88. Fortune Cookies - The Economics of Everyday Things

Loading summary

Transcript81 lines

[00:00]
HubSpot Representative
With HubSpot's built in AI, you can get more done than ever before. Breeze agents help you do things in seconds that used to take hours and Copilot keeps you two steps ahead, giving you the right insights at the right time. Get started today@HubSpot.com AI and now a.
[00:17]
AT&T Business Representative
Next level moment from ATT Business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding. And International Sleep Day is tomorrow. Luckily, AT&T5G lets you you deal with any issues with ease. So the pillows will get delivered and everyone can sleep soundly, especially you. ATT 5G requires a compatible plan and device coverage not available everywhere. Learn more@att.com 5G Network at first glance.
[00:50]
Zachary Crockett
37Th street in Long Island City, New York looks a little down on its luck. On one side of the road, there's a strip of dilapidated warehouses and auto body shops. On the other, there's a cemetery where mafiosi are buried. You can hear mechanics drilling out tire bolts and cars honking on the nearby expressway. But inside of a white brick building on the corner, you'll find a place where, quite literally, fortunes are made.
[01:20]
Norman Wang
Alright, he who throws mud loses ground. A day without smiling is a day wasted. A clean conscience is a good pillow. People always hunger to feel that they're part of something greater. The cookie. You eat it, it's over in a minute. But it's the message that stays in your mind.
[01:46]
Zachary Crockett
That's Norman Wang. He's the CEO of Wonton Food, the largest manufacturer of fortune cookies in the world. Between its New York factory and additional facilities in Texas and Tennessee, it produces five and a half million of them every day. If you laid out their annual output of fortune cookies end to end, it would circle the globe two and a half times.
[02:10]
Norman Wang
We are most of the market, so primarily Chinese restaurants. They are the typical mom and pops that you see, but also national food chains.
[02:18]
Zachary Crockett
But it's not easy to be king of the fortune cookie. To keep your business alive, you have to convince restaurants to pay for a product that they give away for free. And even when you land a big contract, the profits might be measured in fractions of a penny per cookie.
[02:39]
Jennifer Lee
Fortune cookies are actually relatively complex, right? Because you have to make the cookie, you have to get the fortunes. You have to put the fortunes inside the cookies. You have to put them in plastic, you have to put them in Boxes. There's no margin in the generic fortune cookie.
[02:56]
Zachary Crockett
For the Freakonomics Radio network, this is the economics of everyday things. I'm Zachary Crockett. Today, fortune cookies. It's estimated that there are more than 45,000 Chinese restaurants in the United States. That's more than all McDonald's, Burger King, KFC and Wendy's locations combined. These restaurants range from your small family run business in Wichita, Kansas, to the Panda Express at your local strip mall. At many of these establishments, diners expect a fortune cookie at the end of the meal.
[03:33]
Jennifer Lee
So a modern day American fortune cookie is basically like if you imagine a Pac man and it became 3D, they're made in these little yellow discs and you just kind of fold them and inside are little pieces of paper.
[03:45]
Zachary Crockett
Jennifer Lee is the author of the Fortune Cookie Chronicles, a 2008 book that traces the history of American Chinese food. Like most of us, Lee, who is Chinese American herself, had always assumed that the fortune cookie's country of origin was obvious.
[04:03]
Jennifer Lee
I was born and raised in New York City, and so when we went to our local Chinese takeout, they would also give me fortune cookies. So I grew up thinking that fortune cookies were Chinese.
[04:14]
Zachary Crockett
Years later, Lee took a deeper look at fortune cookies, and she began to grow suspicious.
[04:22]
Jennifer Lee
Chinese food is actually generally terrible at desserts. We have mooncakes, which basically taste and look like hockey pucks or these weird rice porridge things with a lot of stuff floating around in it. It's like fungus and little berries. And it is an absolute disappointment. If you look at a fortune cookie and you look at the dessert tree of China, there is like no genetic ancestry, not even close.
[04:50]
Zachary Crockett
Li embarked on a journey to track down the birthplace of the fortune cookie. And in the course of her research, she found evidence that they likely originated in Japan in the mid 19th century. They were called sugiura senbei, or fortune crackers.
[05:07]
Jennifer Lee
They have a much nuttier miso flavor. They're bigger and browner, but if you see them side by side, you're like, oh, this is an unmistakable family resemblance. In the late 1800s, there were waves of Japanese immigrants that came to California, some of whom opened bakeries and made these things.
[05:29]
Zachary Crockett
How exactly those Japanese crackers ended up in Chinese restaurants in the United States is a little murky. A leading theory is that a Japanese bakery called Benkyodo sold them in San Francisco around 1906. One of their customers was Makoto Hagiwara, who ran the Japanese Tea Garden at Golden Gate Park. He started selling the cookies to local Chinese Restaurant owners who were trying to cater to American diners tastes.
[05:58]
Jennifer Lee
The American just expected desserts. And fortune cookies emerged as the quintessential quote unquote, Chinese dessert.
[06:12]
Zachary Crockett
During World War II, San Francisco was a major military port for ships to the Pacific. Soldiers came there from all over the country. And during their stay many were exposed for the first time to fortune cookies at Chinese restaurants.
[06:27]
Jennifer Lee
And so when they went back to the their local Chinese restaurants, they were like why don't you have the fortune cookies like they do in San Francisco or California? And these Chinese restaurant owners through the word of mouth network, they basically figure out what these fortune cookies were and did become an expectation.
[06:49]
Zachary Crockett
Lee says that when Japanese Americans were put in internment camps, Chinese business owners bought up many of the fortune cookie operations. By the 1960s, the government had introduced more favorable immigration policies that nearly doubled the Chinese American population. A wave of Chinese restaurants opened across the country and that meant many more fortune cookies.
[07:14]
Jennifer Lee
They just really caught fire in the United States.
[07:19]
Zachary Crockett
Initially, Chinese restaurants had to place orders with small family run fortune cookie factories in San Francisco and Los Angeles. The cookies were handmade and a top notch employee could fold around 750 cookies an hour. But eventually the demand grew so large that humans could no longer keep up.
[07:42]
Jennifer Lee
You go from something that originally was handcrafted, made in mom and pop shops to the point where there's machinery and automation and like industrial scale. No one chooses what Chinese restaurants are going to eat at by the fortune cookie. So it's basically a commodity product. It favors someone who can plug into a nationwide distribution network.
[08:05]
Zachary Crockett
Today's machines produce 8,000 fortune cookies an hour. Most of those family run cookie factories have been put out of business. And the industry is now dominated by a few giants, one of which controls the bulk of the market.
[08:21]
Jennifer Lee
You basically have one really big gorilla that makes fortunes, which is Wonton Food.
[08:27]
Norman Wang
We're talking about millions of cookies a day.
[08:30]
Zachary Crockett
