Now, That's Haute!

Renowned for its thicker, home-style tortillas, Albuquerque Tortilla Co. has emerged as more than just a tortilla company. Its line of authentic New Mexican foods may be ‘the new hot
cuisine’ in more ways than one.

By Dan Malovany

They do things a little bit differently in New Mexico, especially when it comes to food. To spice up a breakfast burrito, they don’t use jalapeños like they do in El Paso, add a little hot sauce like they do in New Orleans or slap on some salsa like they do in Phoenix or Tucson.

    Real New Mexicans perk it up with a flavorful blend of indigenous red or green chiles, and lots of them. In this part of the country, “hot” and “spicy” are relative terms.

    Likewise, the flour tortillas produced by Albuquerque Tortilla Co. aren’t the same as the ones made in Los Angeles or San Antonio.

    First, New Mexican-style flour tortillas are thicker. In fact, a package of a dozen of the company’s 9.5-in. home-style flour tortillas weighs about 26 oz. compared with 18 oz. for a dozen conventional ones.

    Second, these signature tortillas are seared with distinctive toast marks that distinguish them from the competition’s offerings much in the way a red-hot brand does to a bull. It’s been that way since Luther Martinez founded the Albuquerque Tortilla Co. in 1987.

“We were one of the first companies to make thicker tortillas with toast marks. Back then, most tortillas were very thin and very white with no toast marks,” recalls Pete Martinez, Luther’s brother-in-law and current director of operations.

    “We have had people from California come here and say, ‘You’re burning them. You need to speed up the line to get rid of those burn marks,’” he notes. “I would reply, ‘I like those toast marks.’”

    Albuquerque Tortilla Co.’s flour tortillas also contain more moisture and offer greater flexibility, pliability and durability than conventional ones, adds Chris Martinez, Luther’s son and vice president of sales and marketing for the $24 million company.

    “Our tortillas have a silky texture to them,” he explains. “Their texture is fluffy. You’ve have had to have eaten a homemade tortilla before to know what I’m talking about. They’re pretty darn close with their home-style look and taste.”

Millions of Tortillas

Each week, Pete says, Albuquerque Tortilla Co. produces about four million tortillas, or roughly 200 million per year. Flour varieties account for about 75% of volume with the 30-count family pack of 8-in. home-style tortillas as the top seller. The company also produces 8-in. whole wheat, 9.5-in. burrito-size and 6-in. gordita flour tortillas for the retail market.

    Meanwhile, the company’s corn tortillas come in 6-in. white, yellow and blue varieties with the 90-count of white corn tortillas as the most popular. The plant also makes unfried tortilla chips, which are shipped in 25-lb. boxes and cooked at restaurants before they’re served hot to customers.

    Like its flour tortillas, New Mexicans prefer a specific type of corn tortilla that’s different from what is popular in other states.

    “We’re primarily a stone-ground state,” Chris notes. “For our taco shells, corn tortillas and enchiladas, it’s still stone-ground corn. You move next door to El Paso or Phoenix, they’re made with corn flour.”

    To complement its branded business, Albuquerque Tortilla Co. co-packs and produces private label products for a variety of customers. In all, the company makes about 80 SKUs (stock-keeping units) that are sold not only to retail, but also to restaurants, schools and other foodservice outlets.     Retail sales account for the bulk of its business, Chris notes, but foodservice sales have become a larger part of the company’s operation over the last five years and remain a big opportunity in the near future.

    “We have not gone after the foodservice business that much,” Chris says. “We’ve barely tapped into that market.”

    Independent and warehouse distributors ship the products throughout the Southwest, specifically New Mexico, Arizona, Nevada, Utah, parts of Texas and soon in Southern California. Locally, some establishments might get shipments of the still-warm tortillas three or four times a day, seven days a week. Typically, the products have a seven-day shelf life in local markets or a 21-day shelf life for more distant or small markets.

    “At one point, we had our own routes,” Chris notes. “But we figured the way to go was to concentrate on one thing and do that well, and that would be manufacturing. There are enough challenges with the manufacturing part of our business without having to worry about distribution as well.”

More Than Just Tortillas

But don’t let the Albuquerque Tortilla Co. name be misleading. In addition to millions of tortillas, the company has been making a wide variety of prepared foods and frozen entrees.

    “One day, Pete said, ‘You know, we’re not just a tortilla company anymore,’” Chris recalls.

And the company’s new slogan was born on the spot.

    “I said, ‘We aren’t because we are doing so many other different items and so many other things as well,’” Chris says. “I still think there is room for us to grow in the tortilla market.”

    Today, Albuquerque Tortilla Co.’s frozen food sales include its top-selling tamale, burritos, enchilidas and other New Mexican-style foods as well as salsa, spices, chile sauces, seasoned meat and other items to make a meal from scratch.

