Tastes From Home

Immigration Feeds Rhee Bros.' Growth

The story of how Syngman Rhee built one of the largest Asian food distributors in the Washington area starts with a container of dried squid.

Rhee came to the United States in the early 1960s to earn his master's degree in political science at American University. Back home in South Korea, he had wanted to be a government worker. But in this country, he needed a way to pay tuition.

His mother refused to send him cash because "I just spent it right away," Rhee recalled during an interview at the modest headquarters of Rhee Bros. Inc. in Columbia. So he sold stuffed animals and jewelry on the street and artificial flowers near the monuments in the District, turning a modest profit.

Then one day his mother sent him a wooden box with dried squid from the Kangwon province of South Korea, which is famous for its seafood. Rhee knew how difficult it was to find the squid in the United States, so he took it to a Japanese grocer who bought it for twice what his mother paid. It flew off the shelves, and the grocer came back asking for more.

"People have to eat," Rhee said he realized.

That transaction planted the seed for Rhee Bros., and Rhee went on to build a business that now supplies national grocers such as Giant Food LLC, Costco Wholesale Corp. and Safeway Inc. -- and mom-and-pop ethnic supermarkets -- with products ranging from noodles to sesame oil. The company produces private-label brands. And it operates supermarkets under the names Lotte Plaza and Assi Super -- in Rockville, Fairfax, Silver Spring and Ellicott City, with a fifth scheduled to open in Germantown in the spring -- and one each in California, New York, Georgia and Pennsylvania.

Rhee, 65, is still chairman and chief executive. His three younger brothers also have executive positions: Sung Kil Lee, 59, is in charge of the East Coast retail stores; Seung Kwan Rhee, 56, is vice president; and Sung Chul Rhee, 48, oversees the Los Angeles store. The company has 200 employees in the Washington area and 1,500 across the country. It brought in roughly $300 million in revenue last year and expects to hit $500 million by 2008. The company would not disclose other financial information.

"They dominate the Korean supermarkets in this area," said Young Kim, president of the Korean American Association of the Washington Metropolitan Area.

The growth of Rhee Bros. mirrors the rise in the number of Asian Americans in the United States over the past several decades. According to the latest estimate by the U.S. Census, there are more than 425,000 Asian Americans in the Washington area, about 8.3 percent of the population. In 2000, there were 330,000 -- 6.6 percent of the population. In 1990, there were just over 200,000 -- 5.2 percent of the population.

"The whole point of the growth of our business is immigration," said Phillip Ahn, project manager for Rhee Bros.

The company has long branched out beyond Korean food, serving other Asian ethnic groups such as Vietnamese, Chinese and Japanese. Recently, it has begun expanding into Hispanic food, sparked by the growth in the Latino population.

Asian Americans are a particularly lucrative market for food retailers. According to a recent report by MarketResearch.com, Asian Americans average 3.0 family members per household compared with 2.6 nationally. And they have the highest median household income of any racial group.