Again, that's Norman Wang, the CEO of Won Ton Food. The company traces its roots back to his father, Ching Sun Wong, who immigrated to New York in the 1960s.
[08:43]
Norman Wang
Just a typical story, you know, came with very little money in his pocket, did the usual jobs, restaurant laundromat, construction. I guess he wasn't really good at that kind of work because he kind of got fired and rehired and so forth.
[08:57]
Zachary Crockett
But Ching sun possessed a special skill. His family members in China had taught him how to make noodles.
[09:05]
Norman Wang
His uncle said to him, as long as you hold on to this skill and craft of noodle making, you'll always be able to find a way to support yourself. He went around and borrowed money from a lot of people and that's when he started the noodle factory in Chinatown.
[09:18]
Zachary Crockett
Ching sun later expanded his business by acquiring a small fortune cookie factory and he began selling them to restaurants alongside his noodles. His son Norman took over as CEO in 2013. Today it's still a noodle company. It's also the nation's leading manufacturer of fortune cookies.
[09:40]
Norman Wang
We do dried noodles. We do the fried crispy noodles that you put into wonton soups or your salads. Also the skins that we use for dumplings, egg rolls, spring rolls. The product that we're most famous for is fortune cookies and those go out to Chinese restaurants around the country.
[09:58]
Zachary Crockett
We'll take a trip inside the fortune cookie factory after the break. The Economics of Everyday Things is sponsored by Acorns. April is Financial Literacy Month. That's right, they made a whole month reminding you to finally take control of your money. Good news is you don't need 30 days. Acorns makes it easy to start saving and investing for your future in just five minutes. You don't need to be an expert. Acorns will recommend a diversified portfolio that matches you and your money goals. You don't need to be rich. Acorns lets you get started with the spare money you have right now. Even if all you've got is spare change. Sign up now and join over 14 million all time customers who have already saved and invested over $25 billion with Acorns. Head to acorns.com economics or download the Acorns app to get started. Paid non client endorsement compensation provides incentive to positively promote Acorns Tier 1 compensation provided investing involves risk Acorns Advisors LLC, an SEC registered investment advisor. View important disclosures@acorns.com Economics the economics of Everyday Things is sponsored by Rosetta Stone. Learn Naturally. Speak Confidently Rosetta Stone helps you absorb a language the way you learned your first through real world context and conversation. No memorization, just practical skills you can use right away. Available on mobile and desktop, Rosetta Stone is designed to fully immerse you in your chosen language for a more natural and effective learning experience. Italian, German Korean Chinese with 30 years of experience, millions of users and 25 languages offered, Rosetta Stone is the Go to Language Learning solution. Perfect your pronunciation with built in truaxent speech recognition technology providing real time feedback to help you sound more natural. Unlock your learning potential. Today, the Economics of Everyday Things listeners can grab Rosetta Stone's lifetime membership for 50% off. That's unlimited access to 25 language courses for life. Visit RosettaStone.com economics to get started and claim your 50% off today. That's RosettaStone.com economics to start learning.
[12:39]
Jennifer Lee
For.
[12:40]
Chevrolet Representative
All of life's adventures, the all new 2025 Chevrolet Equinox is the SUV to help you do it. It's loaded with tech including an 11.3-inch diagonal touchscreen with easy access to your your apps, maps, music and more. And Equinox is now available in a brand new trim named Active, featuring a rugged off road inspired design for those whose passion begins where the pavement ends. The all new 2025 Chevy Equinox. It's everything you want in an SUV. Learn more at Chevy.com Equinox.
[13:12]
Zachary Crockett
In the bowels of the Wonton Food Factory in New York City, you'll find the fortune cookie version of Willy Wonka's Chocolate Fact. The fortune cookie process begins in a loading zone where 50 pound bags of dry ingredients are stacked up to the ceiling. The standard fortune cookie recipe is pretty simple flour, granulated sugar, vanilla flavoring, coloring agents and water. These ingredients go into giant stainless steel mixers for around 20 minutes.
[13:47]
Norman Wang
That's actually one key part is the mixing, making sure that the batter has the right combination of viscosity and strength.
[13:54]
Zachary Crockett
The mixed batter travels down a series of pipes that lead downstairs to the factory floor. Down here, a dozen rows of conveyor belts are in constant motion. The batter is squirted out from the pipes onto greased metal slabs as thin little pancakes. This process cooks the cakes and while they're still hot and malleable, a proprietary piece of machinery cuts a single fortune off a giant roll of pre printed phrases. In one descending motion, it lays the fortune onto the pancake and folds it into the shape we all know.
[14:33]
Norman Wang
It's made out of food grade paper and ink. As you know, little kids might, you.
[14:37]
Zachary Crockett
Know, people eat them.
[14:38]
Norman Wang
They might forget there's a little piece.
[14:40]
Zachary Crockett
Of paper in there so it's safe to eat.
[14:42]
Norman Wang
Oh, definitely, yeah.
[14:44]
Zachary Crockett
A fan cools the cookie and a different machine seals it in a wrapper with air. This whole process happens in a few seconds and as you stand there, you see an unrelenting stream of wrapped cookies flowing down the line. They're packed 350 apiece into cardboard boxes and loaded up to be distributed all over the country. Wonton Food produces fortune cookies under its own label, Golden Bowl. If you're at a local Chinese restaurant on the east coast, you might see their label printed on the package, but Wonton Food sells most of its cookies as white label products. Independent restaurants and big national chains put their own branding on the wrappers. So you may not even know you're eating a Wonton Food fortune cookie.
[15:34]
Norman Wang
There's a little bit of Wantai food, Golden Bull cookies out there, but not that much.
[15:38]
Zachary Crockett
Fortune cookies are usually free to us, the diners. Restaurants take on the cost and given the tight profit margins in the restaurant business, typically 3 to 5%, wonton food faces a lot of price sensitivity from its customers. They're only willing to spend so much on something they have to give away. On its website, Wonton Food sells boxes of 350 vanilla fortune cookies for $12.85 each. A little less than 4 cents per cookie. But for larger deals that go through a food distributor, the wholesale price is likely much lower. Jennifer Lee, the author of the Fortune Cookie Chronicles, says in some cases, fortune cookies may even be a loss leader.
[16:27]
Jennifer Lee
You have these companies, you know whether or not they make wonton skins or they make noodles and which are selling to the Chinese restaurants anyway. Once you have those sales accounts, it is not that expensive to then upsell and add additional products.
[16:48]
Zachary Crockett
One reason for the small margins is that fortune cookies are surprisingly labor intensive. You can automate the cookie baking process all you want, but the real product is that little slip of paper inside of it. And writing a good fortune is a process that cannot be rushed.
[17:10]
Jennifer Lee
Americans, if they don't like their fortune, they complain to the restaurant, the restaurant complains to the distributor. So there are all these pressures to only have happy anodyne fortunes because otherwise there's a bad tip at the end.
