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Arc of success for Norman Horne over a 22-year career

BY RICHARD BROWNE
Business editor
browner@jamaicaobserver.com

Sunday, April 28, 2019

Norman Horne has big plans for the continuing success of Arc Manufacturing, a business which over the last 22 years has grown to become one of the largest companies in the local building supplies sector, in both distribution and manufacturing.

Horne left a succesful financial career in the United States in the 1990s to return to Jamaica to start up a new business, one which he hoped would help contribute to the national economy, while creating employment for his siblings and family members.

“Arc started out for two compelling reasons,” the Arc manufacturing CEO told the Jamaica Observer in a recent interview.

The first was when Horne attended a forum in New York City where the then prime minister and his minister of industry and commerce promoted Jamaica as a great place for the diaspora to invest.

But the second reason was even closer to home, as Horne had a number of siblings back home in rural St Elizabeth, who were having “a hard time finding jobs”. That meant sending over remittances, but Horne said, “I wanted to find a business to employ them.”

In retrospect, Horne says he probably would have done financially better if he had remained in the US, but he does not regret his decision.

“I enjoy manufacturing — making something — and seeing the value added to national GDP,” Horne told Sunday Finance.

The idea for a business came when Horne flew over Jamaica on an Air Jamaica Express plane from Montego Bay to Kingston and saw the vast amounts of rusty zinc sheeting on houses that needed to be replaced.

“I decided that was the product,” Horne said, as he saw the opportunity to move into meeting that market need.

But first he turned to Jampro — the government agency that promotes business opportunities in export and investment to the local and international private sector. Jampro, Horne noted, studied his proposal and advised him that his best decision would be to invest in the local repo market instead.

Fortunately, Horne didn't take that advice, and launched into the business of providing and manufacturing zinc sheeting for the market. The company started in 1996 with five members of staff, and bought pickup trucks to sell zinc directly to the consumers, differentiating itself from its competitors.

Competiton was stiff, but not everyone could measure up to Arc's strategy of low prices. Horne noted that at least one competitor “was out of business after making a threat of burying us”.

Despite its start in zinc roofing, Arc may be best known for being a cement distributor, at times seeming to challenge the monopoly of the Caribbean Cement Company – though now the two companies have a partnership. The company is also a major distributor of steel.

But in fact the company is involved in far more than these three products, as the company manufactures some 17 different items from nails to roofing tiles, even cables and treated lumber. And in some product lines they have as much as 100 per cent of the market, Horne said.

Horne recently took a team from the Jamaica Observer on a tour of his company's expansive Kingston headquarters which holds seven manufacturing plants for products such as chain link fencing, nails, roofing, wire, fabric mesh, track and studs and lumber treatment along with warehousing and distribution hubs. And the company continues to expand, as a new factory is currently under construction.

And the company is no longer focused only on the local market, as its customers — like many of its suppliers — come from around the globe. The company buys steel from Turkey and sells to customers elsewhere, buys untreated lumber from places like Brazil, Honduras and the US, and because of lower expenses is able to export right back to the market it originated in.

In fact, Arc, which may not be a name brand in Jamaica outside of its market, is in effect an international company. Horne disclosed that foreign sales are made in countries as far as South Africa, Turkey and as near as Haiti and Cayman. But rather than product specific, the emphasis is on profits.

The company employs some 300 people, and its car park is filled with top-end SUVs and cars, suggesting that its employees – like the company – are doing rather well.

Today, Horne says “we are in the top three” manufacturing companies in Jamaica. But still the company is setting its sights on greater growth and the company is currently in expansion mode, building more factory space.

“We intend to become number one in Jamaica and certianly the Caribbean,” Horne stated. “We have a great team.”

Currently the company has three branches, with its head office on 18 acres of land at Bell Road in Kingston, and warehouse space in Ferry Pen off the Mandela Highway, as well as a location in Ironshore in Montego Bay. Manufacturing at Arc goes on 24 hours per day, with night shifts working well past midnight, many of the employees coming from areas around the head office.

The company also keeps an eye on being energy-efficient, and energy costs are kept down via solar panels.

But despite the current popularity of Jamaican companies going public by listing on the Jamaica Stock Exchange via an Initial Public Offering (IPO) Horne has no intention of taking the company public, however, as that could constrain its development.

Horne notes that 100 per cent of Arc's financing is taking place on the domestic market — adding, “This is where Jamaica needs to be if we are to grow our economy.”

In the mean time, Horne intendsto keep on working at the helm of the company, but not indefinately. “I will retire at 65 or before, because it would be unfair to my family to stay longer,” he said.