New Technology Platform for CPJ – Expansion Plans Boost Logistics Investment | Business
A one-day lockdown of Caribbean Producers Jamaica (CPJ) facilities in late October was intended for a systems upgrade.
The Montego Bay-based distribution and manufacturing company is adding a new technology platform to improve its supply chain and logistics management functions.
CEO David Lowe said the current upgrade is the first part of three phases. CPJ is spending a total of US $ 1.5 million on the project, which Lowe said was necessitated by the company continuing to grow, both in its home market of Jamaica, as well as in abroad.
âTherefore, our investment in technology is not only strategic, but necessary to remain efficient and manage costs as we continue to grow,â he said. “The deployment of new technologies will improve a number of functional areas of our business model.”
The logistics platform is a 24-month project that is expected to be completed next year. The broader expansion program also started last year and will end in 2019. Overall, Caribbean Producers spends US $ 2.7 million per year on projects, over a three-year period, according to Lowe. .
CPJ supplies tourism operators in Jamaica and the Eastern Caribbean with more than 3,000 items, including products made in the company’s food and beverage factories.
Lowe said the company’s business model relies heavily on logistics management.
âOur logistics platform operates in multiple geographic locations outside of Jamaica,â he said. “We are a logistics company first, followed by distribution and manufacturing in that order.” The technology is intended to maximize the company’s ability to “buy at scale and deliver,” the CEO noted.
With the systems upgrade, Caribbean Producers expects to see “a significant improvement in synergies and management insights that will improve our ability to respond to market conditions as well as sourcing and supply chain decisions. “, added Lowe.
At the same time, he noted, the company is undergoing restructuring and expansion. It focuses on recruiting and developing talent to drive growth initiatives and drive innovation.
âThe goal is to allow the company to continue to evolve with best practice capabilities. Our people, products and processes are within reach. This has helped improve financial results over the past year, âsaid Lowe.
Caribbean Producers plans to expand its manufacturing capacity for CPJ branded products. Some of these products include CPJ bacon, sausages, burgers, and fresh pork.
In addition, starting next year, Caribbean Producers will add 60,000 square feet to its distribution center in Montego Bay, increasing that operating space by more than a third from its current 160,000 square feet.
As the company grows, it “explores regional opportunities” to develop its markets, Lowe said.
Caribbean Producers currently has no manufacturing operations outside of Jamaica, but plans to expand production overseas. However, Lowe said the deal that could get there is only at the due diligence stage.
The company’s products are distributed to Barbados, Antigua, Grenada, Saint Martin and the Small Islands, facilitated by a distribution center in Saint Lucia.
Overall, he said, capital spending plans will focus on efficiency and cost reduction, improved management information systems, greater production and manufacturing capacity and supply chain improvements.
For the year ended June 2017, Caribbean Producers reported net income of US $ 2.59 million on sales of US $ 98 million. Performance improved from 2016, when the company made a profit of $ 1.05 million on sales of $ 94 million. Profit increased 147 percent year on year.
Lowe said the restructuring of the company’s debt over the past fiscal year has allowed the company to increase its free cash flow, putting CPJ in a better position to take on new debt for new projects.