[17:26]
Zachary Crockett
Decades ago, fortune cookie writers figured out that many traditional Chinese sayings didn't necessarily translate well for an American audience.
[17:36]
Jennifer Lee
The Chinese sensibility and American sensibility do not always line up. So even if you put things that Chinese people said into the cookies, I don't know, an American audience would like them. So for example, the American perspective, the squeaky wheel gets to Greece. Speak up right? Call attention to your needs. Chinese, which means the bird whose head sticks out gets shot. And so very different attitude.
[18:04]
Zachary Crockett
When fortune cookies first became widely popular in the 1950s, many writers turned to the Chinese philosopher Confucius, and they took some liberties with his work.
[18:16]
Jennifer Lee
Confucius started saying things that he never said. Americans just thought he was like a wise man.
[18:21]
Zachary Crockett
And therefore Confucius said, today's fortunes have evolved, but the fundamentals of the message are still the same.
[18:29]
Norman Wang
Has to have a positive message. This is what comes at the End of the meal. Right. So it's something that has to give customers a little bit of joy so that they'll be encouraged to come back to the Chinese restaurant. There's the typical category, which is the predictive type, you know, like something's going to happen to you in the future. There's humorous ones. There's ones that are based on ancient Chinese philosophy. There's ones that are encouraging you. Words of inspiration.
[18:55]
Zachary Crockett
My favorite fortune I ever got. All it said was, someone is watching you from afar.
[19:00]
Norman Wang
Oh, yeah. Hopefully it keeps you on the straight and narrow.
[19:04]
Zachary Crockett
Wonton Food has employed a few chief Fortune writers over the years. They sift through quote books, philosophical texts, and social media to find short and snappy fortunes that fit the bill.
[19:19]
Norman Wang
Let me see, where is the list Here? Ah, here we go. Trust in your dreams. They hold your potential. Embrace your destiny and let go of fear and doubt. No snowflake in an avalanche ever feels responsible. Even the greatest of whales is helpless in the middle of a desert.
[19:42]
Zachary Crockett
Wonton Food now has a database of more than 10,000 fortunes, which it rotates in and out of circulation.
[19:50]
Norman Wang
We make millions of cookies a day, and, you know, we don't want a situation where you get the same message. We're constantly reviewing the database of fortune messages to make sure that it's something fresh.
[20:01]
Zachary Crockett
At times, the writers at Wonton Food have gotten a little too experimental. In the mid-2000s, they wrote a series of more ominous fortunes. Diners across the country were getting notes like, today is a disastrous day or there might be a crisis looming. That one, by the way, debuted a few months before the Great Recession.
[20:24]
Norman Wang
There's cultural mores that evolve over time in our society. So whatever's going on in the zeitgeist, we have to make sure the cookies reflect that.
[20:35]
Zachary Crockett
Just as consequential is what's on the back of a fortune. If you flip one over, you'll often find a set of six lucky numbers. Wonton Food was the first company to do this. Wong says many people use those numbers to enter the lottery, and it's not uncommon for them to strike it big.
[20:54]
Norman Wang
Oh, yeah, that happens, like, every month. We can't even keep track of it.
[20:58]
Zachary Crockett
In 2005, 110 people all over the country won $19 million in the Powerball lottery by using the lucky numbers on the back of a Wonton Food fortune cookie. Wang says the company got a visit from skeptical lottery officials.
[21:14]
Norman Wang
They came here, interviewed us. Initially, they thought, what was going on here? Yeah. And then once they reviewed our process, they realized it was just the magic of fortune cookies.
[21:24]
Zachary Crockett
In recent years, Wang has tried to introduce the magic of fortune cookies to other countries. As Chinese immigrants have spread around the world, so too have Chinese restaurants. And by proxy, the international demand for fortune cookies. You can now find them in Europe, South America, Africa, and Australia. But one place that has resisted the fortune cookie is China. In the 90s, wonton food tried to introduce fortune cookies there, but they abandoned the project due to lack of interest. The cookies, as it turns out, were just too American.
[22:02]
Jennifer Lee
If you ever bring a whole bag of fortune cookies to China and you just give them to people, they'll pop them in their mouth and they're like, whoa, whoa, what's this? Americans are so strange. Like, why are they putting pieces of paper in their food?
[22:15]
Zachary Crockett
For Jennifer Lee, the answer to that question is clear.
[22:20]
Jennifer Lee
It's a non religious, non woo woo way to believe that there's a larger cosmic framework. You can get a fortune and it feels like a personal message, even though in reality that fortune was probably printed 10,000 times in a factory. But it feels like it's a custom message from the cosmos to you delivered in a little cute package. There's something about that whole ritual that. That makes you believe there's a pattern to the madness of the universe.
[22:55]
Zachary Crockett
And Norman Wang is happy to keep the tradition alive.
[23:00]
Norman Wang
People put it on their computer, they put it on their refrigerators, put it in their wallets. It's a message that sticks with them. This little piece of paper that's been folded into a cookie dough brings so much joy, and it gives people an opportunity to reflect and then also sparks dinner conversations. I think that's what people crave. They want something that's not just a physical product. They want something that inspires them. A message that they can share. Yeah. And they're fun.
[23:31]
Zachary Crockett
For the economics of everyday things. I'm Zachary Crockett. This episode was produced by me and Sarah Lilly and mixed by Jeremy Johnston. We had help from Daniel Moritz Rapson and thanks to our listeners, Liam Kahn, Sean Gleason, and Jeff Frankel for suggesting this topic. If you have an idea for an episode, feel free to email us@everyday thingsreakonomics.com Our inbox is always open. All right, until next week.
[24:06]
Jennifer Lee
Love is a warm fire to keep the soul warm. I don't know. I don't know. I'm not feeling that one so much warm twice. This is not the most elegant.
[24:18]
Zachary Crockett
The Freakonomics Radio Network.
[24:21]
All Modern Representative
The hidden side of everything.
[24:26]
Chevrolet Representative
Stitcher.
[24:32]
All Modern Representative
Hi, we're all Modern we're here to help you refresh your space for spring. With the best of modern furniture and decor all in one place, our team of modern obsessed experts hand vets each design for quality. Plus we offer fast and free shipping that's modern made for real life. Shop now@allmodern.com Growing a business can feel.
[24:55]
HubSpot Representative
Impossible, but with HubSpot's built in AI, you can get more done than ever before, which means anything's possible. Breeze agents help you do things in seconds that used to take hours, providing the customer support of 5 us generating the content of 10 us. And Breeze Copilot keeps you two steps ahead, giving you the right insights at the right time to close more deals than ever. HubSpot Impossible Growth made Impossibly easy get started today@HubSpot.com AI the last thing you want to hear when you need your auto insurance most is a robot with countless irrelevant menu options. Which is why with Usaai Auto Insurance, you'll get great service that is easy and reliable, all at the touch of a button. Get a quote today Restrictions apply.