    In many of the frozen entree offerings, tortillas are featured as the main component or even as the centerpiece of the entree. Presently, prepared foods account for nearly 35% of total sales for the company, but Chris expects that share will grow, especially as it ramps up production in its new 85,000-sq.-ft. operation.

    “Prepared foods seem to be the biggest growing category for Albuquerque Tortilla Co.,” he explains. “With most households being supported by two or more, there is less time to spend giving your family a home-cooked meal. That is one piece of the business that we are focusing on, including healthier lines and [new] packaging that allows prepared meals to either be microwaveable or warmed through a conventional oven.”

    Its Carne Adovada, for instance, is a “heat-and-eat” pork and cheese burrito made with a red chile sauce while the microwaveable breakfast burrito comes with green or red chiles.

    “We are currently producing pork and chicken tamales, individually wrapped burritos, enchilada trays including a club pack, chile rellenos and our staples of red and green chiles,” Chris explains.  “With these lines, we are currently producing more than 30 line items in various sizes and flavors.”

    Most of the new products come from authentic New Mexican recipes developed by the Martinez family and refined through feedback from employees eating at the company’s cafeteria and consumers who dine at test kitchens that actually sell to the public. The moderately priced entrees are made with real pork, chicken, beef, beans or cheese.

    “We are pledging to the consumer that we will offer the highest quality ingredients, [and] the least amount of additives, fillers and preservatives in order to bring the most authentic meals to your table,” Chris says. “I feel this gives us an advantage because we are not trying to be the largest manufacturer in the Hispanic food industry, but only striving to be the best.”

    Moreover, he notes, the frozen meals offer a value-added proposition, especially for consumers with hearty appetites.

    “I’m really confident that our taquitos, for example, will be a really strong item for us,” Chris says. “We’re not going to be selling taquitos that are the size of a pencil. They’re going to be full of good quality beef or chicken.”

    Albuquerque Tortilla Co.’s frozen entrees and prepared foods also aren’t for the feign-hearted. In fact, the company is betting that New Mexican cuisine, or at least a version of it, will be “the next hot thing.”

    “We may have to do different things for different markets,” Chris says. “Our products are unique.  The first time you taste a hot, green chile, it may wake you up a bit. We may have to tone down some things depending on the feedback we get from certain regions of the country.”

    From a distribution perspective, prepared meals provide more bang for the buck because their margins are so much higher than those for tortillas and tortilla chips. For every case of frozen prepared foods, for instance, Albuquerque Tortilla Co. needs to sell four to five cases of tortillas to make the same profit.

It Just Makes Cents

With the relatively high cost of energy and fuel, it’s simple economics that’s driving many tortilla producers to diversify into broad line producers of New Mexican foods.

    “These days, you must maximize your truck from the smallest delivery truck to drop ships in over-the-road trucks to your warehouse customer,” Chris says. “If you are shipping value-added product, which may be $50 to $60 a case compared to a case of tortillas, which may be $15 to $20 a case, you can see the advantage to a company that can diversify its product lines to get the most out of any delivery or drop ship.”

    In addition to broadening its product portfolio, Albuquerque Tortilla Co.’s strategy to diversify its foodservice customer base involves being a one-stop shop. With its food processing facility in place, it can supply everything from raw ingredients such as New Mexican green chile sauce for chefs to already prepared custom-made meals for operators searching for convenience.

    “Whether you are a chef at a large, fine Mexican restaurant who wants to prepare everything from scratch, we can supply you with everything you need, or if you are a smaller restaurant owner who wants to cut out the labor and headaches of all the preparation, we an supply you with everything to fill your kitchen,” Chris says.

    The company also plans to reformulate its products to fit the nutritional profiles for school cafeterias, which have restrictions on the number of calories and amount of fat per serving.

    Meanwhile in the retail market, Albuquerque Tortilla Co. relies on sampling initiatives and in-store demonstrations to promote its brand.

    “The best way to put product in consumers’ mouths is to find a way to get it in their mouths in the first place,” Chris notes. “Demonstrations also make for a stronger relationship with the retailers because a consumer will go in for $50 worth of some products and end up leaving with $100 worth of something else that they tasted or saw a demonstration on. However, you need good people on your team who can talk to consumers and who can relate to the product that they’re demonstrating to get consumers to try it and to get feedback from consumers. The most important part is are we making a product that they like.”

    The latest move to automating its prepared foods production, he stresses, is only a natural evolution for the company that has been producing New Mexican cuisine for 15 years and its signature home-style flour tortillas for more than two decades.

    “We’re not going away from making tortillas because, let’s face it, that’s what we are,” Chris says. “That’s what got us here, but that said, we are looking for new programs.”

    In a state known as “The Land of Enchantment,” they do things a bit differently than the rest of the country. For Albuquerque Tortilla Co., different means doing it better.