How to Start a Tortilleria Business

Are you passionate about authentic Mexican cuisine and dream of bringing the aroma of freshly made tortillas to your community?

Starting a tortilleria business offers an exciting opportunity to turn that passion into a profitable venture by providing a product that is deeply rooted in tradition and highly valued for its quality.

In this comprehensive guide, we’ll walk you through all the essential steps you’ll need to take to start your own tortilleria business, from conducting market research and securing funding to selecting the right equipment, setting up operations, and attracting customers.

Ready to turn your business idea into a reality? We recommend forming an LLC as it is the most affordable way to protect your personal assets. You can do this yourself or with our trusted partner for a small fee.

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Industry Overview

The tortilla industry in the United States has seen significant growth in recent years, fueled by the rising popularity of Mexican cuisine, the increasing Hispanic population, and a growing interest from consumers across various demographics in authentic, diverse food options.

In 2023, the industry reached an estimated $6.5 billion in revenue, reflecting an average annual growth rate of 3.8% over the past five years.

Looking forward, this growth is projected to continue as consumer preferences evolve, with tortillas expected to maintain their position as a leading alternative to traditional bread products.

This is largely due to their perceived health benefits, Gen Z’s preference for authentic & artisanal foods, and their versatility, which makes them adaptable to a wide variety of dishes.

Startup Costs

If you’re considering whether a tortilleria business is right for you, the first thing you’ll need to know is whether it’s a) affordable, and b) worth the investment. I mean, how much can you actually make running your own tortilleria business?

Well, it depends. The initial investment for a tortilleria business varies widely based on factors such as where you plan to set up, how large you want your operation to be, and what type of equipment you decide to invest in:

• Equipment ($20,000 – $100,000+): You will need to purchase corn grinders, tortilla machines, comals (griddles), and packaging equipment to produce and package your tortillas.
• Kitchen Equipment ($5,000 – $25,000): You will also need items such as dough presses, ovens, refrigerators, and other essential kitchen equipment to prepare and store the tortillas.
• Lease or Purchase of Commercial Space ($1,500 – $10,000/month): You will need to budget for the cost of renting or purchasing a facility, which will vary greatly depending on your location and the size of your operation.
• Permits and Licensing ($500 – $3,000): You’ll need to acquire health permits, business licenses, and possibly food handling certifications, depending on your state and local regulations.
• Initial Inventory of Ingredients ($2,000 – $20,000): You will need to purchase ingredients such as corn (for corn tortillas), wheat flour (for flour tortillas), lime (for nixtamalization), salt, and vegetable oil or lard. The cost of these ingredients will depend on the types of tortillas you plan to produce, the quality of the ingredients (e.g., organic vs. conventional), and the volume of production.
• Packaging Materials ($500 – $2,000): You will need to budget for plastic bags for individual tortilla packs, larger bags or boxes for bulk orders, labels with nutritional information and branding, as well as heat sealers or twist ties to close the packages. The cost will vary depending on the volume of tortillas you plan to produce, the type of packaging you choose (e.g., basic vs. custom-printed bags), and whether you’re packaging for retail, wholesale, or both.
• Branding and Marketing ($1,000 – $5,000): You will need to invest in logo design, website development, social media setup, digital advertising, and signage for your tortilleria to build a strong brand presence both online and locally.
• Staffing Costs ($3,000 – $10,000/month): In a small tortilleria operation, staffing will typically be minimal, with the owner often taking on multiple roles; however, depending on the size of your operation, you may need to budget for additional employees, with costs depending on factors like location, skill level, and production volume.

Note: While it may not be an immediate startup cost, it’s generally advisable to have at least three to six months’ worth of operating expenses on hand when starting a tortilleria business. This financial cushion will help you cover payroll, utilities, inventory, and any unexpected costs that may arise during the early stages of establishing your business.

Earning Potential

Tortillerias — like most production-based food businesses — tend to generate profitability through high sales volumes rather than high margins per unit.

This means that while each tortilla may yield a small profit, producing and selling them in large quantities is what drives revenue.