Summary4 min read

Summary of Podcast Episode 88: "Fortune Cookies" The Economics of Everyday Things
Host: Zachary Crockett
Guests: Jennifer Lee (Author of Fortune Cookie Chronicles), Norman Wang (CEO of Wonton Food)
Release Date: April 14, 2025

Introduction

In episode 88 of The Economics of Everyday Things, host Zachary Crockett delves into the intriguing world of fortune cookies. Far from being a simple post-meal treat, fortune cookies represent a fascinating intersection of culture, business, and economics. This episode explores their origins, production, economic significance, and cultural impact through insightful conversations with Jennifer Lee and Norman Wang.

Origins and History of Fortune Cookies

The episode begins with an exploration of the true origins of fortune cookies, challenging the common belief that they are inherently Chinese. Jennifer Lee, author of Fortune Cookie Chronicles, sheds light on her research:

Jennifer Lee (04:02): "Chinese food is actually generally terrible at desserts. We have mooncakes, which basically taste and look like hockey pucks... When I looked at the fortune cookie and the dessert tree of China, there was no genetic ancestry, not even close."

Lee's investigation reveals that fortune cookies likely originated in Japan in the mid-19th century as sugiura senbei or fortune crackers. Japanese immigrants in California introduced them around 1906, where they were adopted by Chinese restaurants to cater to American tastes. This fusion became popular among American soldiers during World War II, solidifying their place in Chinese-American cuisine.

Wonton Food and the Fortune Cookie Industry

Norman Wang, CEO of Wonton Food—the largest fortune cookie manufacturer—provides an insider’s perspective on the industry’s evolution:

Norman Wang (08:21): "We're talking about millions of cookies a day."

Wonton Food, founded by Wang's father in the 1960s, transitioned from a noodle company to a dominant player in the fortune cookie market. Despite the industry's competitive nature, Wonton Food controls a significant market share, producing over five and a half million fortune cookies daily across facilities in New York, Texas, and Tennessee.

Production Process and Business Challenges

The episode offers a detailed look into the manufacturing process of fortune cookies, highlighting the blend of automation and craftsmanship required:

Norman Wang (13:46): "That's actually one key part is the mixing, making sure that the batter has the right combination of viscosity and strength."

The production involves mixing ingredients, shaping the cookies while hot, inserting fortunes, and packaging them efficiently. Despite automation enabling the production of 8,000 cookies per hour, the true challenge lies in creating meaningful and appealing fortunes—an aspect that remains labor-intensive and crucial for maintaining consumer satisfaction.

Economic Significance and Market Dynamics

Wonton Food operates in a market with thin profit margins due to the commodity nature of fortune cookies. Restaurants expect these cookies as a free addition to their meals, compounding the economic pressures:

Jennifer Lee (16:26): "Once you have those sales accounts, it is not that expensive to then upsell and add additional products."

