Business is a good for Modesto maker of Mexican-style ice cream

Flavors, dense texture stick close to Mexican tradition

May 1, 2009 

  • AT A GLANCE

    COMPANY: Paleteria La Michoacana makes Mexican-style ice cream at a plant on Lapham Drive, just south of Yosemite Boulevard.

    OWNERS: Ignacio Gutierrez, 40, is chief executive officer. His wife, Patricia Gutierrez, 26, is chief financial officer.

    EMPLOYEES: 130

    SALES: $30 million projected for 2009 in 30-plus states

    PRODUCTS: Ice cream bars, sandwiches, cartons and other items in more than 30 flavors

    WHERE TO FIND THEM: Many grocery stores in and near Stanislaus County, including Save Mart, FoodMaxx, O'Brien's and La Perla Tapatia. About 25 street vendors sell the products in the Modesto area.

    ON THE NET: www.ytupaleta.com


Ignacio and Patty Gutierrez have a way of getting through the economy's deep freeze.

They make ice cream with a Latino twist at a plant off Yosemite Boulevard in Modesto.

Their company, Paleteria la Michoacana, has become the largest producer of Mexican-style ice cream in the United States.

The business grew steadily in most years since its founding in 1991, but this year has been something else. Sales are projected to reach $30 mil- lion, double last year's level. The payroll has risen from 90 to 130 people.

The couple said the economy, of all things, is a key reason for the growth spurt.

"They say chocolate and ice cream are the two most comforting foods in a recession," Patty Gutierrez said during a tour of the plant Tuesday. "People are not eating out as much, so you have more people going to the grocery store and taking ice cream home."

The owners also cite the large number of non-Latinos discovering their products, sold in more than 30 states under the La Michoacana brand.

"The funny thing is that this started with Latinos buying it," said Ignacio, better known as Nacho. "Now everybody's buying it."

New ways to boost demand are just what California's struggling dairy industry needs, said Michael Marsh, chief executive officer at Western United Dairymen in Modesto. He said Mexico is the top importer of the state's milk products, and Mexican-style ice cream is a natural for the U.S. market.

'Growing market' nationwide

"It's a very growing market in the United States, not just in California but across the country," he said.

The company's 30-plus flavors include Mexican favorites such as mango, guava and flan, as well as vanilla, strawberry and other types familiar to U.S. residents.

The ice cream comes in 56-ounce cartons, single-serve cups, bars and sandwiches. The company also makes bolis as well as juice bars — one of them flavored with cucumber and chili.

Other unusual flavors await in the freezer case, including rice pudding, changunga (a Mexican berry) and mamey (a Caribbean fruit.)

The ice cream is especially dense, the owners said, and the ingredients are wholesome.

"I think that the flavor profile and the quality are very different from what you see in the (U.S.) market," Patty said. "We have kept it very traditional."

Ignacio Gutierrez, 40, emigrated from Jalos, Mexico, when he was 5. He got started in the frozen treat business with a snow cone cart in Turlock in 1988. He founded the ice cream company there in 1991, then moved it to Mo- desto in 2002.

Patty Gutierrez, 26, is from the same town in Mexico. They have three children — Kimberly, 8; Matthew, 2; and Katie, 1.

The company is named in part for paletas, a Spanish word for ice cream bar, and the state of Michoácan, which lends its name to many ice cream parlors in Mexico.

The 35,000-square-foot plant makes 500 gallons of ice cream every 45 minutes. The milk comes from Berkeley Farms, a major buyer from dairy farmers in the Northern San Joaquin Valley.

The fresh ice cream is chilled to 42 degrees below zero at the start of molding and packaging. The power bill runs $20,000 to $30,000 a month.

During Tuesday's tour, strawberry ice cream was being made into bars at a rate of 11,000 an hour. Another machine can do 24,000.

The operation includes production workers, drivers and sales people, as well as a distribution center in Gardena, Los Angeles County.

It also has about 25 street vendors in the Modesto area.

"It keeps the local customers more in touch with our company," Gutierrez said.

Bee staff writer John Holland can be reached at jholland@modbee.com or 578-2385.

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