Jill Connelly for The New York Times
A food business started by Graciliano Rodriguez, left, is now run by his children, Richard, Angie and Jorge.

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By JAMES FLANIGAN
Published: December 21, 2006
A LONG-TERM consequence of Fidel Castro’s policies in the early 1960s is a thriving Cuban-émigré-owned food processing industry in the Los Angeles area that serves a growing market nationwide for Hispanic foods.
The founders of half a dozen companies that make and distribute beans and rice, specialty groceries, cheeses, coffee and baked goods left Cuba in 1961 and 1962, sometimes through a program called Pedro Pan in which more than 14,000 children were sent to Florida and cared for until their parents could follow.
Miami was crowded at that time with more Cuban immigrants than there were jobs to occupy them, so Catholic Welfare Services and other charitable groups sent some families to California. “We went to Long Beach where there was a house for us to stay in and my dad had a job to go to in the morning,” Jorge Rodriguez recalled. His father, Graciliano Rodriguez, went to work waiting tables in a private club and doing janitorial work on a second job.
But soon the elder Mr. Rodriguez, who had been a wholesaler of potatoes and onions in Havana, found a way to work for himself in food distribution. He opened a store in the Los Angeles produce market dealing in the kinds of beans, rice and peppers that people from Latin America favored. Today, at 91, Mr. Rodriguez still works daily at the warehouse complex in City of Industry, Calif., that serves as headquarters for Mercado Latino Inc., a company run by his sons and daughter that has become one of the largest processors and distributors of Latin groceries and household goods to the nation’s supermarket chains and Wal-Mart Stores.
Similarly, C&F Foods Inc., also based in City of Industry, a 49-year-old industrial city east of Los Angeles, was founded in 1975 by a Cuban émigré, Jose Fernandez. It is run today by his grandson Luis Faura and has become a large processor and distributor of beans favored by Latinos: pinto, black, red and others. Beans have grown in popularity with rising appreciation among consumers for their high-fiber, high-protein health attributes and with the growth of Hispanic populations in all parts of the country.
“We have a distribution center in North Carolina that supplies the Southeast,” Mr. Faura said. “It never was a big market before but now there are people from South America and Mexico and El Salvador in Atlanta and Raleigh and everywhere.”
The list goes on. A Cuban immigrant, Gilbert de Cardenas, started Cacique USA in 1973 and has made it a leading supplier of Mexican-style cheeses. F. Gavina & Sons Inc., named for the Cuban coffee grower Francisco Gavina, has brought robust coffees to supermarkets and McDonald’s restaurants.
But establishing a business in specialty foods is anything but a slam-dunk. Growing Hispanic markets do not offer a free ride to anyone; to succeed demands determination and investment.
At Mercado Latino, for example, the distribution of food and other products changed utterly with the growing abilities of information technology. In the company’s early days, it served as a middleman for products of many food processors, delivering Hispanic foods and offering shelf-stocking and promotional services to retailers. But to growing supermarket chains like Kroger and Safeway, “such middlemen services were an added cost they didn’t want to pay,” said Richard Rodriguez, Mercado’s marketing vice president.
“So,” he said, “our company adapted to directly distributing our own branded products through our own warehouse centers.”
Mercado Latino now has nine centers throughout the Western states for processing and distributing 3,500 products. It employs up to 400 full- and part-time workers depending on seasonal needs and has more than $110 million in annual sales.
“We invested in information technology — you can never spend enough money on that,” Mr. Rodriguez added. He recalled how his father pressed the children in 1975 to buy one of the first I.B.M. System 32 minicomputers to upgrade Mercado Latino’s accounting abilities. “That computer cost more than our company was worth at that time,” Mr. Rodriguez said. But using it allowed the family to take on more products and spread its operations from Texas to the Canadian border.
C&F Foods, meanwhile, has grown to 285 employees and well over $100 million in annual revenue thanks in part to America’s increasing demand for organic produce. “It’s a good business, and the profit is there,” Mr. Faura said. “But you have to be ready to bear the cost of getting into it.”
To qualify as an organic food supplier, he explained, a company needs to invest in more costly fertilizers and new machinery for milling and packing the beans. When the organic food phenomenon took off in 2000 or so, he said, “we debated whether it was a fad or a trend.”
“It took almost $8 million of investment,” Mr. Faura recalled. “But we decided to go for it, and now we have that first-mover advantage.”
Still, with all the growth and promise of Hispanic markets, these companies are relatively small compared with food processing giants like Kraft and ConAgra. Will small entrepreneurs face a difficult future? Not yet, said Jorge Rodriguez, chief financial officer of Mercado Latino. “The big outfits in my opinion are not embracing Latino markets,” he said. “They do a lot and say a lot, but marketing to immigrant consumers, whether Latino or Korean or whatever, you need to know what you’re doing. If black beans are processed and polished too much, they lose their flavor.”
He is saying, of course, that these are still specialty markets. A vendor needs to know not only which products to offer but how the customers like their native foods. In time immigrant specialties will grow into broad American dietary staples: it has been a long time, for example, since pizza was considered a specifically Italian dish.
Being a relatively small family company is no bar to success, Mr. Rodriguez said, “if you know what to do and be good at it.”
Finally, the younger generations of six Southern California Cuban business families, along with 300 other initial shareholders, backed the newly chartered Americas United Bank in Glendale this year. It is the first Hispanic-led bank in 40 years to be chartered in California, said Gilbert Dalmau, a 49-year-old Cuban-American, longtime banker and chairman.
“But don’t stress the Cuban aspect,” Mr. Dalmau said to an interviewer. “This bank is to serve the whole Hispanic community and all the other small-business communities here.”
The Rodriguezes and other families say their parents emigrated from Cuba 45 years ago because they feared for their children’s future. But with hard work and a smart entrepreneurial spirit, the children and their children have made their own futures and brought something new to the whole American economy.

This column about small-business trends in California and the West appears on the third Thursday of every month. E-mail: jamesflanigan@nytimes.com.