From Streets to Shops, Latino Businesses Make Their Economic Mark

This story is part of KCET Departures' series of articles and essays on the Informal Economies of L.A. and how local entrepreneurs create new opportunities outside of formal economic establishments.

And you thought cacao was the drink of the gods. Or beer. Or wine. Whatever your fine choice of beverage is, once you've tasted the sweet-limey, corn-fermented elixir that is tejuino, you will know you are mistaken.

When you sip on the brownish liquid, tasting the rock salt mixed with a smattering of lime sorbet you will drop to your knees with regret for not having known this magic since birth. But before you are able to curse your mother for this criminal oversight, you will be enraptured by the subliminal flavor. Your life will never be the same.

Tejuino certainly changed the life of Marcelo Antonio Reyes, as it has also shaped the lives of his children thereafter.

Their business, Rico Tejuino Los Reyes, is part of Latino's growing role in the economy at both local and national levels. As Latinos have recently become the official majorityin California, with national combined purchasing power of $1.1 trillion, they are also changing how business is done. It only makes sense that someone should cater to their tastes.

The Reyes family literally caters to their taste buds.

You wouldn't think that one could build an entire life and a family legacy on fermented corn. Yet Mr. Reyes and his family have been able to open three successful franchises on a very regional drink with a very particular flavor not typical to the American palate. Not only have they successfully attracted a devoted Mexican immigrant clientele seeking a taste of tradition, but also younger generations of US-born Latinos hungry for new flavors.

Informal Economy

The late hours following the afterschool rush hour give Mr. Reyes' daughter Jackeline Reyes-Nava and her husband Edwin Nava a little bit of time to catch their breath. They take advantage of these quiet moments to chop fruit in the kitchen or to make a dash home to check on their kids. In the four months since opening at their El Monte location, business has been good. Their storefront is small, but festive and professional. Their refrigerators are stocked with fruits, secret sweet, spicy sauces and 16 varieties of homemade ice cream (made by Mr. Reyes himself).

In the mornings they are flooded by men and women ordering juices (green juices for folks on diets or with diabetes), or licuados with avena (oatmeal) for more substantial liquid breakfasts on-the-go. They select from a large illustrated menu covers the northern wall. Its front window wears a county-approved "A" grade, like a medal of honor.

But their greatest marker of pride hangs on the southern wall. It's a framed photo of Jackeline's father as a young man posing with his street cart from which he first sold tejuino.

Their family business has come a long way since the Jackeline's father first took to the streets of East Los Angeles with a single olla (pot) of his homemade brew on a wooden car that he built himself nearly 30 years ago.

Mr. Reyes would set up shop at corners with sometimes with his wife and children as assistants on busy weekends. Jackeline remembers walking alongside her father and his cart, helping him serve customers that flocked from far away corners of the city. She remembers her father's darkly tanned arms as he worked under the sun.

She also remembers that back then, street vending was completely illegal, with no possibility for businesses licenses. "The police would show up and dump his product. Le tiraban todo," she laments. And yet, despite these painful memories, "I was never ashamed. I knew he was a hard worker," says Jackeline.

Mr. Reyes had moved to Los Angeles in search of work to sustain his wife and children, that he'd left behind in Mexico. Soon after his arrival, he found steady construction work that could have earned him enough money to bring his family to the US and build a decent life. This was the 1980's, when working-class Latinos were able to purchase homes throughout Greater L.A. on blue-collar jobs.

Mr. Reyes could have done that.

Instead, he consulted with his father-in-law who offered him unexpected advise. Though Mr. Reyes had been in the US only a few months, hardly enough time to build any capital, he advised him to start his own business. All he needed was their family's special tejuino recipe and perseverance. And his family.

Every time the police confiscated his tejuino, Mr. Reyes immediately went home and cooked up fresh pots of it. The next day, his clientele would be ready to purchase more. Eventually, when business licenses became available for some street vendors, he invested in a more durable, professional metal cart. Then another, and another. Soon, he had three carts operated by his brothers, all selling tejuino made from his treasured family recipe.

