Goya Foods was launched from a small storefront on Duane Street in Lower Manhattan in 1936 by Don Prudencio Unanue and his wife Carolina. From those humble beginnings has transformed into what is now the largest Hispanic food company in the U.S. with about $1.4 billion a year in revenue.
Companies like Goya, today headquartered in Jersey City, typically expand into overseas markets to boost sales, but there are other more strategic reasons for moving into any individual market, according President Bob Unanue and his brother, Peter, who is executive vice president and are the third generation brothers to run the company.
In Spain, for example, where the company has a factory, “It’s economic to pack products there and then ship to places like the U.S.,” says Bob Unanue. “In Puerto Rico [where the company also has facilities], our operations benefitted from Section 936 and other incentives.”
Named after a section of the U.S. tax code, Section 936 generally let Puerto Rican subsidiaries of U.S. corporations remit their local income to their American parents as dividends that were not subject to U.S. corporate income tax, yet were deductible from Puerto Rico’s corporate income tax. The tax break was repealed in 2006.
Even a large company like Goya faces challenges of manufacturing and selling worldwide, according to Peter Unanue.
“There are different rules in different countries, including country-specific labeling requirements,” he said. “The European Union has its own regulations about allowed ingredients, and in some cases we have to change the ingredient mix to comply. It can be expensive, but you do a case-by-case study to ensure it’s worth it.”
Food products like black beans will be slightly different for Brazilian, Cuban and Venezuelan customers, he noted.
“Our formula for the Cuban profile has oregano, cumin and certain spices, while the Venezuelan product has a different taste profile and is marketed under a slightly different name to reflect that. Our products have to be authentic. It’s a competitive advantage,” he said.
Cultural differences in the way the company handles business can crop up too, Peter observed.
“In Mexico, it can be a detriment if you’re not originally from the country, so we deal with distributors because it helps to have someone on the inside,” he said. “But at the same time we have to comply with U.S. rules (such as the Foreign Corrupt Practices Act), while dealing with tariffs and other regulations that favor domestic companies. But if you’re persistent you can overcome obstacles, and the fact that we offer high-quality direct-to-consumer products also helps.”
Goya also polishes its reputation with membership in quality control organizations like BRC Global Standards, a U.K.-based brand and consumer protection organization that sets global benchmarks for food safety, packaging and packaging materials, storage and distribution, consumer products, and other characteristics.
“A top-level BRC rating, in addition to Food and Drug Administration and Department of Agriculture ratings, is recognized by customers and peers,” Peter said. “We also have local quality control employees who put our products — including olive oil —through objective and subjective tests. The final test is taste; like a wine master, they can reject product that doesn’t meet our high standards.”
Goya’s management team also has to keep track of market trends across borders.
“For a long time we sourced nutritious pigeon peas from Puerto Rico, but then the availability, demand and pricing in the Dominican Republic became more competitive,” Peter noted. “So we set up a facility there and began sourcing pigeon peas in the Dominican Republic for the local market and export to the U.S. and Puerto Rico. You’ve got to be flexible and respond to market changes.”
Internally, teams of accountants help Goya keep track of its far-flung finances.
“We work with international accounting firms that have knowledge of tax and other issues here and abroad,” Bob Unanue says. “Also, because we deal with different currencies, we sometimes engage in hedging and other activities to take out some of the currency volatility.”
A worldwide presence also brings added responsibilities, he added.
“We always stand ready to help with programs like Goya Gives, an initiative committed to promoting and supporting the overall well-being of our communities through social responsibility, environmental initiatives and company values,” he said. “We support more than 250 charitable organizations in the U.S. and abroad with cash and products. We do this because we’re part of the global community.”