Simply put, the earning potential of a tortilleria comes from selling 1,000 tortilla packs at $2 each, rather than 100 tortilla packs at $20 each.

One strategy some tortilleria businesses have adopted to improve profitability is focusing on fresh tortillas, which command higher prices and better margins due to their superior taste.

Having said that, this can be tricky, as fresh tortillas are highly perishable and require same-day delivery to maintain freshness, adding logistical complexities and increasing the risk of spoilage.

On the other hand, frozen tortillas, though sold at lower prices, provide more stability; their longer shelf life reduces the risk of spoilage and allows for more flexibility in production and delivery.

This makes them a steady source of income, particularly for large-scale operations that focus on wholesale distribution to grocery stores and restaurants.

Ultimately, finding the right balance between producing fresh and frozen tortillas — or focusing on the option that best suits your specific business model — is a decision you’ll need to make in order to maximize profitability and ensure the success of your tortilleria.

7 Steps to Starting a Tortilleria Business

In order to start a tortilleria business, you’ll need to complete the following steps:

1. Planning Your Tortilleria Business
2. Registering Your business
3. Secure Funding (If Applicable)
4. Finding and Securing the Right Location
5. Setting up Business Accounting
6. Getting all Applicable Licenses and Permits
7. Obtaining Business Insurance

We’ve broken each one of these down in more detail below.

Still exploring your options? Check out other small business ideas.

Step 1: Plan Tortilleria Business

Before diving into your tortilleria business, you’ll need to spend some time conducting thorough market research.

You will first need to focus on defining your target market — whether it’s individual consumers, restaurants, or grocery stores — and assess the local demand for tortillas.

You should consider questions like: What types of tortillas are most popular in your area? What will your cost base be, and more importantly, how much are customers willing to pay for your products?

You will also need to analyze your competitors to find gaps in the market that your business can fill, and stay informed about industry trends like the demand for organic or gluten-free options.

This will help you evaluate the financial viability of your project — including projected revenues and expenses — as well as determine the best location for your business.

Finding a Suitable Name

Choosing the right business name is both important and challenging.

This is because your name will need to be eye-catching, memorable, and (at least somewhat) related to your industry.

If you don’t already have a name in mind and need help, you can visit our How to Name a Business guide or use our Tortilleria Business Name Generator tool.

If you do have a name in mind, we recommend researching the following:

• Your state’s business records
• Federal and state trademark records
• Social media platforms

You will also need to make sure that your business’s name is available as a domain — this is your website’s URL address.

Note: If you’re planning to operate a sole proprietorship, you might want to operate under a business name other than your own name — known as a “Doing Business As” (DBA) name. Keep in mind that this is not recommended for a tortilleria business.

Sourcing Quality Ingredients

Another important decision you will need to make when planning your tortilleria is how to source high-quality ingredients, as these will directly impact the taste, texture, and overall quality of your tortillas.

First, you will need to decide which ingredients to use — such as fresh masa, masa harina, or other specialized masa products for your corn tortillas — since each option offers different flavors and shelf lives.

Similarly, for your flour tortillas, you will have to choose between all-purpose flour, bread flour, or high-gluten flour based on the texture and flavor you aim to achieve.

Once you have identified the types of ingredients you will use, you need to decide whether to source them locally or opt for imported options, as well as your stance on additives and preservatives.

Making informed choices in these areas will help you create a product that aligns with market demands and supports your business growth.

Step 2: Register Your Business

One crucial aspect that cannot be overlooked when starting your tortilleria business is the importance of establishing a solid business foundation. While sole proprietorships and partnerships are the most common entity types for small businesses, they’re a far less stable and advantageous option than LLCs.

This is because unincorporated business structures (i.e., sole proprietorships and partnerships) expose you as an owner to personal liability for your business’s debts and legal actions, while LLCs protect you by keeping your personal assets separate from your business’s liabilities.

In practice, this means that if your tortilleria business were to face a lawsuit or incur any debts, your savings, home, and other personal assets could not be used to cover these costs. On top of this, forming your business as an LLC also helps it to appear more legitimate and trustworthy.

