Planet Money - Hot Cheetos

Episode Date: May 13, 2021

A janitor walks out of a chip factory with a bag of dustless Cheetos and changes the global snack game forever. | Subscribe to our weekly newsletter here.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

Support for NPR and the following message come from the Kauffman Foundation, providing access to opportunities that help people achieve financial stability, upward mobility, and economic prosperity, regardless of race, gender, or geography. Kauffman.org Hi, it's Alex Goldmark, the supervising producer here. And Sarah Gonzalez, one of the co-hosts. We want to tell you more about this episode that we've learned since we first released it. It may not make sense to anybody who hasn't already heard the episode or who has not heard other claims made about the episode since we published it.

But in the spirit of transparency, here's what we know. OK. This episode centers on a claim that Richard Montanez invented a product that came to be known as Flaming Hot Cheetos. Richard Montanez invented a product that came to be known as Flaming Hot Cheetos. He claimed he and his wife inspired the seasoning that led to the chip we find on store shelves today. This is inaccurate. The timeline laid out in our episode is incorrect. Montanez told us that he pitched an idea for Hot Cheetos in a meeting in 1990. According to Patty Roof, the person who set up that meeting, and Al Carey, a former executive who was in the meeting, it could not have happened before 1992. And by that time, products had

already been sold in the Midwest under the trademark Flamin' Hot. We spoke to Lynn Greenfeld, who led the team that created the Midwest products. Montanez was not involved. But she and other former employees say that Montanez did pitch flavors and product ideas. Al Carey, he maintains that Montanez pitched him an idea for a spicy Cheeto that he approved and rolled out in California. It came out after Flaming Hot products were already sold in stores elsewhere in the country, and Carey now says the California product would have used the seasoning from the Midwest products. And the reason we are talking about seasoning so much is because in our episode,

we ask whether Montanez and his wife were ever compensated for their recipe. It's now clear Hot Cheetos never used their recipe, so of course they were not compensated. As we say in the original episode, the reporting is based on the recollection of people at Frito-Lay roughly 30 years ago, as well as what the company told us, which they said was based in part on an earlier internal investigation. Before we published the episode, we corresponded with Frito-Lay over a dozen times by email, phone, text. We asked Frito-Lay directly multiple times whether Montanez was involved in the invention of Hot Cheetos. At first, they told us we do not credit the product creation to him and him alone. When we asked them to clarify whether that meant Montanez was not involved at all, they said, quote, he was a part of it. Yes, sure. They did tell us about the existence of the Midwest release of Flamin' Hot products before

we published. They also told us that it was possible that the Midwest product could have been happening at the same time as the California product. Frito-Lay seemed to be speculating about the dates. So for our episode, we relied on Richard Montanez's recollection of the timeline. We should not have. The Midwest product was first. After we published the episode and after another news outlet disputed Montanez's claims, Frito-Lay told us they shared information with that outlet in more definitive ways than they shared with us. Separately in the episode, we say that Richard Montanez taught marketing at Columbia. That was a reporting error.

He has not taught there. He has given lectures at other universities. We're going to keep monitoring this, and if we discover anything else that needs updating, we will do that here. Now, here is the original episode as originally published. This is Planet Money from NPR. Richard Montanez was 18 years old when he applied for a job as a janitor at the Frito-Lay factory in Rancho Cucamonga, California. His girlfriend, Judy,

actually applied for the job for him. She's from the hood too, man. So she's my road dog. She'll roll with me anywhere. She got my back, you know, all that. It was 1976. Richard could barely read and write back then. So Judy filled out his application. And I remember I took it back and gave it to the HR and I was so nervous because there was nothing true on that application. And I remember I took it back and I gave it to the HR and I was so nervous because there was nothing true on that application. I got the job on the spot. If Richard ever had a dream at this point in his life, this was it. A union job with benefits. I get my uniform, you know, it's going to say Frito-Lay and I'm just,, just so, I can't wait to show everybody. Richard was at the chip factory. You know, Doritos, Fritos, Lays, Cheetos. And he's like, wow, what a place.

