Two ‘hot-sauce fortunes’ poised to collide

Bloomberg

Selling “a rich man’s sauce at a poor man’s price” has made David Tran a very wealthy man.
The 73-year-old Vietnamese refugee is responsible for bringing Sriracha to American consumers.
After settling in Los Angeles in 1979, Tran founded Huy Fong Foods Inc, named for the Huey Fong boat that brought him to the US, and started making hot sauces for local Asian restaurants. He earned $2,300 in the first month of selling his creations out of a blue van hand-painted with the brand’s iconic rooster. (Tran, who is ethnically Chinese, was born in the year of the rooster.)
Now, almost four decades later, Huy Fong controls 9.9 percent of the $1.55 billion American hot-sauce market, according to IBISWorld, an industry researcher. “I never thought that it would be so popular,” said Tran, who owns the company with his family. “When I left Vietnam I didn’t know how it would be tomorrow, so today God bless me.”
The Huy Fong factory in Irwindale, California, about 20 miles east of downtown Los Angeles, is a pristine facility with silver conveyor belts that each day shuttle hundreds of thousands of bright red bottles of Sriracha and their distinctive green caps into cardboard boxes. The factory, which operates up to 16 hours a day most days of the week, uses 100 million pounds of chilies each year. That’s enough spice to irritate the senses of some neighbours.
More than 8,000 miles away in a suburb of Bangkok, factory workers toil without air conditioning as forklifts roll through 90-degree heat hauling boxes of the same kind of chili sauce—this one with a red and yellow label and called Sriraja Panich.
Most Americans haven’t heard of the Thai brand, which claims to be the original Sriracha recipe, and that’s something the family behind the sauce is hoping to change.
“If we can get just 1 percent of market share in the US, that would already be huge for us,” said Bancha Winyarat, the 33-year-old vice president of Thaitheparos PCL, which makes Sriraja Panich. The Winyarat family owns a majority of the publicly traded sauce maker, with a market value of more than $251 million.
As Huy Fong’s Tran, the king of American Sriracha, expands in Asia and Thaitheparos targets the US market, both are faced with different tastes and brand loyalties.