Note: If you’re interested in more information before getting started, we recommend having a look at our state-specific How to Start an LLC guide (DIY) or our in-depth Best LLC Services review (for those opting for a professional service).

Step 3: Secure Funding (If Applicable)

Securing funding is a critical step in starting your tortilleria business. Financing options include bank loans, Small Business Administration (SBA) loans, private investors, and crowdfunding.

Each option has its pros and cons, and the best choice will ultimately depend on your financial situation and business plan.

However, it’s important to note that in the food production sector it’s generally advisable to avoid taking on significant debt in the early stages of your business.

This is primarily because — especially for businesses with low margins such as tortillerias — those interest payments can become a substantial financial burden and make it difficult to achieve profitability.

Think about it: if you’re making a 10% profit on 70% of your sales (e.g., to large-scale businesses) and you take on debt with interest rates of 4-8%, you could end up with less than 5% profit overall, which might not even keep up with inflation in some scenarios.

Of course, the extent that this step will be applicable to you will depend on your individual financial situation.

Step 4: Find and Secure the Right Location

The next step you’ll want to take is to find (and secure) the right location for your tortilleria business.

While the ideal location depends on many factors — including your target market, budget, and proximity to suppliers — the most important factor is ensuring that your location allows easy access for both your customers and delivery operations.

Remember, you’ll make your highest margins on direct consumer sales, so being in a location that encourages foot traffic and easy customer access is key to maximizing profitability.

Of course, this will primarily depend on your business model, as well as whether your focus is on retail, wholesale, or a combination of both.

Note: You will also need to make sure that your prospective property is zoned for commercial use and complies with all applicable local and state regulations (discussed in more detail in Step 6).

Step 5: Set up Business Accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business.

You can categorize specific accounts related to your tortilleria business operations into various categories, such as:

• Ingredient Costs: You will need to track expenses for corn, flour, salt, and other raw materials used in tortilla production.
• Equipment and Machinery: You will need to record costs related to tortilla presses, mixers, ovens, and packaging equipment.
• Labor: You should always take into account wages paid to employees involved in production, packaging, and sales.
• Utilities: You will need to also keep track of electricity, gas, and water expenses.
• Packaging Materials: You should monitor costs for bags, boxes, and labels used to package your tortillas.
• Distribution: If applicable, you will have to track expenses related to delivering tortillas to customers or retailers.

In addition to tracking expenses, you will also need to record and monitor all sources of revenue to maintain a clear understanding of your overall profitability:

• Product Line Revenue: You will need to track income based on different product lines (e.g., corn tortillas, flour tortillas, specialty tortillas).
• Sales Channel Revenue: You will also need to track revenue from various sales channels (e.g., retail, wholesale, restaurant supply).
• Specialty Products: You should also track revenue from higher-margin items, such as organic, gluten-free, or premium tortillas, to evaluate demand and profitability for these niche products.

This should provide clear visibility into your business’s financial performance and aid in accurate cost analysis.

Step 6: Secure All Required Licenses And Permits

The applicable licenses and permits that you’ll need will largely depend on your state and local regulations.

Even so, we’ve compiled a list of some of the common licensing regulations that you’ll likely need to satisfy in order to operate legitimately.

Food Manufacturing License

A food manufacturing license is often required if your tortilleria will operate as a large-scale food production facility.

This license ensures your operation meets state and federal standards for food safety and sanitation and is typically obtained through your state’s department of agriculture or health.

The requirements for this license vary by state but typically involve an inspection of your facility and a review of your production processes.

Wholesale License

If you plan to sell your tortillas to other businesses or retailers in bulk, you will likely be required to obtain a wholesale license.

You can apply for this through your state’s tax or business registration agency, with the process generally involving providing documentation about your business, information on your storage facilities, and any necessary health or safety certifications.

Keep in mind that in some states, a wholesale license is included with a general business license, so you may not need to apply separately.

Food Handler’s Permit

A food handler’s permit, often referred to as a food handler’s card, is typically required for all employees involved in handling food at your tortilleria.

This permit certifies that individuals have been trained in food safety practices, such as proper food handling, storage, and hygiene standards, and is usually obtained through your local health department. 

