By Eric Peterson | Apr 05, 2015
Brothers Rich Schneider and Raul DeLaTorre are taking over the natural foods niche, one tortilla at a time. Their three-generation manufacturer has tripled in size in the last decade.
Sal DeLaTorre bought the forerunner to Raquelita's, a little Denver bakery and tamale shop, in 1960.
His sons, Rich and Raul, decided they deserved a bump in pay in 1982. "My brother and I came here in 1981 and asked for a $25 a week raise," says Schneider.
Sal did them one better. He told them they were taking over the company. "That's when we learned how little we knew," says Rich.
Three decades later, the brothers know the tortilla business inside and out. Schneider's business card says, "Tortilla Savant." Raul's is more traditional -- he serves as the company's president.
Rich says tortillas weren't hip in the early 1980s, but they are now. "Back then, tortillas weren't cool," says Schneider. "The tortilla ocean we've been in has just expanded."
And in this ever-growing ocean, there are big fish. Well, one big ape. "We have a big, 800-pound gorilla in our industry called Mission Foods," says Schneider. The California-based tortilla giant dominates the mass market.
"We said, "Let's go where they ain't,'" says Schneider. "Where most companies have a standard 10-inch flour tortilla, we've gone everywhere but that. I have 25 flours and grains in my arsenal."
That means experimentation is the Raquelita's norm, he adds. "Steve Jobs and his crew came up with so many things we didn't know we needed. Nobody asked for an iPad."
It follows that Schneider likens Raquelita's to the Apple of wraps. "We've become those guys. I'll never buy a suit off the rack -- I just won't. That's what we are with tortillas."
The company's tortilla-making process of taking dough and pressing, cooking, and cooling it is time-tested, but many of the recipes defy tradition, or, as Schneider puts it, "products you're compelled to try."
A few examples: a whole-wheat tortilla with agave nectar and raisin juice, tomato and spinach wraps, and Nachos Borrachos -- multi-grain tortilla chips made with spent grain from Tommyknocker Brewery in Idaho Springs. "We're too close to Boulder to not have a multi-grain chip," Schneider cracks.
The strategy has paid off. The pivot towards premium and creative tortillas came in 2004, when the company had a dozen employees. That number has tripled in the interceding decade. The company makes over 25,000 pounds of product a day, running double shifts six days a week.
Raquelita's sells primarily to wholesale accounts in 46 states, ultimately supplying a who's who of restaurants in Colorado and beyond with tortillas, wraps, and chips of every size, grain, and hue. Customers include Whole Foods (for its prepared foods), Rio Grande Mexican Restaurants, Elway's, Root Down, Linger, Good Times, and Snooze.
While the company has recently dipped its toes into retail, the focus remains on wholesale. "I just love being able to help these guys," says Schneider. "I've delivered stuff on Christmas."
Raquelita's embraces the sustainably-minded, craft ethic of the natural foods industry, says Schneider. The company introduced a gluten-free tortilla back in 2006, has been wind-powered since '05, and uses largely local and organic ingredients.
It's also unique in that it stone-grinds its Nebraska-grown, non-GMO corn and other grains into flour in-house, whereas almost every single competitor buys flour from suppliers. "No one else is doing it," says Schneider.
The company's nearly anonymous 24,000-square-foot facility on Larimer Street northeast of downtown Denver produces hundreds of thousands of tortillas every day -- the cumulative total is likely in the hundreds of millions since the company moved into the facility in 1974 -- and there's plenty of floor space for more, but property taxes and energy costs are on the rise. The surrounding neighborhood is rapidly becoming a hot residential market.
But Schneider says the long-term plan does not involve relocation. "We've been here so long," he says. "We've been here when this area wasn't cool and tortillas weren't cool. Now tortillas and wraps are cool and the area is cool. I want us to stay here and be able to tell our story."
And that story is at the heart of Raquelita's, he adds. "In our DNA, we're food people, and food is a form of affection."
Challenges: "My challenge right now is taking that leap," says Schneider, and growing the business to a different scale. "You hit that level of growth and what was working for you last year might not work for you this year."
Increasing production is relatively straightforward, he says, but scaling up other skill sets can be trickier. "You can go buy machines, but can you effectively service everyone?"
"Letting people know there's a career path here” is another challenge, Schneider adds.
Opportunities: New products with new grain combinations. "We're getting ready to do some flavors from all continents of the world," says Schneider. "We don't want people to just think of Mexican food."
A second one: "We're being pulled into retail," he says.
Needs: More natural gas. "I'm having to invest in the infrastructure of the building, big time," says Schneider. New fryers and ovens have maxed out the capacity, as have an uptick in residential units in the area. "Natural gas is kind of like DSL," he says. "The more people on, the less everybody has."