Looking to the future
THERAPEDIC Caribbean, the Portmore, St Catherine-based producer of mattresses and bedding accessories, landed its latest bedding contract — outfitting the Montego Bay, St James-based Deja Resorts with mattresses for all its rooms — and is now turning its sights on boosting exports as part of long-term growth. The company, however, declined to state the size of the contract.
Aswad Morgan, director of marketing and sales at Morgans Group of Companies — parent company for Therapedic Caribbean — said the deal was the latest in a string of resorts the company has been outfitting with mattresses in the last 24 years.
“We have been quietly increasing our supplies to a number of the smaller hotels in areas in Negril and Montego Bay, and recently we just did a nice project with Deja Resorts where they needed all the rooms there — about 90 rooms — outfitted with new mattresses,” Morgan told the Jamaica Observer.
“We supplied them with real high-end products, memory foam products that they put in there, and I am sure they are going to benefit significantly now in terms of the feedback they get from their guests,” he continued.
“I actually commend them because they were very, very committed to buying local, and it’s more of these examples that we want that will end up helping to build Jamaica…especially when you are committing to not just buying locally, but buying a product that is produced to international standards. They wanted to differentiate their product, and one key way to do so is to have the kind of bed that guests will interact with.”
Robin Russell, general manager at Deja Resorts, was equally pleased with the choice.
“We are a Jamaican brand and Jamaican-owned, and as such we believe that the tourism dollar should be distributed, if possible, to Jamaican companies. We have engaged with them for quite a while — in other words, we have asked them to come down on numerous occasions to assess the quality of our beds — and when it was time for us to upgrade or replace our old beds they were the first ones we called,” Russell told the Business Observer.
“They were able to offer us a very good product, and helped us to upgrade the bedding that we bought the hotel with to a better bed, a better mattress. They were able to supply us so quickly; we couldn’t take the orders as quickly as they could supply us so it just goes to show their efficiency. They had to hold our products, and stored it for us for an extra couple of weeks until we got rid of the old mattresses. It was done on a timely basis, which was a great incentive for us to go this route. We know that they are here, so if we have any problem with any of the mattresses we can call them and they can come and look at it. It was a very pleasant experience working with them and we know that in the future they will be the ones we will be calling for any bedding needs,” he continued.
So far, Therapedic Caribbean and the broader Morgans Group of Companies have found success in tackling the bedding needs of a number of resorts, but Morgan said this was not always the case.
The Morgans Group, which started in 1974 as a company called Morgans Industries, did not start in bedding but began as an entity which made mahogany furniture.
“My father Kenneth Morgan is a structural engineer and my mother is a registered nurse. They were both doing their own thing and decided to go into business on their own. My grandfather was a small-scale manufacturer who produced mattresses at the back of his house, and lost it in ’58 to a fire. My father had an appreciation for structures and, given his father’s own business at the time, he decided he wanted to start a furniture factory. My mother was a registered nurse, had me in ’73, and started the business in ’74,” Morgan reflected.
“That business gave us a really good start building solid mahogany furniture such as bedroom sets, living room sets, dining, and so on. That facility was a 16000-square-foot facility at Nanse Pen, off Spanish Town Road, [St Andrew,] on Weymouth Drive. We eventually got into exports. We were the largest supplier to Courts across the region, and we exported all the way up to the eastern side of the US and the French islands.
“We decided in ’82 to get started in foam, and we started Polyflex Foam in 1982. Polyflex is the largest manufacturer of polyurethane foam in the region, and produces foam for the Morgans Group and other companies.” The company produces a range of sleep products, mattresses, bases, memory foam, pillows and so on.
“We moved from foam, and with the footprint with furniture and foam, Therapedic International, who are amongst the top five bedding manufacturers in the region, approached the company to produce bedding under licence with their name in 1984. Right now our main customers are the furniture retailers like the Courts and the Singer. We also supply heavily to Government institutions like the JCF, the Correctional Services for the barracks, and any institution that uses bedding for any reasons.”
During those early days Morgan said he was always close to the business.
“I have two younger siblings, and we all grew up in the plant. We come home every evening and we sit in that plant, do our homework under the desk. It was a deliberate strategy by our parents to get us to know the business and everybody for a few hours each evening.”