Prices are negotiable, often less than 4 cents per cookie, especially for bulk orders. The industry's reliance on a few major players like Wonton Food makes it highly competitive and price-sensitive.

Fortune Cookie Messages and Cultural Significance

A unique aspect of fortune cookies is the messages they contain. Wonton Food maintains a database of over 10,000 fortunes to ensure variety and relevance:

Norman Wang (19:42): "Trust in your dreams. They hold your potential. Embrace your destiny and let go of fear and doubt."

However, crafting these messages is challenging. They must resonate with American sensibilities while maintaining a semblance of Chinese philosophical roots. Past experiments with ominous fortunes even coincided with the Great Recession, highlighting the delicate balance required in message crafting.

Distribution and Market Reach

Wonton Food’s distribution network is extensive, supplying fortunes to over 45,000 Chinese restaurants across the United States, surpassing major fast-food chains in number. While efforts to globalize have met with limited success—particularly in China, where the concept remains foreign—the spread of Chinese restaurants internationally has gradually increased the demand for fortune cookies.

Cultural Impact and Consumer Perception

Jennifer Lee discusses the mystical allure of fortune cookies:

Jennifer Lee (22:19): "It's a non-religious, non-woo-woo way to believe that there's a larger cosmic framework... It feels like a custom message from the cosmos to you."

Fortune cookies offer a moment of reflection and joy, serving as conversation starters and personal inspirations for diners. Despite their commercial origins, they hold a special place in the dining experience, symbolizing a blend of culture and personal connection.

Conclusion

The episode concludes by emphasizing the enduring popularity and economic significance of fortune cookies. Through the expertise of Jennifer Lee and Norman Wang, listeners gain a comprehensive understanding of how these seemingly simple treats are embedded in cultural practices and economic frameworks. Fortune cookies exemplify how everyday items can carry rich histories and complex economic stories, making them a perfect subject for exploring the economics of daily life.

Norman Wang (22:59): "This little piece of paper that's been folded into a cookie dough brings so much joy, and it gives people an opportunity to reflect and then also sparks dinner conversations."

Notable Quotes:

Jennifer Lee (04:02): "Chinese food is actually generally terrible at desserts."
Norman Wang (08:21): "We're talking about millions of cookies a day."
Norman Wang (19:42): "Trust in your dreams. They hold your potential."
Jennifer Lee (22:19): "It's a non-religious, non-woo-woo way to believe that there's a larger cosmic framework."
Norman Wang (22:59): "This little piece of paper that's been folded into a cookie dough brings so much joy."

This episode offers a compelling exploration of fortune cookies beyond their sweet exterior, uncovering the intricate balance of culture, business, and consumer behavior that sustains their presence in American dining.

