From its beginnings as a toiletries and personal hygiene product distributor in 1914, Grupo Herdez has grown into a leading player in the processed food and ice cream categories domestically, while in the US it has become one of the fastest-growing players in the authentic Mexican food industry.
It was listed on the Mexican Stock Exchange in 1990 (HERDEZ®). In 1947, when the partnership between Grupo Herdez and McCormick & Company was signed, the HernándezPons family mayonnaise recipe with lemon juice became a national favorite, founding the company’s purpose of bringing the best of the world’s flavors to Mexicans, and offering the best of Mexican food to the world.
This marked its first strategic alliance. Today, it has more than 25 brands and 1,500 products in its portfolio across more than 40 categories including guacamole, ice cream, mayonnaise, pasta, salsas and tomato puree.
Its brands are available in 21 countries, thanks to a network that includes 15 plants, 24 distribution centers and more than 9,000 employees. The Group’s CEO, Héctor Hernández-Pons, has been with the company for 42 years and in this role since 2004.
As the grandson of Don Ignacio Hernández del Castillo, whose entrepreneurial vision laid the foundations for all that has followed, the business runs in his veins. But like the two generations that have come before him, he isn’t afraid of making tough decisions to futureproof the family legacy.
As the decades passed, international and local brands such as Barilla, the world’s leader in pasta, and Búfalo sauce were added to its portfolio; however, Hector’s legacy is strongly marked by the expansion of the business through acquisitions, strategic alliances and strengthening the financial structure.
“When I became CEO, I realigned the company’s vision,” he says. “We needed a new strategy that could easily adapt to the new consumers in the new millennium.” Part of this blueprint included the reduction of debt and the increase in profits across the business units.
“This allowed us to move forward with the plans I had that were not only based on organic growth and innovation, but also to trigger inorganic growth through strategic alliances and acquisitions.”
Before Hector’s fifth anniversary, Grupo Herdez created one of its most important joint ventures to date: Herdez Del Fuerte. This led to the creation of MegaMex in the US one year later (2009) which is a partnership with Hormel Foods.
MegaMex has become a leading full-line provider of Mexican foods with brands like Herdez, Wholly Guacamole and La Victoria, with a combined mission to bring the spirit of Mexico to every table in the US.
Since 2013, Héctor has also diversified the company’s portfolio by dabbling in frozen categories such as frozen yogurt and ice cream. The company’s legacy is also a reality because of its longstanding commitment to sustainability through environmental, social and corporate governance standards.
Since 2012, Grupo Herdez has been part of the Global Compact of the United Nations. With its aim of aligning the business to the largest global movement in this field, in 2019 Grupo Herdez transformed its Sustainability Strategy and integrated the 2030 agenda by adopting six Sustainable Development Goals (SDGs).
In 2020, the company was recognized as an industry leader in managing the most significant ESG risks and opportunities by Morgan Stanley Capital Investment with an AA rate. Hector’s conviction is that the company should continue to contribute to a more sustainable world for future generations.
He is acutely conscious of the business legacy that has been handed down to him and his brother Enrique (Grupo Herdez’s Vice-Chairman and Deputy CEO). But Héctor also understands exactly what is required to uphold the responsibility.
“We must remain committed to innovation and be on top of our consumers’ needs so that we can continue to provide high-quality products,” he says.
“Innovation is one of our core focuses in all senses.” Innovation alongside a wide product portfolio is also what allows Grupo Herdez to be one step ahead of new consumer trends. Héctor notes that consumers are paying more attention to ingredients as they prioritize a healthier diet.
“Consumers have become more sophisticated,” he explains, adding that it is a trend COVID-19 has accelerated, but something the company was already working on. As in most markets, the pandemic has also seen demand rise for online shopping in Mexico.
(According to Forbes Mexico, ecommerce could increase in the country by up to 60% as a result of quarantine.) Héctor believes that now is the time to grow the company’s digital communication and sales channels – not only in response to changing consumer habits, but also as its clients become more digitally savvy themselves.
After more than a century of legacy, Héctor is convinced that Grupo Herdez will transit these challenging times as it has many times before thanks to its unique business model, a sustainability approach across all of the company, international standards to leave a better world for next generations and a strong commitment of tending to the most sophisticated interests of consumers across markets.