Quality control is walking out every 15 minutes to check the thickness of it, the taste, the oil content, just incredible. You know, it's almost like NASA. He's working the graveyard janitor shift, mopping the floors, making $3.10 an hour, which is great for 1976. He has insurance. He can take care of Judy. He is loving it. And about 13 years into the job, Richard walks into this chip factory one day with some very specific instructions from Judy. She said, OK, tomorrow, go to the plant and bring some Cheetos

with no cheese, you know, unseasoned. Whenever the Cheetos machine at Frito-Lay would break or stop, there'd be all these dustless Cheetos left behind that they would just throw away. Judy's like, bring some of those plain Cheetos home. So, you know, I go to the plant, I get a trash bag and I stick a bunch of Cheetos in there that have no cheese. And I got that trash bag and I wrapped it over my my back, you know, like I was carrying out trash. And, you know, people always tell me, Richard, you are so ghetto. I said, yes, but I'm ghetto rich. Hello and welcome to Planet Money. I'm Sarah Gonzalez. And you know what happened next.

The day Richard Montanez walked out of the factory with those dustless Cheetos, he changed the global snack game forever. Today on the show, the story behind Hot Cheetos. A bright red spicy little chip that hit a growing Latino market at just the right time. The whole Hot Cheetos portfolio makes Frito-Lay billions of dollars. And today, Richard is known as the godfather of Hispanic marketing. But it is not quite a Cinderella story. Okay, how do you eat your Hot Cheetos? Pour nacho cheese on top. That's a hit. So good that way. That's a hit. Okay, how do you eat your hot Cheetos? Pour nacho cheese on top.

That's a hit. So good that way. That's a hit. That's the bomb, man. The best way, pour it in a bowl, put a ton of lime all over it, eat it with a spoon. Why? So you don't get the red hot Cheeto fingers. Okay, way before Richard Montanez ever thought about creating any new chip flavor, he was growing up in Guausti, California in the 60s.

It used to be a big wine-producing area. His family were all farm workers there. My grandpa picked grapes. All my uncles picked grapes. My aunts. Everybody. He grew up in farm worker housing. Like a dorm-style kind of living?

Yeah. And the kitchens were outside, like big stoves, like restaurants. And the bathrooms were down the streets. He says they were dirt poor, but happy. It's hard to understand. It was a fun kind of poor. You know, we had fun. This is during the civil rights movement and during desegregation in California. And when Richard is seven years old, he and a handful of other Mexican kids in Guausti are all assigned to a school on the white side of town. They're going to get bussed there. But they don't get picked up in the yellow bus like the white kids.

They get picked up in this clunky pea soup color bus. At lunch on the first day at the new school, Richard sits with all the other Mexican kids. And I remember I pulled out my lunch. Everybody was staring at me. The white kids are like, what is that? And I put it back because it was a burrito. He goes home that day and tells his mom, please do not make me a burrito tomorrow.

Make me a bologna sandwich. Yeah, you know, like the other kids, right? But my mom, you know, the leadership of a woman is just incredible in my life. I would take the leadership of a woman any day. Same. So mama said, no, mijo, this is who you are. So the next day she made me two burritos. And she said, here's one for you.

And here's one to share with a friend. So I got bused to school on Wednesday. So I had my burrito nightmare on Wednesday. Thursday, I shared a burrito with a friend. Friday, I was selling burritos for 25 cents a piece. No. What was in the burritos? Just beans and cheese.

Richard would turn out to have a particular talent for this kind of thing, for hustling. But he's still not fitting in at school. By age eight, he basically stops showing up. He keeps getting picked up for ditching. And around this time, his family moves out of farm worker housing. We moved from that little dorm to, you know, the barrio. Yeah. The hood.

The hood, where all the good snacks are. Yeah, that's where I ended up growing up most of my time. Richard starts picking up odd jobs, whatever jobs a child can get in the 60s. And he joins a gang, but he's terrible at it. I was always getting locked up all the time. I just wasn't a good thug. You know, I got caught for everything I did. He meets Judy when they're like 12, 13,

they're neighborhood kids, and they start dating. And when Richard turns 18, Judy's like, okay, it's time for you to get a real job. Richard hears they're hiring at the Frito-Lay plant. I thought, oh, my God, just think if I could get a job at Frito-Lay. When he gets the job, he runs over to tell his grandpa, I got the job. I said, I'm the janitor. I'm going to mop the floor. And he said, when you mop that floor, you make sure that it shines.