Loading summary

Transcript81 lines

[00:00]
HubSpot Representative
With HubSpot's built in AI, you can get more done than ever before. Breeze agents help you do things in seconds that used to take hours and Copilot keeps you two steps ahead, giving you the right insights at the right time. Get started today@HubSpot.com AI and now a.
[00:17]
AT&T Business Representative
Next level moment from ATT Business. Say you've sent out a gigantic shipment of pillows and they need to be there in time for International Sleep day. You've got AT and T5G so you're fully confident, but the vendor isn't responding. And International Sleep Day is tomorrow. Luckily, AT&T5G lets you you deal with any issues with ease. So the pillows will get delivered and everyone can sleep soundly, especially you. ATT 5G requires a compatible plan and device coverage not available everywhere. Learn more@att.com 5G Network at first glance.
[00:50]
Zachary Crockett
37Th street in Long Island City, New York looks a little down on its luck. On one side of the road, there's a strip of dilapidated warehouses and auto body shops. On the other, there's a cemetery where mafiosi are buried. You can hear mechanics drilling out tire bolts and cars honking on the nearby expressway. But inside of a white brick building on the corner, you'll find a place where, quite literally, fortunes are made.
[01:20]
Norman Wang
Alright, he who throws mud loses ground. A day without smiling is a day wasted. A clean conscience is a good pillow. People always hunger to feel that they're part of something greater. The cookie. You eat it, it's over in a minute. But it's the message that stays in your mind.
[01:46]
Zachary Crockett
That's Norman Wang. He's the CEO of Wonton Food, the largest manufacturer of fortune cookies in the world. Between its New York factory and additional facilities in Texas and Tennessee, it produces five and a half million of them every day. If you laid out their annual output of fortune cookies end to end, it would circle the globe two and a half times.
[02:10]
Norman Wang
We are most of the market, so primarily Chinese restaurants. They are the typical mom and pops that you see, but also national food chains.
[02:18]
Zachary Crockett
But it's not easy to be king of the fortune cookie. To keep your business alive, you have to convince restaurants to pay for a product that they give away for free. And even when you land a big contract, the profits might be measured in fractions of a penny per cookie.
[02:39]
Jennifer Lee
Fortune cookies are actually relatively complex, right? Because you have to make the cookie, you have to get the fortunes. You have to put the fortunes inside the cookies. You have to put them in plastic, you have to put them in Boxes. There's no margin in the generic fortune cookie.
[02:56]
Zachary Crockett
For the Freakonomics Radio network, this is the economics of everyday things. I'm Zachary Crockett. Today, fortune cookies. It's estimated that there are more than 45,000 Chinese restaurants in the United States. That's more than all McDonald's, Burger King, KFC and Wendy's locations combined. These restaurants range from your small family run business in Wichita, Kansas, to the Panda Express at your local strip mall. At many of these establishments, diners expect a fortune cookie at the end of the meal.
[03:33]
Jennifer Lee
So a modern day American fortune cookie is basically like if you imagine a Pac man and it became 3D, they're made in these little yellow discs and you just kind of fold them and inside are little pieces of paper.
[03:45]
Zachary Crockett
Jennifer Lee is the author of the Fortune Cookie Chronicles, a 2008 book that traces the history of American Chinese food. Like most of us, Lee, who is Chinese American herself, had always assumed that the fortune cookie's country of origin was obvious.
[04:03]
Jennifer Lee
I was born and raised in New York City, and so when we went to our local Chinese takeout, they would also give me fortune cookies. So I grew up thinking that fortune cookies were Chinese.
[04:14]
Zachary Crockett
Years later, Lee took a deeper look at fortune cookies, and she began to grow suspicious.
[04:22]
Jennifer Lee
Chinese food is actually generally terrible at desserts. We have mooncakes, which basically taste and look like hockey pucks or these weird rice porridge things with a lot of stuff floating around in it. It's like fungus and little berries. And it is an absolute disappointment. If you look at a fortune cookie and you look at the dessert tree of China, there is like no genetic ancestry, not even close.
[04:50]
Zachary Crockett
Li embarked on a journey to track down the birthplace of the fortune cookie. And in the course of her research, she found evidence that they likely originated in Japan in the mid 19th century. They were called sugiura senbei, or fortune crackers.
[05:07]
Jennifer Lee
They have a much nuttier miso flavor. They're bigger and browner, but if you see them side by side, you're like, oh, this is an unmistakable family resemblance. In the late 1800s, there were waves of Japanese immigrants that came to California, some of whom opened bakeries and made these things.
[05:29]
Zachary Crockett
How exactly those Japanese crackers ended up in Chinese restaurants in the United States is a little murky. A leading theory is that a Japanese bakery called Benkyodo sold them in San Francisco around 1906. One of their customers was Makoto Hagiwara, who ran the Japanese Tea Garden at Golden Gate Park. He started selling the cookies to local Chinese Restaurant owners who were trying to cater to American diners tastes.
[05:58]
Jennifer Lee
The American just expected desserts. And fortune cookies emerged as the quintessential quote unquote, Chinese dessert.
[06:12]
Zachary Crockett
During World War II, San Francisco was a major military port for ships to the Pacific. Soldiers came there from all over the country. And during their stay many were exposed for the first time to fortune cookies at Chinese restaurants.
[06:27]
Jennifer Lee
And so when they went back to the their local Chinese restaurants, they were like why don't you have the fortune cookies like they do in San Francisco or California? And these Chinese restaurant owners through the word of mouth network, they basically figure out what these fortune cookies were and did become an expectation.
[06:49]
Zachary Crockett
Lee says that when Japanese Americans were put in internment camps, Chinese business owners bought up many of the fortune cookie operations. By the 1960s, the government had introduced more favorable immigration policies that nearly doubled the Chinese American population. A wave of Chinese restaurants opened across the country and that meant many more fortune cookies.
[07:14]
Jennifer Lee
They just really caught fire in the United States.
[07:19]
Zachary Crockett
Initially, Chinese restaurants had to place orders with small family run fortune cookie factories in San Francisco and Los Angeles. The cookies were handmade and a top notch employee could fold around 750 cookies an hour. But eventually the demand grew so large that humans could no longer keep up.
[07:42]
Jennifer Lee
You go from something that originally was handcrafted, made in mom and pop shops to the point where there's machinery and automation and like industrial scale. No one chooses what Chinese restaurants are going to eat at by the fortune cookie. So it's basically a commodity product. It favors someone who can plug into a nationwide distribution network.
[08:05]
Zachary Crockett
Today's machines produce 8,000 fortune cookies an hour. Most of those family run cookie factories have been put out of business. And the industry is now dominated by a few giants, one of which controls the bulk of the market.
[08:21]
Jennifer Lee
You basically have one really big gorilla that makes fortunes, which is Wonton Food.
[08:27]
Norman Wang
We're talking about millions of cookies a day.