It wasn't long before he knew that he was ready to transition from a street vendor with a cart, to a business owner of a brick-and-mortar shop.

Hurdles and Assets

Rico Tejuino Los Reyes opened on Broadway near Workman in Lincoln Heights 25 years ago and continues to serve its signature drink, homemade nieves de garrafa and an astonishing variety of other creative snacks. They have since opened a shop in Oxnard, CA and more recently, the El Monte location, both operated by his two daughters. Mr. Reyes still works out of the original location where he personally makes the tejuino and 16 flavors of ice cream. Several times a week, he drives out to the other two locations to deliver fresh batches.

Of course, Jackeline remembers that transitioning from a street business to an official one was not so easy for her father, at first. "No one in the family had ever had an official business so he had to figure it out on his own," she says. In fact, though Latino-owned businesses have grown over the years, they have struggled to overcome a few significant hurdles. According to a report on small Latino businesses released by Biz2Creditearlier this year, though small business loan applications submitted by Latino entrepreneurs grew 18% in the past year, Latino business owners face significant hurdles in securing financing. They struggle to secure financing, lagging in factors such as annual revenue and credit scores. They also have low operating expenses.On average operating costs for Latino businesses run at $18,334 in contrast to $24,857 for non-Latino businesses.

Nonetheless, Jackelyn's father had three important things: an instinct for business, a supportive family and an already-devoted clientele. Mr. Reyes, like many Latino businesses, has been able to keep his operating costs low, relying on his relatives to run the shops.

Upon opening his business, he quickly realized that man does not live on tejuino alone. He had to diversify. He knew how to make nieve de garrafa, (or barrel ice cream) a typical Mexican homemade ice cream made with fresh fruits and cream. But he needed other things, new ideas to make business more interesting and sustainable. It wasn't long before his loyal customers offered him ideas. Jackeline says, "La gente le daba ideas. They would tell him to add melon, or apples or whatever. When customers make suggestions, we listen. We don't try to charge them extra for changing things." Like Mr. Reyes, his customers were also versed in the vocabulary of Mexico's ever-expanding menu of snacks and treats, all of which have been conceived on the streets, mercados and homes of creative culinary entrepreneurs. Effectively, Mr. Reyes was crowd-sourcing even before crowd-sourcing existed.

Upon popular request, the first addition was the bionico, or the "bionic," a fruit salad dressed in condensed milk or yogurt and topped with granola and shredded coconut. While the rich, sugary dressing makes the bionico more fatty than bionic, it is the Latino community's version of a "healthier" snack (at least healthier than fried pork skins or crema-and-butter slathered corn, for instance).

Customers also requested licuados (milkshakes made of fruit and milk), or jugos (fruit and vegetable juices), like the ones they used to buy from booths from street corner vendors in their hometowns. Or colorful gelatinas or rich flanes made fresh daily by señoras that would sell them on small folding tables right outside their homes.

Now, Mr. Reyes, drawing from a rich tradition of street foods, was able to provide them with these nostalgic treats and introduce them to new Mexican American generations.

In the last 10 years, bionico shops that sell similar treats have sprouted ubiquitously throughout Greater Los Angeles. El Monte, for instance, in addition to mom-and-pop bionico shops, also has a larger chain paleteria La Michoacana that boasts bacon-wrapped hot dogs (another LA street food favorite) to the blasting sounds of cumbia.

But Jackeline and her father don't sweat them. She is confident in her loyal customer base that has come to know them personally for decades and know the quality of their products. "Aqui todo es natural," she says, and assures that she and her father make it a point to sweeten their foods with honey, fruit and the least amount of sugar possible.