And when people see it, they know that a montagne is mopping. If he finished cleaning everything before his shift was done, he'd just clean everything again, you know, make it shine. So people were walking into the bathrooms and it was spotless, smelled good. He thinks he is crushing it. But the way Richard tells it, 30 days into the job, his boss calls him into the office, says, Richard, I'm going to have to let you go. You don't have any initiative. Oh, I begged him, please, please, let me fix it. Just please, let me prove to you I can just. He says, OK, you got two weeks. So I went home and I told Judy, Judy, he's going to let me go. He says, why? He says, I don't have no initiative.

Richard says he actually had no idea what the word initiative meant. But Judy is like, OK, let's go to the library. Let's figure out what this word means. And he's like, oh, that? I have that. After that, I think I just took initiative way over the top. He did. Richard, the janitor, starts doing all these extra things. Like someone wanted a cigarette break, he'd fill in for them, run the production line. He'd be the one going like, okay, give me oil now, now hit me with the Cheeto dust. He starts helping out in packaging, packaging chips. He claims he breaks the record for the most pounds of product bagged, like by several thousand pounds. product bagged like by several thousand pounds. There are these sales meetings with all the top executives, Richards in the back taking notes. People are like, what is the janitor doing back there with a notepad? But okay, whatever. About a year in, Richards promoted to machine operator, but he says he's still also on the sanitation crew. And at some point, he gets a chance to turn some of his hustle into some real extra coins. Richard says Frito-Lay had this program. Any employee with an idea to improve the company could win a dollar, a silver dollar.

And Richard, he was full of ideas. I was submitting ideas just to get a dollar. You know, a dollar in my day was like, hey man, we're going to eat good tonight. You know, a dollar in my day was like, hey, man, we're going to eat good tonight. Richard's giving them some bad ideas, some good ideas. Like he told me he suggested a new chip flavor. The chile limon flavor. Mexicans put chile and limon on everything. Like we put chile and lime in our soup, in our beer, in our ice cream. Richard's submitting ideas just because he wants people to think, what a good worker that guy.

You know, that was kind of a mistake on my part. This is all according to Richard. Frito-Lay says their record keeping was not great back then. They're unable to verify this win a silver dollar program was even a thing. But okay. At some point, Frito-Lay's parent company, Pepsi, gets this new young CEO, a guy named Roger Enrico. He sets a new tone. And in the late 80s, Richard remembers him telling employees, I want to empower you.

I want everyone here to act like an owner. Richard keeps replaying this in his head, act like an owner, act like an owner. And he thinks, I don't know, an owner would probably know about like sales. So he offers to help stock chip bags at all the stores on the sales route on his own time, not on the clock, just to try to act like an owner. He's at a little supermarket in the Mexican part of town, stocking chips in a row, Lay's, Ruffles, Fritos, Lay's, Ruffles, Fritos. And right near the chip rack is the Mexican spices rack. That's when he gets his big idea. I saw people buying chili peppers.

I saw people buying spices. And I looked at our Lay's Ruffles Fritos. I thought, we don't have anything for people who like spices. And he thinks, that's what I'm going to do. I'm going to make a spicy chip for people like spices. And he thinks, that's what I'm going to do. I'm going to make a spicy chip for people like us. And Judy, who is now his wife, happened to make a great spicy salsa. Selling it was actually one of their side hustles. But which chips would he make spicy? Potato chips? Funyuns? It's got to be the right chip. So Richard thinks about this for a couple weeks. And he's with his

kids at an elote cart one day ordering some elotes. It's grilled corn on the cob, but like smothered in butter and mayonnaise covered in cheese, little squirt of lime, then red chili powder sprinkled all over. And it was just so delicious. Oh my God, you know, all those flavors in one. And with the red chili powder all over the corn on the cob like that, it kind of looked like... Oh my God, that looks like a Cheeto. He's like, Judy, I got it. We're going to put your chili on Cheetos. A hot Cheeto.

Now he just had to get his hands on some plain ones. Which brings us back to the day he walks onto the plant floor with an empty trash bag and walks out with a bag full of dustless, cheeseless Cheetos. By that point, he and Judy had a whole plan of attack, their own research and development operation at home in their kitchen. You said that Judy's salsa is what you used to sprinkle on the Cheetos without Cheeto dust. Was it like a wet salsa or was it like a little powder? It was wet and we dried it into a powder, but it was a lot to make a little

bit, you know? Yeah. And the whole house smells like you like smoke out the whole family when you're making salsa. Right, right. They make a few versions before they come up with the right chile dusting. But it's not sticking to the chips. At the plant, they use oil to make the orange cheese dust stick to Cheetos. So Richard puts some oil in a water bottle, a squirt water bottle. So I would squirt the Cheetos. Judy would put the chili on there. And then I would just softly just tumble the bag back and forth.

