Derrimon aims to expand Sampars Cash and Carry, supermarkets

Business

Derrimon aims to expand Sampars Cash and Carry, supermarkets

…company to establish new Select Grocers supermarket in Mineral Heights, Clarendon

BY DAVID ROSE
Observer business writer

Sunday, February 21, 2021

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Derrimon Trading Limited is looking to accelerate the growth and reach of its key growth engines, Sampars Cash and Carry and Select brands, with the company aiming to establish a new Select Grocers supermarket in Mineral Heights, Clarendon.

This new 41,000 square foot supermarket will be located at Sagicor's Millennium Mall, and form part of the company's strategic focus and growing vision for Derrimon 2.0 which includes expanding the retail reach of the Select Grocers brand.

This was outlined by Chief Financial Officer Ian Kelly at a recent Jamaica Observer Business Forum, where he described the current Select Grocers in Manor Park a resounding success, with many customers travelling far distances to try their prepared Select meals.

“We want to give consumers better value, better experience and be unique in what we do. We are going to be doing Select Grocers in Clarendon and other locations throughout the island.”

Derrimon had earmarked $500 million in its prospectus for the retail expansion in Clarendon, with the remaining $200 million from its recent public offer for the Delect brand and product lines.

The Manor Park Select Grocers has generated a 10 per cent increase in revenue to $620 million in its 2019 financial year, and a 36 per cent increase in net profit at $32.8 million.

Although the current Select is operated as a joint venture with Derrimon controlling 60 per cent of the ownership, Kelly described the future ownership structure of the Select Grocers brand as inconsequential to the company's strategic plans.

SAMPARS ONLINE BUSINESS EXPERIENCES TRIPLE-DIGIT GROWTH

Although schools, canteens, and catering businesses have all but shuttered or remained closed during the novel coronavirus pandemic, the disruption didn't stop the Sampars brand which experienced triple-digit growth in its online business and double-digit growth on a whole during the period since March.

The major catalyst for this shift towards the Sampars brand came as a result of the St Catherine lockdown in April which forced people to look for ways to source food.

“The lockdown of St Catherine catapulted our online business into people's minds. People who were marooned in the parish and found the service as an active solution to get the groceries into their hands. We also found that persons in the Diaspora were shopping for their relatives in Jamaica,” general manager of Sampars Craig Robinson said on the acceleration of online usage.

Robinson pointed out that the company's website saw overwhelming demand, with Sampars having to make an immediate shift towards a schedule system, to keep up with the orders and hire additional staff to help fulfil the needs of consumers.

The company has expanded the capacity of its systems to manage future orders and will be deploying its modern enterprise resource planning software in the second quarter.

With the growth in unemployment and decline in income, Sampars standard barrel purchase system has been expanded further to allow for more people locally and in the Diaspora to purchase the necessary goods for their relatives at home.

Chief executive officer of Derrimon, Derrick Cotterel, pointed towards the company utilising the insight gleaned from its newest acquisitions in New York for growing its applicable technological deployment in Jamaica.

He further highlighted Derrimon's ability to expand the reach of the Delect brand through these new supermarkets using the $4.22 billion gained from the additional public offering.

Derrimon will be looking to expand the Sampars brand further across the country from its current seven locations, which are mixed between cash and carry and the supermarkets, to more places in the west of the island.

The Old Harbour location is the current flagship supermarket, while the Marcus Garvey Drive location is the flagship cash and carry.

Cotterell pointed to expanding the current offerings while maintaining fewer stock keeping units (SKUs) in order to ensure there is a focus on the niche products of Sampars. While the Boulevard location offers a low cost on meats, the enthusiastic CEO made note that Sampars caters for everybody with a specific emphasis on saving money.


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