A New Generation

Afterschool, waves upon waves of ravenous students en route home crowd into the colorful shop. It's important to keep an eye on this particular consumer base because they are the future. Instead of reaching for traditional treats like tejuino, these youngsters prefer more... creative options. The two items that best represent a new generation of Latino snacks are the chamango and the tostilocos. Chamangos are shaved ice served in a cup, drenched in pureed mango and chamoy sauce. This sculptural item is speared by a plastic straw covered in tamarind and chile candy.

Tostilocos is its own breed, probably a mutation of the nacho family, with Tostitos chips covered in a variation of beans, cheese, cucumber, jicama, cueritos (pickled pork rinds), lime juice and chile sauce. Always lots and lots of chile. Tostilocos join other degenerate snacks such nacho-cheese or Tapatio-drenched Flaming Hot Cheetohs. The limits of snack-innovation seem frighteningly boundless.

And yet Jackeline Reyes has cast her unflinching gaze in that direction. Still in her early thirties, a millennial, business owner and mom, Jackeline is now at the helm of the future of Ricos Tejuinos Los Reyes with her husband Edwin Nava. Like her father, she lends an attentive ear to what her customers want, making customized treats upon request. And she also uses the kitchen as her culinary lab, experimenting boldly to create the next generation of snacks. She prepares cucumbers stuffed with Japanese peanuts and chopped apples, decoratively drizzled with chamoy and Tajin powder which she assembles with artistic flair in a plastic or Styrofoam container.

Mr. Reyes, at 51 years of age and now a grandfather, is satisfied with the growth of his business. He is a home owner and so are his children. "My father is happy with what he has accomplished. He is satisfied." He does not ask for more. However, Jackeline, her husband and her sisters are not ready to settle quite just yet. "Ahora me toca a mi." Now it's her turn to take Ricos Tejuinos Los Reyes to the next level.

Her husband Edwin thinks that Latinos have a lot of entrepreneurial potential, as long as they are ready to make the necessary adjustments. "We have a culture of hard work, but we need to change our vision. We need to break free from restrictive mindsets and bad habits." Edwin thinks that Latinos sometimes do not provide one another with enough support, specifically in the form of resources and capital that are so essential when starting a new business in a new country.

"We need more unity among Latino business owners and families. We are all capable of having our own businesses, but it's important to have a vision, take risks and persevere."

Like many younger generations of Latino entrepreneurs, Jackeline and her husband are looking for ways not just to build on the previous generation's accomplishments, but to innovate their businesses. While she manifests here creative energy in the kitchen with her inventive treats, she is also dreaming up and strategizing her next business move.

For one, she is thinking big. She wants to mass produce the homemade ice creams with the same quality ingredients and care that she and her father put into their nieves. She also wants to expand nationwide and expose new non-Latino consumers to her products.

Recently, La Monarca, a Mexican bakery and café has proven that Latino businesses can simultaneously appeal to new consumers while keeping the traditional consumer base. NPR journalist Saul Gonzales writes that La Monarca owners, Ricardo Cervantes and Alfredo Livas "have a big goal of breaking an unwritten rule in business -- that small business immigrant entrepreneurs do better by sticking to their own communities and not trying to cross ethnic and cultural borders in this country." Although there is certainly some risk in making the leap to new territories, venturing from Boyle Heights and East LA into affluent neighborhoods like Santa Monica, owners Cervantes and Livas (both Stanford-educated MBAs from Monterrey, Mexico) are not, as Gonzales points out "your typical idea of Mexican immigrants trying to make it in the United States."

And though Jackeline was born in Guadalajara, Jalisco to Mr. Marcelo Antonio Reyes, a Mexican immigrant who started his own business pushing a humble wooden cart on the street, neither is she. Like the Stanford MBAs, Jackeline is already thinking even beyond national borders. She plans on expanding Los Reyes all the way back to Mexico. "Many of us come to this side but we don't have to forget about where we're from."

While it has been noted that entrepreneurship in the US can be challenging for many Latinos, they are also adapting quickly, learning the rules of the game and changing them up with their own skills and savvy.