Their kids are also helping. They put the chips in these little see-through plastic baggies and they iron the bags shut, like with a clothes iron. Richard draws a little devil for the bag and a guy in a sombrero. And all their friends, all their co-workers, they love these chips. They were so spicy. In 1989, Richard says he sends a few samples to Frito-Lay executives but doesn't hear back. After the break, Richard heads to the plant, full of confidence, grabs the company directory and calls the CEO. First name in the directory, the CEO, Roger Enrico. His assistant answers, a woman named Patty Roof. Hello?

Hi, this is Richard Montanez. Can I talk to you? The CEO. So I asked him, who do you work for? Where do you work? This is Patty. So I said, I work in California, Frito-Lay. She said, oh, okay.

You're the president of California? And he kept saying, no, I work at the Cucamonga oh, okay, you're the president of California? And he kept saying, no, I work at the Cucamonga plant. Oh, you're the senior vice president of Southern California. I work inside, inside the plant. Are you in sales? No, I'm not in sales. Are you in research and development? No, product development. No, I'm not in product development. Are you the plan director? No. Plan manager? No. What are you? You know, I'm a janitor. I almost fell out of my chair. Richard tells Patty, I have an idea for the CEO. You know, the hotter the food, the more the Latinos like it. And, you know, we like spicy food and Doritos and Cheetos just don't do it enough. So I put him through to Roger, and they spoke on the phone.

He said, I understand you have an idea for me. He goes, I'll be there in two weeks. I want to hear it. I hung up the phone, and I was floating. I was like, oh, my God, he's coming to hear me. Now, he did not get on a plane just to go see Richard. He used to do these tours all the time to go visit the plants. And so we set up a tour of Cucamonga and he specifically wanted a meeting with Richard. Word spreads around the Cucamonga plant about this call. Conversations all the same. Who let the janitor call the CEO?

Who's this Richard guy? What the hell is going on? Richard's like, whatever. He goes to Goodwill and buys a tie for $3.50, a black one with blue and red stripes. He still has it. He walks into the boardroom with a bunch of his see-through plastic bags filled with red Cheetos, the bags with the little devil on it. He says, tons of people love spicy snacks, and we don't have anything for them. The Latino market is untapped, and this snack could change that. A marketing executive raises his hand. He called my name, Richard, I have a question. And I intentionally looked the other way. I was not about to answer any questions.

And he goes, it's a simple one. And I said, okay. And he said, that sounds good, but how much market share are we talking about? I was ready to just run out the stage. So with the most ridiculous smile and statement, I raised out my arms, opened them wide up, and I said, this much market share. And I could hear the marketing executives kind of like, oh, no, did he just? That's a ridiculous statement. So embarrassing.

But then Richard says the CEO, Roger Enrico, stands up. Ladies and gentlemen, do you realize that Richard just showed us how to get that much market share? He opens his arms as wide as Richard. That much market share. The CEO is on board. Are they like, congratulations, Richard, you're no longer a janitor. Welcome to research and development. Or what was the next step after that? It was a lot of congratulations, but no promotion. But that's really when. Wait, so you were still the janitor? More opportunity, more assignments, but no physical promotion.

He actually didn't end up getting to work on the new chips that much. You know, there are teams of scientists for this kind of thing. But he says he did try to stay involved and consult and poke his head in, but that he had to do all of this off the clock. When I was working on this product, they used to say, hey, Montanus, make sure you punch out because we ain't paying you for that. Are they basing it off of your wife's recipe, off of Judy's recipe? Yes.

They are? Uh-huh. Wow. Yeah, they are. Okay. They are. And did anyone give Judy like a check for her recipe? Nothing.

No one gave anybody anything. No one gave you? I don't even think you got movie tickets. Wow. I did reach out to Frito-Lay to ask them about all of this, and they said that a lot, like a surprising amount, was not documented in the 1980s and 90s. So they don't actually have a real record of how exactly Hot Cheetos came to be. They do say that teams of people are involved in creating a new flavor so that they wouldn't credit any one person.