[08:30]
Zachary Crockett
Again, that's Norman Wang, the CEO of Won Ton Food. The company traces its roots back to his father, Ching Sun Wong, who immigrated to New York in the 1960s.
[08:43]
Norman Wang
Just a typical story, you know, came with very little money in his pocket, did the usual jobs, restaurant laundromat, construction. I guess he wasn't really good at that kind of work because he kind of got fired and rehired and so forth.
[08:57]
Zachary Crockett
But Ching sun possessed a special skill. His family members in China had taught him how to make noodles.
[09:05]
Norman Wang
His uncle said to him, as long as you hold on to this skill and craft of noodle making, you'll always be able to find a way to support yourself. He went around and borrowed money from a lot of people and that's when he started the noodle factory in Chinatown.
[09:18]
Zachary Crockett
Ching sun later expanded his business by acquiring a small fortune cookie factory and he began selling them to restaurants alongside his noodles. His son Norman took over as CEO in 2013. Today it's still a noodle company. It's also the nation's leading manufacturer of fortune cookies.
[09:40]
Norman Wang
We do dried noodles. We do the fried crispy noodles that you put into wonton soups or your salads. Also the skins that we use for dumplings, egg rolls, spring rolls. The product that we're most famous for is fortune cookies and those go out to Chinese restaurants around the country.
[09:58]
Zachary Crockett
We'll take a trip inside the fortune cookie factory after the break. The Economics of Everyday Things is sponsored by Acorns. April is Financial Literacy Month. That's right, they made a whole month reminding you to finally take control of your money. Good news is you don't need 30 days. Acorns makes it easy to start saving and investing for your future in just five minutes. You don't need to be an expert. Acorns will recommend a diversified portfolio that matches you and your money goals. You don't need to be rich. Acorns lets you get started with the spare money you have right now. Even if all you've got is spare change. Sign up now and join over 14 million all time customers who have already saved and invested over $25 billion with Acorns. Head to acorns.com economics or download the Acorns app to get started. Paid non client endorsement compensation provides incentive to positively promote Acorns Tier 1 compensation provided investing involves risk Acorns Advisors LLC, an SEC registered investment advisor. View important disclosures@acorns.com Economics the economics of Everyday Things is sponsored by Rosetta Stone. Learn Naturally. Speak Confidently Rosetta Stone helps you absorb a language the way you learned your first through real world context and conversation. No memorization, just practical skills you can use right away. Available on mobile and desktop, Rosetta Stone is designed to fully immerse you in your chosen language for a more natural and effective learning experience. Italian, German Korean Chinese with 30 years of experience, millions of users and 25 languages offered, Rosetta Stone is the Go to Language Learning solution. Perfect your pronunciation with built in truaxent speech recognition technology providing real time feedback to help you sound more natural. Unlock your learning potential. Today, the Economics of Everyday Things listeners can grab Rosetta Stone's lifetime membership for 50% off. That's unlimited access to 25 language courses for life. Visit RosettaStone.com economics to get started and claim your 50% off today. That's RosettaStone.com economics to start learning.
[12:39]
Jennifer Lee
For.
[12:40]
Chevrolet Representative
All of life's adventures, the all new 2025 Chevrolet Equinox is the SUV to help you do it. It's loaded with tech including an 11.3-inch diagonal touchscreen with easy access to your your apps, maps, music and more. And Equinox is now available in a brand new trim named Active, featuring a rugged off road inspired design for those whose passion begins where the pavement ends. The all new 2025 Chevy Equinox. It's everything you want in an SUV. Learn more at Chevy.com Equinox.
[13:12]
Zachary Crockett
In the bowels of the Wonton Food Factory in New York City, you'll find the fortune cookie version of Willy Wonka's Chocolate Fact. The fortune cookie process begins in a loading zone where 50 pound bags of dry ingredients are stacked up to the ceiling. The standard fortune cookie recipe is pretty simple flour, granulated sugar, vanilla flavoring, coloring agents and water. These ingredients go into giant stainless steel mixers for around 20 minutes.
[13:47]
Norman Wang
That's actually one key part is the mixing, making sure that the batter has the right combination of viscosity and strength.
[13:54]
Zachary Crockett
The mixed batter travels down a series of pipes that lead downstairs to the factory floor. Down here, a dozen rows of conveyor belts are in constant motion. The batter is squirted out from the pipes onto greased metal slabs as thin little pancakes. This process cooks the cakes and while they're still hot and malleable, a proprietary piece of machinery cuts a single fortune off a giant roll of pre printed phrases. In one descending motion, it lays the fortune onto the pancake and folds it into the shape we all know.
[14:33]
Norman Wang
It's made out of food grade paper and ink. As you know, little kids might, you.
[14:37]
Zachary Crockett
Know, people eat them.
[14:38]
Norman Wang
They might forget there's a little piece.
[14:40]
Zachary Crockett
Of paper in there so it's safe to eat.
[14:42]
Norman Wang
Oh, definitely, yeah.
[14:44]
Zachary Crockett
A fan cools the cookie and a different machine seals it in a wrapper with air. This whole process happens in a few seconds and as you stand there, you see an unrelenting stream of wrapped cookies flowing down the line. They're packed 350 apiece into cardboard boxes and loaded up to be distributed all over the country. Wonton Food produces fortune cookies under its own label, Golden Bowl. If you're at a local Chinese restaurant on the east coast, you might see their label printed on the package, but Wonton Food sells most of its cookies as white label products. Independent restaurants and big national chains put their own branding on the wrappers. So you may not even know you're eating a Wonton Food fortune cookie.
[15:34]
Norman Wang
There's a little bit of Wantai food, Golden Bull cookies out there, but not that much.
[15:38]
Zachary Crockett
Fortune cookies are usually free to us, the diners. Restaurants take on the cost and given the tight profit margins in the restaurant business, typically 3 to 5%, wonton food faces a lot of price sensitivity from its customers. They're only willing to spend so much on something they have to give away. On its website, Wonton Food sells boxes of 350 vanilla fortune cookies for $12.85 each. A little less than 4 cents per cookie. But for larger deals that go through a food distributor, the wholesale price is likely much lower. Jennifer Lee, the author of the Fortune Cookie Chronicles, says in some cases, fortune cookies may even be a loss leader.
[16:27]
Jennifer Lee
You have these companies, you know whether or not they make wonton skins or they make noodles and which are selling to the Chinese restaurants anyway. Once you have those sales accounts, it is not that expensive to then upsell and add additional products.
[16:48]
Zachary Crockett
One reason for the small margins is that fortune cookies are surprisingly labor intensive. You can automate the cookie baking process all you want, but the real product is that little slip of paper inside of it. And writing a good fortune is a process that cannot be rushed.
[17:10]
Jennifer Lee
Americans, if they don't like their fortune, they complain to the restaurant, the restaurant complains to the distributor. So there are all these pressures to only have happy anodyne fortunes because otherwise there's a bad tip at the end.
