Jamaica’s palate has evolved over the years as the introduction of new food and drinks bring the world a lot closer to home. While Jamaica has become a Caribbean paradise that has resulted in significant tourism investment, only a few businesses specialise in supplying select products for the industry’s changing preferences. Today’s Corporate Profile highlights Caribbean Producers (Jamaica) Limited and its co-founders Anthony Mark Hart and Thomas ”Tom” Tyler who have spent nearly three decades building one of Jamaica’s premier specialty foods and spirit distributors.

Caribbean Producers might be known today for the distribution of several types of high-end meats, dairy and spirits, but the business name harks back to the 1950s when Tom’s parents founded a shipping business under the same name in the United States of America. This business would operate two ships between Montego Bay, Jamaica, Miami, Florida and George Town, Cayman Islands.

That business would later evolve in the late 1980s under Tom along with his mother Margaret and sister Stephanie as they focused on serving the Jamaican tourism industry which was undergoing its revival and expansion. This was mainly through the sale of furniture, fixtures and equipment (FFE) to Sandals, Super Clubs and other growing hotels in Jamaica and Eastern Caribbean. Tom would eventually be selling equipment to Mark Hart who was running his own garment business. While both men knew each other for decades, their families knew each other going back as far as two generations.

After the Gulf War in 1991, business changed, habits changed and how people bought things also shifted. Both men thought on what the next big business venture would be especially as they served the north coast of Jamaica. The idea which stuck was on selling consumables that would always be in demand regardless of the season. So, Caribbean Producers (Jamaica) Limited (CPJ) was formed on April 18, 1994, and got underway in November.

“Something that we would give a service for and that they would buy and rebuy over and over again. The first concept for opening CPJ was [that] we wanted to be Sysco food services of Jamaica because in Jamaica, there were large distributors like Grace and Seprod were retail distributors. Nobody really focused on what hotels needed. It was very fragmented. Sysco in the US is the largest broadliner to the hospitality industry on trade and we said we wanted to be Sysco Food Services,” said co-founder Tyler in a recent interview with the Jamaica Observer on CPJ’s beginnings.

Thanks to the relationships built from the older FFE business, CPJ imported its first container of toilet paper under its dry goods segment to its 16,000-square-foot warehouse at the Sagicor Industrial Complex in Montego Bay. While some would have scoffed at the idea, CPJ was able to secure a relationship with paper products manufacturer Kimberly-Clarke which they still retain today. The company was able to achieve US$1.5 million in sales by the end of its first year of operations.

This venture began with five employees including Robert Valentine, Errol Penny Cook and Andrew Reid who still remain with the company today. The company’s current director of institutional sales Hugh Logan has remained with the business after more than 25 years as well.

CPJ later expanded to other consumable products with its next foray being wine in 1997 that was imported from The Les Grands Chais de France Group. This was meant to satisfy the growing demand from hotels whose clients preferred to have different spirits. CPJ also opened its first beverage factory in 1999 to manufacture fruit juice concentrates and frozen drink mixes.

This later expanded to include ready-to-drink beverages like Monster, foods like grains and dairy, beers, beverage systems and chemicals used in the sanitation of a hotel. Hart ran the business as chief executive officer (CEO) from 2004 to 2011 before becoming the executive chairman.

“Despite us having the customers base, infrastructure, the best cold chain in Jamaica, we have not imported one grape, one apple, one pear, one potato,” Hart explained on the reason why the company doesn’t import certain produce.

However, the company faced a hurdle in trying to satisfy the growing demand for spirits which faced heavy taxes at Customs to the tune of 150 per cent. This was at a time when more exquisite spirits remained a hidden item at some hotel bars. As a result, the company believed it was servicing only about 10 per cent of the demand while the remaining market share came in illicitly. CPJ began lobbying in 2005 for improvements to the tax structure on spirits with the subsequent Customs commissioner in 2008 proposing a reduction to the 80 – 100 per cent region.

“The premium spirits business has become a big business for us, and it continues to grow. We suffered long and hard on it, but it was worth every dime and every minute. We have new products that we’re launching now, and we just brought on Sazerac which gives us a whole another array of brands. We were on the forefront of bringing wine into Jamaica when at the same time we got duties down for spirits. Today, the Jamaican public enjoys drinking good wine which didn’t happen when we started,” mentioned Tyler about the shift over the years on spirits.

