Future Shift

Texas hasn't been the biggest state in terms of land area since Alaska earned statehood in 1959, and although it passed New York in the 1990s to become the second most populous state, it isn't likely to ever catch up to California as the population leader. But with projections from the Census Bureau of 21.5 million residents in 2005, a figure that's 6.8 percent higher than the bureau's 2000 projections, Texas is growing and changing with an alacrity that belies its bulk.

Texas' population growth will be characterized by a balanced combination of natural increase and immigration as the state's strong economy attracts new residents and its younger-than-average population generates a relatively high number of births.

"Increasingly in the next century, Texas' model consumer is likely to be a younger adult of minority heritage," says Steve Murdock, chief demographer at the Texas State Data Center at Texas A&M University in College Station. Texas will become a minority-majority state in about 2008, says Murdock, thanks largely to rapid growth in the Latino population.

Penny McConnell's customer base isn't waiting for the 21st century before it diversifies. McConnell, the 47-year-old owner of Penny's Pastries specialty bakery in Austin, says that tying her products to holidays, always an important strategy, is becoming increasingly complex as the variety of ethnic customs her customers observe broadens.

"We get calls now for everything from Kwanza cookies to [pastries for] the Chinese New Year," McConnell says. "When we started five years ago, we weren't making any cookies that celebrated anything in the Jewish religion. Now we do, and it's in a big way."

Another, more surprising trend is one that doesn't show up in Census Bureau surveys. McConnell says the healthy eating trend may have run its course in Texas. "I used to get more calls about nutrition and ingredients," she says. "But that doesn't seem to come up as often anymore."

This article was originally published in the September 1999 print edition of Entrepreneur with the headline: Future Shift.