Dixie Lee challenges KFC

By Julian Richardson Assistant Business Co-ordinator richardsonj@jamaicaobserver.com

Wednesday, February 22, 2012

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A Canadian fast-food franchise will open its doors in Portmore on Saturday, aiming to gobble up shares of a market dominated by KFC.

Dixie Lee, known for its fried chicken, is a franchised quick-services restaurant founded in Ontario, Canada in 1964. It has over 80 establishments across the world, more recently opening outlets in The United Arab Emirates and Guyana. Now, a group of overseas-based Jamaican investors has brought the franchise to Jamaica, pumping US$500,000 ($43.5 million) into a 1,500 square-foot restaurant in the Portmore Pines Plaza, a busy shopping complex in the fastest-growing city in the Caribbean.

"We thought that it would be a good venture for us because people love chicken here in Jamaica," said Elisha Smellie, a former chef and leader of the investment group.

St Mary-born Smellie migrated from Jamaica in 1982 and has lived in Canada for the past 23 years. His investment team includes Dwight Carty, a Toronto businessman of Jamaican descent, and Clayton Walcott, a Jamaican entrepreneur living in the Cayman Islands.

Smellie said he was especially motivated by the opportunity to 'give back' to the island.

"I also (made the investment) because I want to be a part of Jamaica, invest in the country and create employment," he told the Business Observer on Monday from the new outlet, where workers were still installing equipment and making other preparations for Saturday's grand opening. The restaurant is set to open with at least 15 employees.

What's clear is that Dixie Lee intends to wrestle head-on KFC's control of Jamaica's fried chicken
fast-food market. The franchise is aiming to come to the local market at a lower price point than that of KFC, where a two-piece chicken combo meal fetches $460. It aims to also challenge the fast-food 'colonel' on variety -- with a menu offering that includes jerk chicken, seafood, pizzas and a host of side orders, such as wedges and coleslaw -- and, importantly, taste.

"We use a different method of cooking than KFC," said Noele Murano, operations director at Dixie Lee International Industries, parent company of the Dixie Lee brand name.

"To compare them side by side, I will put (Dixie Lee) up against (KFC) any day of the week for the taste and quality," added Murano, who is on the island to help with preparations for the launch, including the training of staff members.

What's more is that the franchise is looking to open three or four more restaurants in Jamaica before the end of 2012.

"We are looking at a long-term relationship here," noted Murano, adding "We are really going to develop the Jamaican market."

But not many international
fast-food companies, much less those focused on fried chicken, can boast successfully penetrating a Jamaican market that has for decades been dominated by KFC and Burger King.

Businessman Roy d'Cambre brought Church's Chicken to local shores in 2002, but closed its door within only three years. McDonald's, which came to Jamaica in 1996, closed its eight restaurants and left the market less than a decade later, having failed to find a suitable franchisee for the operation here. Taco Bell and Kenny Rogers Roasters are others that have suffered similar fates in the fiercely competitive local fast-food market.

Citing weak customer response, the local franchisee of American fast-food company Popeye's Chicken & Seafood a few years ago contemplated pulling out of Jamaica and relocating to Trinidad and Tobago. But the brand remained in the island after the operator reviewed offers for the purchase of the Constant Spring Road property which houses the fast-food restaurant, the only one remaining on the island.

In fact, the difficulties of cracking the Jamaican fast-food market may have influenced Smellie to scope the industry for nearly four years before launching Dixie Lee here three days from now. Smellie incorporated the operation in September 2008 but has since then been just "working the market", he said.

Some of the initiatives have involved sponsorship deals, including that of the popular Camperdown Classic racing meet over the past several years.

"We have been around for a long time, trying to meet the market and work with the people of Jamaica," Smellie revealed.

Murano interjected: "We didn't want to start before we were 110 per cent ready. We are here to make a great first impression and maintain that."

According to Smellie, the company chose to open in Portmore after extensive market research revealed that the city, comprised of some half-a-million persons, is KFC's most successful market in the country.

"It shows that KFC makes the most money in Portmore," Smellie disclosed.

While Dixie Lee's special blended seasoning will be imported from Canada, Smellie said that the establishment has partnered with a number of local suppliers of raw materials, including Caribbean Broilers and Rainforest Seafoods.

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