And they do have a record of a Hot Cheeto on the market in the Midwest around the exact same time that Hot Cheeto samples were coming out of Richard's plant. So they say maybe these two stories together led to the hot Cheeto we see today. But honestly, everyone's dates and everyone's account of what happened is just based on people's recollections. Roger Enrico, the CEO

who took Richard's call, he passed away. But another former CEO, Al Carey, he has publicly said Richard invented Hot Cheetos. OK, back to the story. I remember the first joy is seeing the bags at the plant coming up, the conveyor. I'm just like, I did it. It was 1990. And, you know, Frito-Lay kills new flavors all the time if they don't do well. So Richard's nervous and he starts doing his own guerrilla marketing. He maps out all the stores in East L.A. and tells all his friends, all his family,

go to every store, buy one or two bags, and hype it up in the store. Open up the bag like, ooh, these are so good. And then I started going to parks, car shows, churches, and giving the product away. By 1992, 1993, hot Cheetos are everywhere, popular. It leads to Flaming Hot Fritos, Flaming Hot Doritos, Flaming Hot Popcorn, Flaming Hot Funyuns. Those are bomb. And now, technically, there were some spicy Chile-flavored chips

on the market before hot Cheetos, but spicy chips were not super common, not in the U.S. in the early 90s. Changing demographics, growing numbers of Latinos and Asians and other groups who really like spicy flavors helped propel hot cheetos. And Pepsi and Frito-Lay, they now have all kinds of even non-spicy flavors meant to appeal to Latinos specifically. Like they have limon chips. On the bag it says Lays Limon, not lemon.

And Gatorade, which is part of Pepsi, they have a new Pepino Limon flavor, cucumber lemon, also written on the bottle in Spanish. They actually wrote Limon Pepino, which is not how anyone would say it, but the point is hot Cheetos prove to the world that the Latino market is here and you're probably going to want to make world that the Latino market is here, and you're probably going to want to make things for us. People would say, that doesn't taste good. According to whose tongue? I changed that white mentality tongue to make it a more diverse tongue. Did you ever feel like, hold on, I didn't just give them hot Cheetos. I gave them

all of these flavors. Yeah, I did all the time. Okay. Every day. Every day. That's why I want young people to understand. Don't do the mistakes that I made. You know, get what belongs to you now. Richard did eventually work his way up the company from the plant floor to the corporate office.

But it wasn't overnight. corporate office. But it wasn't overnight. I would say 20 years is I got my biggest raise that made my eyes blink. What position was that? That was vice president. Yeah, he became a vice president at Pepsi, the big, big leagues. And he has since taught marketing at Columbia. He's a motivational speaker. He's written two books. And there are plans to make a Hollywood movie about his life. But Richard says it all kind of came at a cost. Sometimes it's even hard for me to share this, but I was there with them for 42 years at PepsiCo. And I was tolerated, never celebrated. I don't like to talk about that because it just kind of, oh, oh, wow. But, and I'll tell your young listeners that you're going to love your company more than it will ever love you. Richard says he does love Frito-Lay, but that everything he did there was really

always more about his pride. You know, make sure they know a Montañez was here. And Richard is super proud of Hot Cheetos. What are your thoughts, I have to ask you, on Takis, which is sort of like the new super popular bright red chip? Yeah, yeah, they're pretty good. They're so good. They're pretty good. Yeah, you know. Takis, by the way, are made by a Mexican company and they are like the best chip on the planet.

And obviously, of course, both of these chips appeal to non-Latinos also. Hot Cheetos and Takis. Hot Cheetos and Takis. I can't get enough of these Hot Cheetos and Takis. Got my fingers and Takis. I can't get enough of these Hot Cheetos and Takis. Got my fingers stained red and I cannot get them on.

You can catch me in my croak eating Hot Cheetos and Takis. Pow! Snack, snack, snack. Crunch, snack. If you want to show us your red-stained Takis and Hot Cheeto fingers, tag us on Instagram. We're at Planet Money. We're also on Facebook, TikTok, Twitter, at Planet Money. Today's show was produced by Maria Paz Gutierrez and Dan Gurma and edited by Casey Miner.

Alex Goldmark is our supervising producer. Brian Erstad is our show editor. And I'm Sarah Gonzalez. This is NPR. Thanks for listening. Good question. That's a really good question. That's a really good question. It's a great question.

This is free therapy. Thank you for asking me that. God, that's such a good question. That's an interesting question. But what Fresh Air interviews are really about are the interesting answers. Listen and subscribe to Fresh Air from WHYY and NPR. And a special thanks to our funder, the Alfred P. Sloan Foundation, for helping to support this podcast.