Having grown up in the plant, Morgan was to leave for school in the United States. When he returned he joined the company in the mid-90s, deciding to take the entity’s products to the hotel sector.
“Before then, we did a few hotel jobs but nothing that we could really say, ‘I did this and I did that.’ “
However the big jump off into the hotel sector came when the “Spanish invasion” began, the reference given to a number of Spanish hotels which entered the Jamaican market in the late 1990s into the early 2000s.
“When we decided to go into the bedding industry the real big opportunity came when RIU entered the market. They were the first Spanish hotel to start the invasion. When RIU came in 1999 the Ministry of Tourism and Jampro set up some linkages to make sure that Jamaican suppliers could display their goods, and the guy from RIU walked through and he chose us and we made a few visits down to RIU in Negril.
“It was very profound for me that on the visits to Negril, that long, four-hour drive, I would say to my old woman, ‘Yes, the margins are very thin, and we are not going to make any money, but we are going to use this as an opportunity to get our foot through the door. We are going to get the contract, we are going to perform well and let it work for us — and that’s exactly how it played out.”
He said the company really didn’t make any money from the first big hotel contract, but he said with the property having 396 rooms to produce bedding for, the company set about the task in earnest.
“From the signing of the contract to final delivery it was six weeks, and during that time we also imported our raw materials. They were so impressed and shocked! A lot of these businesses think Jamaican businesses will have excuses to not deliver. We recognised that if we failed, we would have not only failed ourselves but would have also failed the industry and the nation. But we did perform well — the product stood up. And thereafter, all the opportunities started to come in, recoginising that RIU was on to something. And now, the list is countless with all the major contracts that we have done for hotels.”
He name-dropped other hotels such as Secrets, all the Jewel properties, Hilton Rose Hall, Jamaica Inn, Melia Hotel, Goldeneye, Couples, and some of the Sandals properties.
“Bahia Principe was a massive one for us because they are one of the largest, with 1,200 rooms, and again we knocked it out in six-seven weeks. And our factory was not producing exclusively for them,” he ensured to point out, “we were producing at the same time for our other customers.”
He said with the Tourism Linkages Council aiming to get more Jamaican products into hotels operating locally, things have gotten easier, but admits there is still some way to go in maximising the returns to Jamaica from the tourism sector.
The company doesn’t make furniture anymore but it now has a distribution arm, Brand Hill Distribution, which started in 2017 but was impacted by COVID-19 and is to be revived. Morgan said it distributed silverware, glassware and dinnerware then, but when it is up and running again the company will add new products to the list.
Expansion and exports
For now though, he has trained his sights on boosting the company’s earnings through the export market, but said to do so there is a need to first expand the factory space and storage.
“On our foam side of the business we need to significantly expand the plant itself, because there is a number of new foam products that we want to produce, but the foam business is a space business. You can run the machine to produce foam as long as you have the space to store the output but when you are running different types of foam you will need more space to store — and we are running out of space at the plant.”
He said, ideally, he wants to acquire land to build new plants so as to consolidate all manufacturing and storage at one location, but the cost of land in St Catherine, where the company can take advantage of the road network, is prohibitive.
“I think that Government must focus on assisting the sector more and encourage, for instance, things like lease-to-own. Why should we be shelling out hundreds of millions of dollars to buy land alone and I don’t start building a plant and putting in machinery as yet? Lease it out to us and allow us to go out and flourish, and pay our taxes, and grow the business, and take the time to buy it off over a certain period. That should be encouraged.”
“We are export-ready at the foam plant (based on the quality of the product) but we can’t go into that now until we can expand the plant further. The growth is going to be like this the minute we expand,” he said as he gesticulated to show an upward trajectory, adding that the intention is to replicate the successes he has had so far in the hospitality sectors of Jamaica and elsewhere in the Caribbean.
“We can easily do this, it is just a matter of loading containers now and shipping — though it will be a bit more challenging — but we can certainly do it.”
“What we certainly want to do is to continue to be the dominant player and continue to be ahead in terms of what is available internationally, staying on the cusp of technology and all of that. I can see us moving into a little more automation, just from a standpoint of efficiency.”