Investing over $50 million to procure new equipment, Stationery and Office Supplies Limited (SOS) is looking to double output from its SEEK factory by mid-year.

The SEEK factory, which was acquired by SOS in 2018, at the time paved the way for the company’s entry into manufacturing and since then has continued to drive positive out-turns for the business. Ranking as one of the stationery supplier’s best performing areas, revenue contribution from this division moved from approximately $35 million in 2018 to more than $100 million last year.

Of the new equipment expected to come on stream that will further add to the company’s productivity are a ruling machine that will increase its ruling capability fivefold and two book-making units that will staple, fold, cut, and bind exercise books in one pass, ultimately tripling daily output.

“We are on track to significantly ramp up our production, effectively doubling our current capacity. The SEEK factory is presently very labour intensive and the new machinery comes with technology that will bring SEEK to the modern era of manufacturing,” said Allan McDaniel, managing director of SOS.

Pushing to have the new equipment up and running by June, McDaniel said the company was hoping to capitalise on sales during the busy back-to-school period but this may not be realised in light of some identified challenges.

“We are still trying to meet the June target…at the time the decision was made we knew it would require a 4-6 month delivery period which would take us right up to the upcoming summer period. However, after factoring staff training needs and the setup of equipment as well as a number of other hiccups with startup, I don’t think we’ll be able to reap the full benefits from it at that point. I therefore imagine 2025 as being a better time for us to benefit from the addition of these equipment,” McDaniel said in response to queries from the
Jamaica Observer this week.

“By the end of the summer period the machines I think should be fully operational, putting us in a better position to use our down time in the latter parts of the year to ramp up supplies so that we can have more products to sell during the back-to-school period of January. It will also give us the opportunity to resume production for some of the products we had to stop making because we didn’t have the capacity,” he further explained to the Business Observer.

With the equipment to be sourced from India, the company is expecting to not only bring improved production capabilities to its operations, but also to offer more competitive prices for dealers and customers. Its setup and operationalisation will also make way for the recruitment and training of at least 10 new staff members.

“This investment was the obvious choice if we wanted to continue to grow the business. It will allow us to focus on our best-selling products and make sure we always have sufficient quantities of these products in stock at all times. With the purchase, we are also bringing in persons to train our staff on the new machines. This training should take up to a month but it will definitely provide them with the new skills needed,” the managing director noted.

Even as the company looks to go after new opportunities in other parts of the region, its focus on the local market, in which it believes there is lots more room for growth, remains among its top priorities.

The more than $100 million earned from the sale of SEEK products in 2023 which McDaniel regarded as just ‘a drop in the bucket’ in terms of market share, he said will require further growth in current inventory levels if the company is to carve out a significant portion of that now available. With increased storage capabilities in Montego Bay and after recently acquiring and building out additional warehousing space in Kingston, the company along with its on-boarding of the new equipment is hoping to achieve this.

“There is currently so many imports from countries such as Trinidad, China and India that the market is now flooded with international books. Even as we double capacity, there is still a far way to go as we need to push more of our products to other parishes outside of Kingston and with our latest move, the aim is to do just that. In the meantime as we continue to increase our production, the intent is to ensure that people will have adequate supply of our products and not have to rely on imports,” McDaniel said.

“We count on the continued support of our local market and their willingness to purchase a Jamaican-made product and brand that is on par with, if not superior to, imported options,” he added.

SOS, which at the end of 2023 witnessed another record breaking year, secured revenues of $1.9 billion, up from $1.75 billion in 2022, with profit of $277.8 million.

“For our upcoming year and beyond, we anticipate further growth and we definitely expect revenues to surpass the $2-billion mark this year. We had hope to do so last year but fell short of it, so our expectation is to earn above the mark as we continue to witness growth across a number of our product lines. We see no reason to slow down and not to expect 2024 becoming another record year for us,” McDaniel said of the outlook.