A mechanical engineer by training, after his time at top companies like Bosch, Valeo and Accenture, Omar Ayala saw an opportunity and decided to start his own venture. As a Mexican national living in Central Europe, and given an increasing demand not just for top-quality baked goods, but also imported Mexican foodstuffs, Omar launched www.latortilleria.eu. And he’s got big plans to launch a trading company that services not just central and eastern Europe, but the broader European continent as a whole. IE’s Director for Europe, Joël McConnell (JM) recently caught up with Omar Ayala (OA) at IE Business School’s Madrid Campus to talk about his career post-IE, and his grand plans to establish a trading company that bridges the Atlantic, and that brings top-quality Mexican products to European consumers, hungry for something just a little bit spicier.
JM: Omar, you are from Monterrey (Mexico), how did you end up as the founder of a baked goods company in Prague? What are some of the most helpful skills you picked up during your time at top multinationals that are helping you run a highly competitive company in Central Europe?
OA: I worked in Germany and ended up in Czech Republic working in a special project for Valeo. After eight years of working for big multinational companies, I decided to work as an independent consultant for various start-ups and SME’s, among them a chain of Mexican restaurants in Prague, and this last client is where I got my business idea. What caught my attention was the very high volume of imports of Mexican products being made by just an average-sized restaurant chain in Europe, and after analyzing the costs of manufacturing those products in Czech Republic I found what was to become a very attractive investment project, and so I decided to start up my own factory. For that, I leased a vacant bakery where I could set up my machines to produce Mexican tortillas, and while waiting for the delivery of the machines from Mexico, I negotiated with the bakery owner to be able to use the fully-equipped bakery at a pay-per-use rate, after which I hired a baker with whom we developed recipes of specialized baked goods. Almost immediately the bakery became the fastest growing business, so much so that once I received the machines for Mexican tortillas I already had two employees making bread and one driver for the delivery of my goods. Today I have 11 employees and we continue to grow.
My past life in the automotive industry helped me to effectively organize the production lines of the bakery and tortillas, using the principles of lean manufacturing. Besides the networking done in my previous jobs turn out to be useful to find very good solutions to some of our most costly services we have to pay for, such as sea transport and mechanical maintenance. So while seemingly unrelated, I’ve been able to make good use of some of my most transferable skill-sets in my new venture.
JM: I understand there is something special about the flour used in Mexico to produce La Tortilleria’s Tortilla Taqueras, what is it? What capital investments (and other big risks) did you have to take to get your – now successful and growing – business off the ground? Was finding low-interest rate capital a challenge when getting your business off the ground?
OA: Flour from Mexico is nixtamalized. Nixtamalization is an additional cooking of the corn done with lime before milling in order to remove the “skin” of the corn and make it softer. The corn varieties in Mexico have a particular different quality due to climate, soil and geography, different than in Europe and that makes it special too.
At the start I tried to invest as effectively as possible. I decided to not invest in a very big automatic machine which would bring more capacity than what I actually needed to get started, and so I investeded in a semi-automatic tortilla machine. Then I rented an equipped bakery with a license to operate baked goods and agreed with the owner to just use the license for baking and not his equipment, as I needed just a small space for the machinery and product storage. After this initial agreement and some practical experience however, I negotiated to be able to use the bakery equipment on a pay-per-use rate, as the bakery samples we were testing with customers were proving successful and I wanted to scale-up production.
From my time in the automotive sector, a found a very competitive freight forwarder which gave me a very competitive price for consolidated sea transport which I then used to import the corn flour from Mexico. That saved me a lot cash, especially on the first import shipments I made, which weren’t as large as they are today.
I also bought a mini-van for deliveries by borrowing from a friend the upfront payment and leased it for three years, and I did everything to save on costs, from doing the accountancy work, to being the driver, leading the sales activities, controlling the purchasing processes, and I even wore the proverbial hat of baker and ‘master’ tortillero.
Today I have bought one third of the bakery equipment from the owner, we have a full-line of tortilla production with higher capacity. and we invested in a wheat tortilla machine – which is a totally different process from corn-based products but very similar to common bread, which allows for additional efficiencies. And today we have expanded our delivery fleet to three automobiles.
After two years of hard work I was eventually eligible of a corporate loan, and obtaining a lender financing allowed me to continue improve the quality of inputs we’re able to use, and therefore the quality of products we’re able to offer the market.
I have two partners in Mexico with whom we run a trading company specialized in the export chili peppers to Europe, and we are now importing around ten tons of dry chilies a year from Mexico to sell and distribute in Europe.
JM: Your company today has an important production capacity for local-market baked goods, in addition to your tortilla production capacity. You also mentioned to me that you really want to evolve your business into a full-fledged trading company. What’s the short term plan, and how do you see your business 5 years out?
OA: Yes, I am partnering with two fellow IE alumni who have both have important experience in the finance and asset management industry, and in the wholesale import of Mexican products to the USA, and given they already have a solid infrastructure there, big network of suppliers and strategic partners in Mexico, I will be working with them to further expand my business in Europe. Our vision together is to establish in Prague the most important European importer of Mexican products. Operations will start in Prague, taking advantage of the client and supplier network and infrastructure built by the bakery and the tortilla factory, in order to accelerate the initial growth and keep a sustainable development in Europe. With this move we will vertically integrate manufacturing, distribution, trading and logistics.
JM: What is it that most motivates you to run your own business? How did you know this was the right move to make? You had a very comfortable job at a multinational before launching into your MBA and new venture. Why take the risk?
OA: After many years working for top companies I realized I needed more from my work to be satisfied professionally. And, while I had many successes over the years, there were often ceilings I would reach that limited my professional growth. This happened at all levels I had during my career in top companies from internships to country management, so it motivated me to seek out tools to make a real change, one that would give me more ownership over my professional development – and satisfaction.
In order to have a broader idea of business management, I decided to do an MBA. Deciding to do a master’s degree in business implied important changes in my professional and personal life, I also wanted to break out of my comfort zone and I so decided to finally launch my own company too. And taking on both the degree and the new business projects was without a doubt the best thing I could have done in my life. From the degree experience I learned much new and complementary knowledge, and I’ve never been so satisfied as I am today with the work I’m doing. Being an entrepreneur is tough work, but it’s also very fulfilling work.
JM: Given your business is in full-growth mode, and that your current market focus is Central and Eastern Europe, what are some of the big business opportunities you’re seeing? What country markets are well positioned for medium term growth in both consumer spending, and which countries are showing a real interest in international goods and services?
OA: I believe fresh goods and beverages from Mexico are the ones that present the biggest opportunity at this moment in all of Europe. Scandinavia and Central Europe are still high opportunity markets. Germany surprisingly is still developing its market for Mexican goods but the size of the market is huge, and I’m keeping a close eye on opportunities there.
About the author
Regional Director for Asia Pacific