CPJ plans expansion of Montego Bay warehouse

Business reporter

Wednesday, September 20, 2017

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Liquor and food purveyor Caribbean Producers Jamaica Ltd (CPJ) plans to expand its warehouse space by 68,000 square feet as it seeks to meet increased demand while improving efficiencies in distribution.

Managing director of CPJ, Dr David Lowe, told the Jamaica Observer that the company in the short term anticipates onshore activities to continue to generate compounded annual growth rate, while offshore growth will be driven by increased exports of the company's locally manufactured products.

Lowe noted that it is still early days to disclose how much the company will be pumping in the new facility or specific plans for the offshore growth strategy. However, he confirmed that CPJ is aggressively exploring opportunities that make business sense.

“Further penetration into other regional markets will be done with strategic partnerships,” he said, in anticipation that there will be increased growth in the hotel and tourism sector both locally and internationally.

CPJ, which has distinguished itself as the premier food service distributor, currently operates from a 135,000-square-feet warehouse facility in Montego Bay. Plans are to get the facility up to 203,000 square feet by year end 2018.

“We are continuing with the next phase of our strategic plan to increase manufacturing and distribution capacity along with the deployment of additional technology. We anticipate the result will enable us to continue to be considered a purveyor of choice for major institutional business partners such as the hotels chains,” Lowe told the Business Observer.

Having won eight awards over the last 15 years, CPJ was again recognised for the coveted Jamaica Hospitality and Tourism Association Purveyor of the Year award.

Despite its achievements, the company found itself in deep waters and initiated a restructuring of its business model last year.

“We made a decision to exit from some non-core business units that were not complementary or best fit with our portfolio, such as chemicals. We refocused our strategy to regain market share of key categories in our portfolio with initiatives which enabled us to grow gross revenues and sales in core business; this includes what we regained — the regained US$2 million lost from the chemical business,” Lowe reasoned.

Improved profitability of the company was, however, driven by process improvements and cost containment.

“The size of our business involves considerable logistics and supply chain operations where inefficiencies can be impactful on cost. Therefore, we implemented new technology and re-engineered some of our processes for greater efficiency,” the managing director said.

Executive Chairman Mark Hart reckons that growth in the hotel and tourism industry is promising, and that being a significant partner and service provider to this industry over 25 years has led to the company evolving with the major hotels.

“We are continuing with our aim to achieve responsible growth in current and new markets,” he said.

CPJ started supplying goods to the hotel sector in 1994 with the distribution of a brand of toilet paper from a 10,000-sqare-foot warehouse located at the LOJ Complex at Montego Freeport. In 2000, the company entered the distribution market for selling seafood and dairy products after the construction of a 1,000-square-foot freezer at the complex, and later moved its head office to Guinep Way, Montego Freeport.

The company also operates a Coke bottling plant in St Lucia.

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