Tortilleria La Perla

Tortilleria La Perla

If you’ve tasted even one tortilla in the Twin Cities over the last dozen years, chances are it was made by Tortilleria La Perla. Since 2006, La Perla has been headquartered in a 16,000-square-foot factory in south Minneapolis that’s capable of cranking out 27,600 tortillas an hour. “La Perla means ‘the pearl,’” says Noemi Payan, who founded the company with her husband, Jose, in 1999. “For Mexican people, the tortilla is like a pearl because they eat it at breakfast, lunch, and dinner.”

Tortilleria La Perla’s $3.2 million in annual sales and prominent standing in the local Latino community belie its humble beginnings. The Payans relocated to Minnesota from Chicago in 1994, settling into a one-bedroom apartment on Park Avenue with their five children. As they acclimated, they wondered: Where are the tortillerias? The Payans were forced to drive to a St. Paul supermarket to buy frozen tortillas, a pale substitute for the fresh tortillas they had enjoyed all their lives. Given the growing Latino population in the area, the lack of even one tortilleria—a shop that produces and sells freshly made corn tortillas—was unfathomable.

While Jose, who was raised in Mexico, and Noemi, a native of Puerto Rico, toiled away at low-paying jobs, they began formulating a plan to rectify the tortilleria shortage. After a number of banks turned them away for lack of a professional business plan, Noemi’s networking efforts led to John Flory, then the economic development director for the Whittier Community Development Corporation. “We had been trying to get a loan for almost three years,” Jose recalls. “We had come too far to give up. Once you have a dream, you want to make it come true.”

Flory was impressed with the Payans. “I spent twenty years working with entrepreneurs,” says Flory, who today is special projects director for the Latino Economic Development Center in Minneapolis. “What I look for is entrepreneurial spirit, and I saw that. They had come here and started at the very bottom; Jose was a dishwasher at D’Amico and Sons and eventually worked his way up to kitchen manager at the Wayzata location.”

Ultimately, Marquette Bank agreed to serve as the lead lender in a participation loan with local economic development groups. Flory also steered the Payans to the Mercado Central project, which would open on Bloomington Avenue and Lake Street in August 1999. Tortilleria La Perla proved to be a key anchor in the development, which includes an open market featuring 40 Latino-owned businesses. The Tortilla La Perla menu was simple: fresh corn tortillas, tortilla chips, tostadas, masa (dough for tamales), and two soups popular in Mexico, menudo and pozole.

For that first year and beyond, Jose and Noemi redefined the phrase “work ethic,” showing up at 5 a.m. seven days a week, with their six kids pitching in whenever possible after school. Still, they couldn’t keep up with demand. In 2001, they opened a second location on Payne Avenue in St. Paul (which they closed in September 2011; they opened another location, which is still operating, in 2006). Three years later, it was time to take a giant leap forward in the form of a $1.8 million headquarters in the Seward Industrial Park. “We needed a production and warehouse area and a loading dock.” Jose notes.

While corn tortillas account for roughly 70 percent of Tortilleria La Perla’s revenues, the 45-employee tortilleria also produces flour tortillas, tortilla chips, fried tortilla chips (cut versions of the whole tostadas), and masa. Sales to supermarkets account for a third of the company’s revenues, followed by distributors (another third), restaurants (29 percent), and direct sales to the public (4 percent). The Payans are looking for a distribution company that can help extend their reach beyond Minnesota.

Although revenue at Mercado Central is on a trajectory for a 15 percent drop in 2011, total revenues are on pace for a roughly 4 percent increase. A major financial thorn continues to be the cost of corn, the principal ingredient in the company’s products. “It’s better to raise prices than cut corners,” Jose says. “We’re not going to sacrifice quality.”

Founded: 1999
Locations: 2
Employees: 45
2011 revenue: $3.5 million (est.)