Caribbean Producers Jamaica (CPJ) has added a new line of chemical cleaning products and other detergents to its portfolio of products under a US$1-million deal with American company Swisher Hygiene that taps into the local hospitality market.
The US$1 million (J$90 million) represents an investment by both companies in the installation of chemical dispensing equipment and infrastructure at CPJ’s base in Montego Freeport.
“It will give us a deeper relevance to our customers as we are focused on providing service to the hospitality industry and this is just another aspect of our commitment,” said Mark Hart, executive chairman of CPJ.
Hart described the deal as a joint venture between CPJ and Swisher but did not disclose how the investment would be split between the two companies nor the profit-sharing arrangement.
He said he expects the business to generate between US$2 million and US$3 million in revenue within two years of start-up.
CPJ is better known as a distributor of wines, beverages, seafood and select grocery items.
Hart said the joint-venture contract with Swisher was signed in June and that CPJ was already supplying the products.
“I will not name the customer but we have already received a contract with one major hotel chain and additional negotiations are underway,” he told the Financial Gleaner.
Hart said 20 percent of CPJ’s 10, 000-square foot multi-purpose building/warehouse in Montego Freeport, which is now being constructed at a cost of some US$800,000, will be devoted to the chemical operation; and that CPJ would dispense 50 of Swisher’s sanitation and hygiene products.
He said more funds would be poured into dispensing equipment and infrastructure as the company closes contracts with more hotels and companies.
CPJ’s last big capital project was a new branch of its retail arm, CPJ Market, under development at Lady Musgrave Road in Kingston and due to open in October.
A distribution centre is to be opened in St Lucia; while earlier in February, CPJ expanded its meat-processing plant geared towards providing the hospitality market with pork chops, bacon, hamburger patties and other meats, with plans to also supply the retail market with a similar selection of meats.
Hart said the partnership with Swisher, which took a year to finalise, would augment the company’s chemical service offerings which it began in January 2010.
Swisher Hygiene was founded in 1986. The Charlotte, North Carolina company is managed by entrepreneurs Harry Wayne Huizenga and Steve Berrard.
CPJ has just wrapped up its first year as a publicly traded company. The company was established 18 years ago in 1994 as an integrated food service distributor serving the hospitality market.
Its retail services division was established in 2003 to supply the market with international beverages, wines, and spirits.
CPJ last reported revenue of US$49.8 million for its nine-month period, marginally improving on the US$48.6 million it posted for the corresponding period last year, and net profit of US$2.56 million which more than doubled the US$1.18 million made in the 2011 period, due partially to the 10 years of tax waivers granted to newly listed junior market companies.
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Jamaica Gleaner
Sabrina Gordon, Business Reporter
sabrina.gordon@gleanerjm.com
