products.”
One of Mission Foods’ latest accomplishments was the “Great New Taste” corn-products launch almost two years ago. In essence, Mission Foods reformulated its corn tortillas so that they tasted better and were softer. By doing so, it took the commodity-positioned corn tortillas and gave them enhanced value. Mission now positions them as the preferred product in this competitive market.
Reformulating the corn tortilla was easier said than done. The successful venture came about based heavily upon consumer demand and studying consumer needs.
“There are a couple of different clusters in corn-tortilla preference among Hispanic consumers,” Syed explains. “What we did that was unique was, we built a bridge product that could please both segments that had very different preferences. We discovered that we could build a product that would appeal to both those groups.”
That product, the “Great New Taste,” has produced significant dollar and pound growth over the past two years, according to Syed.
Mission Foods has used all sorts of media to promote the authenticity of its products, from TV and radio commercials to advertisements in local newspapers. Even the advertising of each product is tailored to the specific market but with an overall theme of authenticity. The “Great New Taste” launch is a good example of the balance Mission Foods struck with the promotions.
“We had different positionings against the slightly different formulations we had on those products,” Syed says. “The Mission side, it was ‘With the Great Taste of Corn.’ Guerrero had a different positioning of ‘More Like Homemade.’ So we positioned them more according to the consumer base.”
That brand positioning and knowledge of the consumers’ needs extended to Mission Foods’ strategy for entering the low-carb fray. Mission Foods did not rush to market with its low-carb product because the company wanted to produce a high-quality, low-carb item, one that would blow away the competition. Once that goal was achieved, the product was launched behind an advertising campaign based directly on consumer input.
“When we talked to consumers in focus groups, they told us their belief was that some low-carb products tasted like cardboard,” Syed says. “So we had some fun comparing a dish made with tortillas to a dish made with other products that may not have the same great taste. So our tagline for that was, ‘Lower Your Carbs, Not Your Expectations.’” And consumers have responded, Syed says, with low-carb growing steadily now that early supply issues have been remedied.
One Step Ahead
So what’s next? Other than growing geographically, Mission Foods plans to take what it has learned about the tortilla consumer and build its product line around that knowledge, much like it has done in the last few years.
“We believe our knowledge is unparalleled in terms of the amount of consumer-research dollars we spend and the amount of time we spend with consumers and focus groups,” Syed says.
Overall, Mission Foods has found success because it has listened to consumers, balanced its strategies toward different markets and found new ways to grow while expanding those boundaries geographically.
If Mission Foods can take what it has learned during its rise to the top, continue to learn and innovate and successfully combine that knowledge with the “perfect execution” strategy and what Senise calls an “internal desire and strategy to be the best,” then there is no telling what successes await the company.
“We want to be considered the preferred supplier and the preferred product because of our quality,” Senise explains.
Given the company’s track record and the framework in place, no one should be surprised if those missions are the next to be accomplished.
The Happiest Tortilla
Factory on Earth
It’s a business relationship that would bring a big smile to the face of Eeyore, Winnie the Pooh’s perpetually gloomy donkey friend.
When The Walt Disney Co. approached Mission Foods, originally a California-based company, about joining Disney’s California Adventure theme park, the Irving, Texas-based tortilla manufacturer didn’t have to be asked twice. Not only did the partnership seem to be a great brand-awareness possibility, but it also was a perfect opportunity to drum up general market interest in tortilla consumption that would benefit the tortilla category in general. It almost was Mission Foods’ duty to take the challenge as one of the national leaders in tortilla production, according to Asima Syed, Mission Foods’ senior vice president of marketing.
“When you get to be a successful company, you’re responsible in the retailers’ eyes for growing the category, pushing category growth and educating the consumer base on a national level,” Syed says.
The Mission Tortilla Factory at Disney’s California Adventure theme park was opened in February of 2001 and has been churning out tortillas, spreading knowledge about tortillas and generating additional name recognition for Mission Foods among consumers.
The factory features a seven-minute walk-through tour of a working tortilla line, staffed by Mission Foods employees and Disney cast members. It is located smack-dab in the middle of one of the best-known entertainment venues in the world — the Disneyland Resort, which touts itself as “The Happiest Place on Earth.”
Visitors to the mini-plant get a detailed look at the tortilla-manufacturing process, as well as a free, fresh-from-the-oven tortilla at the end of the tour. When consumers leave the factory, they have the Mission brand fresh on their minds.
“It actually compares very favorably in cost to traditional sampling methods,” Syed said. “But the advantage is that you get a 20-times-more impactful sampling experience. … We have research that shows that people recognize after they’ve been through this experience that it was a Mission tortilla they were tasting, which is the best you can have in terms of advertising awareness.”