This came a time when the company opened its first 20,000 sq ft purpose-built facility in 2006 where they ended up running out of space within the first six months. CPJ expanded again in 2007 into a purpose-built refrigerated and cold storage facility. The company’s main warehouse today now occupies over 120,000 sq ft and has over six temperature controls to store more than 4,000 SKUs (storage keeping units) that it imports from more than 35 countries.

This expansion gave CPJ the room to broaden the profile of brands it carried including Red Bull, Bacardi, Brown-Foreman, Rémy Martin, Tito’s Vodka and Teremana Tequila. CPJ’s drinks business got so big that they ended up servicing the equipment and machines used at the hotels. The company also has a meat processing factory, branded seafood products and controls the Cru brand in Kingston. It opened its retail CPJ Market store at Lady Musgrave Road in 2012.

All these moves pushed CPJ to earn US$61.34 million in revenue for their 2010 financial year ending June 30 with profit before tax of US$1.84 million. With this growth behind the business, CPJ made its move to list on the Junior Market in June 2011 where it raised $425.75 million in its initial public offering. This made CPJ the 11th company on that market and made it the largest issuance of shares at the time. Hart gave the CEO role to Tyler just before the IPO as the co-founder/co-chairman led the business up to May 2016.

While CPJ was already exporting to the rest of the Caribbean, the company saw an opportunity to enter St Lucia based on the presence that Sandals International had in the Eastern Caribbean country. The company formed a joint venture called CPJ (St Lucia) Limited with the Du Boulay family where they opened a distribution centre in November 2015. CPJ controlled 51 per cent of the business which raked in US$23.45 million in revenue and US$437,171 in net profit in 2022.

“We saw St Lucia because Sandals [International] had a good footprint down there. They had three hotels down there and they invited us because they liked our service. It’s been a great partnership and we’re excited to see them open Dunn’s River. They basically invited us to be their supplier in St Lucia and do some of the things that we do in Jamaica. Obviously, we used that as a base to do business and branched into a retail department, doing local sales and the beverage business,” Hart explained as the rationale for entering the country.

The company appointed Dr David Lowe as CEO in June 2016 to lead the business which ended up paying its first dividend in January 2018. However, tragedy struck in June 2018 when the new multimillion-dollar IT platform mean to integrate the systems in Miami, Jamaica and St Lucia floundered and caused other issues for the company’s logistics. The company reverted to its legacy systems and brought all hands-on deck to resolve the issue which saw Hart and Tyler stepping in more on the day-to-day operations of the business.

By the time the company found some stability, the COVID-19 pandemic shut down the tourism industry in March 2020. This nightmare event came at a time when more than 60 containers were on their way to Jamaica and the company saw the departure of Dr Lowe as CEO. The company’s sales saw a significant haircut with the staff base reduced due to the fall in sales.

“So, we didn’t go home and play gold. We worked as hard as ever through COVID on restructuring our operations so that when we came out COVID, we would be strong. Obviously, we did our great bucket deal which became a national deal as everybody was doing it. We were selling it for under cost, but it was better than throwing it away and it got us cash,” Tyler explained.

However, the event forced CPJ to re-evaluate its entire business and focus on investing in its systems and operations while running a much nimbler operation. This approach worked to their benefit as they earned US$7.72 million in consolidated net profit for 2022 with its second quarter seeing the business earn more profit in three months than any normal year before COVID-19.

Since then, the company has opened a new retail store at Drax Hall, redesigned and upgraded the CPJ store next to its head office, expand its e-commerce and digital presence while making moves to grow even further. The business moved to the Main Market of the Jamaica Stock Exchange in July 2021 which was the year its stock price was the best performing.

CPJ’s nine months financials up to March 2023 show it earned US$107.04 million in revenue which positions it to have its best year on record. The company is also planning to invest US$7 million ($1.09 billion) in expanding its operations in Jamaica and St Lucia for the ensuing year. While it is still awaiting a resolution with Jamaica Customs to begin its homeporting business for cruise ships, Hart and Tyler look forward to the boom which will come in the subsequent years with more than 5,000 hotel rooms set to be developed.

“Because of the high interest rates, we would love to be able to meet the capital needs of the company primarily through our own resources. The shareholders, of which Tom and I are significant shareholders, we’re willing to forego taking money out of the company with a longer of investing to build the company’s strength and profitability for the shareholders going forward,” Hart closed.