The process generally involves completing a training course and passing an exam, though the specific requirements may vary based on your local jurisdiction.

Zoning and Land Use Permits

Before establishing a tortilleria business, you’ll need to ensure that the land is zoned appropriately for a food production facility.

Zoning regulations vary by locality and dictate the types of activities that can be conducted on a piece of land. In some areas, you may need to obtain a special use permit or a variance if the land is not already zoned for your intended use.

We recommend consulting with your local zoning authorities in order to understand the specific requirements and restrictions that will be applicable to your tortilleria business. Alternatively, you can consult with a business attorney if you want someone else to take care of this for you.

Health and Safety Inspections

Local health and safety inspections are mandatory to ensure that your tortilleria business complies with health codes and safety standards.

These inspections typically cover aspects such as the cleanliness of the facility, the safety of the structures, and the adequacy of emergency exits.

Regular inspections help maintain a safe environment for patrons and are often required for the renewal of operating permits.

Step 7: Secure Business Insurance

In addition to securing the necessary permits and licenses, you will need to obtain the right business insurance.

Note

Even if you form an LLC, purchasing business insurance is still a good idea. This is because an LLC structure protects your personal assets, not your business’s.

While specific coverage needs may vary based on factors such as location, size, and unique risks, there are several key types of insurance that most tortilleria businesses should consider.

We’ve briefly outlined these below.

Food Spoilage Insurance

Food spoilage insurance protects your tortilleria against financial losses resulting from food spoilage as a result of things like power outages or equipment failure.

This coverage is particularly important for businesses that handle perishable goods like tortillas, where even a brief loss of refrigeration or power can result in significant product loss.

The cost of this insurance will depend on the size of your operation and the amount of perishable inventory you typically have on hand.

Having said that, as a general range, you can expect to pay anywhere between $500 and $2,000 per year for this coverage.

Product Liability Insurance

Product liability insurance provides protection if a customer becomes ill or experiences harm from consuming your tortillas or other food products.

In the food manufacturing industry, this coverage is a must as it shields your business from costly legal claims related to foodborne illnesses, allergic reactions, or other product-related issues.

The cost of this coverage typically ranges from $400 to $1,500 per year, depending on factors such as your location, the size of your operation, and the volume of products you produce.

General Liability Insurance

General liability insurance is a foundational coverage that’s essential for a tortilleria business because it protects against claims of bodily injury, property damage, and personal injury that may occur on your premises.

The average cost for general liability insurance according to recent data is $42 per month, or $504 annually, though costs can vary based on your business’s specific needs and risks.

Property Insurance

Property insurance is essential for safeguarding your tortilleria business’s physical assets, such as the buildings, equipment, and inventory.

The median cost for business property insurance is approximately $63 per month for plans with a $1,000 deductible and a $60,000 policy limit.

Having said that, rates can vary significantly based on factors such as your location, risk profile, and the value of the property in question.

Ready to Get Started?

How to Start a Tortilleria Business FAQs

How profitable is a tortilleria?

A tortilleria can be very profitable, especially when focusing on high-volume production.

Although profit margins per unit may be low, the ability to produce and sell tortillas in bulk, especially to grocery stores, restaurants, and wholesalers, makes it a viable and potentially very lucrative business.

How much does it cost to make a tortilla?

The cost of making a tortilla depends on factors such as the scale of production, the quality of ingredients, and the equipment used.

On average, producing a standard tortilla can cost just a few cents per unit, while more specialized options, like organic or gluten-free tortillas, will typically cost more due to the higher price of premium ingredients.

What is tortilla business?

A tortilla business, or tortilleria, specializes in producing and selling tortillas, either fresh or frozen, to consumers, restaurants, or grocery stores.

These businesses often focus on high-volume production using specialized equipment and may offer various types of tortillas, such as corn, flour, or specialty options like organic or gluten-free, to cater to different market demands.

What is a tortilla shop called?

A tortilla shop is commonly referred to as a tortilleria.

These businesses specialize in making and selling fresh or frozen tortillas, often providing them to both individual customers and wholesale buyers like grocery stores and restaurants.