Part of what makes the experience so impressive upon visitors is that Disney and Mission Foods made the line very visual. An introductory video teaches consumers about the history of tortillas and tortilla production. Guests then see the line in action. After the tour, Mission Foods offers a special cooking demonstration and recipe cards, giving guests up-front knowledge that they can apply in their own kitchens using tortillas.
The two tortilla lines resemble something straight out of the Disney movie “Honey, I Shrunk the Kids.” At 32- and 35-ft. long, they are miniaturized versions of Mission Foods’ full-scale lines, custom-made by Tecnomaiz, the sister company that manufactures the full-scale lines. Also modified for the tour was the tortilla oven, from which the stainless-steel side was removed and replaced with heat-resistant Plexiglas so visitors could see the tortillas cooking and puffing when ready. Each line can produce 18-30 tortillas per minute, depending on demand, compared to thousands per minute in the company’s full-scale operations.
That scaled-down production is enough, however, since the tortillas never leave the Disneyland Resort. Although not every tortilla produced is sampled, the leftover tortillas aren’t tossed in the trash either. They are distributed throughout the restaurants and hotels of the resort, including the Cocina Cucamonga Mexican Grill, which is located next door and also hosted by Mission Foods. Anywhere they go in Disneyland, guests can eat a fresh Mission tortilla from the factory.
During a typical day, both Mission Foods and Disney employees work the lines and educate and guide guests through the tour. One line produces flour tortillas and the other produces corn tortillas, with operation switching between the two throughout the day, giving visitors a reason to come back and try another tortilla.
The factory’s operations are held not only to the standards of Mission Foods’ “perfect execution” plan, but to the standards set by Disney. Simply being involved with a Disney production requires a certain amount of focus on detail, but the benefits of being allied with Disney are bountiful.
“It’s in an environment where, frankly, if you’re in a Disney theme park, the quality has to be there,” Syed said. “(and) you definitely have the Disney imagery that supports your brand.”
Earning Disney’s trust as a business partner has other perks, too. Currently, Disney and Mission Foods are partnering to promote the new “Twilight Zone Tower of Terror” attraction at California Adventure. Mission Foods is promoting the attraction through retail displays featuring Mission products and offering a chance to win a trip to the theme park. It’s a nationwide program that is bolstered by the power of the Mission and Disney brands.
The partnership with Disney allows Mission Foods to showcase itself to more than a million people per year via the Mission Tortilla Factory. Appealing to the consumer’s curiosity about how tortillas are made and using the promotional powerhouse of “The Happiest Place on Earth” put Mission Foods in a perfect spot in the minds of the visitors to the factory — front and center in the tortilla business.
That’s a bit of Disney magic most companies would love to have working for them.
Gruma Around the World
For one of the world’s largest tortilla manufacturers, the purchase of Ovis Boske, a Dutch company with $18 million in annual sales, was considered a significant acquisition because it strengthened the company’s presence in Europe.
The Netherlands-based company produces tortillas, wraps, pitas, Swedish flatbreads and other grain-based foods, which are distributed throughout the continent, including France, Belgium, Scandinavia and elsewhere.
For Gruma, expanding throughout Europe is integral to its global growth. Previously, the company had been serving the continent from its plant in the United Kingdom, where the selling of tortillas has been both an educational and marketing process. Unlike in the United States, Mexican cuisine is more of a novelty in this part of the world.
“This is our fourth year [serving Europe], and we are right on target in terms of our plans, and that makes us very happy,” says Jairo Senise, president of Gruma Corp., a subsidiary of its Monterrey, Mexico-based parent company.
The market is growing double-digits in Europe. However, for most of our products in Europe, we have to teach Europeans how to use them. We are doing this through foodservice and institutional customers.”
In the U.K., for instance, sandwich-oriented consumers use tortillas more of a wrap than for Mexican foods. On the mainland, tortillas are being incorporated into each nation’s cuisine.
“The Europeans are a little more formal in the way they eat,” Senise says, “but they are discovering that the food is fun and creative. You can prepare anything you want with a tortilla.”
The European operation is just a small part of Gruma, a vertically-integrated company that does business also in the U.S., Mexico, Venezuela and Central America. In fiscal 2003, U.S. and Europe accounted for 49% of Gruma’s sales, Mexico comprised 32%, Venezuela made up 14% and Central America made up 5%.
In addition to its core business of tortillas and other Mexican foods, the company produces canned foods, snacks, hearts of palm, rice and other products throughout the world. Moreover, its milling operations supply its bakery facilities with corn and wheat flour while its Tecnomaiz subsidiary produces tortilla-making systems that can produce up to 1,200 items per minute.
However, Gruma is not done expanding globally. In August, its top officials traveled to China to evaluate the possibility of entering the Asian market.
“We are going to check the opportunities in that area,” Senise says. “Everything is new. Like we did in Europe, we have to make sure that, if there is a market there, we will be there.”