[17:26]
Zachary Crockett
Decades ago, fortune cookie writers figured out that many traditional Chinese sayings didn't necessarily translate well for an American audience.
[17:36]
Jennifer Lee
The Chinese sensibility and American sensibility do not always line up. So even if you put things that Chinese people said into the cookies, I don't know, an American audience would like them. So for example, the American perspective, the squeaky wheel gets to Greece. Speak up right? Call attention to your needs. Chinese, which means the bird whose head sticks out gets shot. And so very different attitude.
[18:04]
Zachary Crockett
When fortune cookies first became widely popular in the 1950s, many writers turned to the Chinese philosopher Confucius, and they took some liberties with his work.
[18:16]
Jennifer Lee
Confucius started saying things that he never said. Americans just thought he was like a wise man.
[18:21]
Zachary Crockett
And therefore Confucius said, today's fortunes have evolved, but the fundamentals of the message are still the same.
[18:29]
Norman Wang
Has to have a positive message. This is what comes at the End of the meal. Right. So it's something that has to give customers a little bit of joy so that they'll be encouraged to come back to the Chinese restaurant. There's the typical category, which is the predictive type, you know, like something's going to happen to you in the future. There's humorous ones. There's ones that are based on ancient Chinese philosophy. There's ones that are encouraging you. Words of inspiration.
[18:55]
Zachary Crockett
My favorite fortune I ever got. All it said was, someone is watching you from afar.
[19:00]
Norman Wang
Oh, yeah. Hopefully it keeps you on the straight and narrow.
[19:04]
Zachary Crockett
Wonton Food has employed a few chief Fortune writers over the years. They sift through quote books, philosophical texts, and social media to find short and snappy fortunes that fit the bill.
[19:19]
Norman Wang
Let me see, where is the list Here? Ah, here we go. Trust in your dreams. They hold your potential. Embrace your destiny and let go of fear and doubt. No snowflake in an avalanche ever feels responsible. Even the greatest of whales is helpless in the middle of a desert.
[19:42]
Zachary Crockett
Wonton Food now has a database of more than 10,000 fortunes, which it rotates in and out of circulation.
[19:50]
Norman Wang
We make millions of cookies a day, and, you know, we don't want a situation where you get the same message. We're constantly reviewing the database of fortune messages to make sure that it's something fresh.
[20:01]
Zachary Crockett
At times, the writers at Wonton Food have gotten a little too experimental. In the mid-2000s, they wrote a series of more ominous fortunes. Diners across the country were getting notes like, today is a disastrous day or there might be a crisis looming. That one, by the way, debuted a few months before the Great Recession.
[20:24]
Norman Wang
There's cultural mores that evolve over time in our society. So whatever's going on in the zeitgeist, we have to make sure the cookies reflect that.
[20:35]
Zachary Crockett
Just as consequential is what's on the back of a fortune. If you flip one over, you'll often find a set of six lucky numbers. Wonton Food was the first company to do this. Wong says many people use those numbers to enter the lottery, and it's not uncommon for them to strike it big.
[20:54]
Norman Wang
Oh, yeah, that happens, like, every month. We can't even keep track of it.
[20:58]
Zachary Crockett
In 2005, 110 people all over the country won $19 million in the Powerball lottery by using the lucky numbers on the back of a Wonton Food fortune cookie. Wang says the company got a visit from skeptical lottery officials.
[21:14]
Norman Wang
They came here, interviewed us. Initially, they thought, what was going on here? Yeah. And then once they reviewed our process, they realized it was just the magic of fortune cookies.
[21:24]
Zachary Crockett
In recent years, Wang has tried to introduce the magic of fortune cookies to other countries. As Chinese immigrants have spread around the world, so too have Chinese restaurants. And by proxy, the international demand for fortune cookies. You can now find them in Europe, South America, Africa, and Australia. But one place that has resisted the fortune cookie is China. In the 90s, wonton food tried to introduce fortune cookies there, but they abandoned the project due to lack of interest. The cookies, as it turns out, were just too American.
[22:02]
Jennifer Lee
If you ever bring a whole bag of fortune cookies to China and you just give them to people, they'll pop them in their mouth and they're like, whoa, whoa, what's this? Americans are so strange. Like, why are they putting pieces of paper in their food?
[22:15]
Zachary Crockett
For Jennifer Lee, the answer to that question is clear.
[22:20]
Jennifer Lee
It's a non religious, non woo woo way to believe that there's a larger cosmic framework. You can get a fortune and it feels like a personal message, even though in reality that fortune was probably printed 10,000 times in a factory. But it feels like it's a custom message from the cosmos to you delivered in a little cute package. There's something about that whole ritual that. That makes you believe there's a pattern to the madness of the universe.
[22:55]
Zachary Crockett
And Norman Wang is happy to keep the tradition alive.
[23:00]
Norman Wang
People put it on their computer, they put it on their refrigerators, put it in their wallets. It's a message that sticks with them. This little piece of paper that's been folded into a cookie dough brings so much joy, and it gives people an opportunity to reflect and then also sparks dinner conversations. I think that's what people crave. They want something that's not just a physical product. They want something that inspires them. A message that they can share. Yeah. And they're fun.
[23:31]
Zachary Crockett
For the economics of everyday things. I'm Zachary Crockett. This episode was produced by me and Sarah Lilly and mixed by Jeremy Johnston. We had help from Daniel Moritz Rapson and thanks to our listeners, Liam Kahn, Sean Gleason, and Jeff Frankel for suggesting this topic. If you have an idea for an episode, feel free to email us@everyday thingsreakonomics.com Our inbox is always open. All right, until next week.
[24:06]
Jennifer Lee
Love is a warm fire to keep the soul warm. I don't know. I don't know. I'm not feeling that one so much warm twice. This is not the most elegant.
[24:18]
Zachary Crockett
The Freakonomics Radio Network.
[24:21]
All Modern Representative
The hidden side of everything.
[24:26]
Chevrolet Representative
Stitcher.
[24:32]
All Modern Representative
Hi, we're all Modern we're here to help you refresh your space for spring. With the best of modern furniture and decor all in one place, our team of modern obsessed experts hand vets each design for quality. Plus we offer fast and free shipping that's modern made for real life. Shop now@allmodern.com Growing a business can feel.
[24:55]
HubSpot Representative
Impossible, but with HubSpot's built in AI, you can get more done than ever before, which means anything's possible. Breeze agents help you do things in seconds that used to take hours, providing the customer support of 5 us generating the content of 10 us. And Breeze Copilot keeps you two steps ahead, giving you the right insights at the right time to close more deals than ever. HubSpot Impossible Growth made Impossibly easy get started today@HubSpot.com AI the last thing you want to hear when you need your auto insurance most is a robot with countless irrelevant menu options. Which is why with Usaai Auto Insurance, you'll get great service that is easy and reliable, all at the touch of a button. Get a quote today Restrictions apply.