PriceSmart expands parking upwards - Still seeking location for second store
To keep up with its expanding clientele at its single Jamaican store, PriceSmart Inc is redeveloping the open parking at the Red Hills Road complex into a two-floor parking garage, even as it continues the search for a location to build a second store.
Outgoing Chief Financial Officer John Heffner told the Financial Gleaner that a stable exchange rate and more disposable income have led to higher sales at the supermarket warehouse.
"We have seen good growth in the economy in Jamaica, so the wholesale and distribution market is doing well. There also has been some appreciation of the currency, which strengthens spending power," said Heffner, who became CFO of the American company at the same time that PriceSmart first entered Jamaica, 15 years ago.
The parking lot expansion currently under way at the Kingston store overlays the current parking spaces. Heffner was unable to provide granular details on the project, which involves several steel structures and laying of concrete as pavement on the upper floor.
"It is a substantial invest-ment," said Heffner.
The construction has proven disruptive to shoppers, who have been using social media to voice their displeasure, but the CFO said the reactions were not unexpected.
"We are aware of some complaints. We had this plan to expand for a while, but delayed it to avoid peak periods such as Christmas," he said. "In the long run, it will benefit our members."
PriceSmart is currently expanding existing stores in Jamaica, Guatemala, Panama, and Costa Rica.
"From time to time, we expand the sales floor or parking lots at our venues whenever we realise that our warehouses can benefit from increased capacity," said Heffner.
The sales in Jamaica are not disaggregated in PriceSmart's reports, but it is one of 13 territories that earn a combined US$3 billion from a network of 40 warehouse clubs for the American company. Construction is under way on what will be a fourth location in the Dominican Republic, scheduled to open in 2018.
PriceSmart, however, is still searching for a site for its second Jamaican store.
"We haven't announced any acquisition of land as yet, but Jamaica is a very good market and we see expansion at some point," said Heffner.
PriceSmart, in its last annual report, explained that markets such as Jamaica offer less retail and wholesale competition.
"In larger, more developed countries, such as Costa Rica, Panama and Colombia, customers have many alterna-tives available to them to satisfy their shopping needs, and therefore, our market share is less than in other smaller countries, such as Jamaica and Nicaragua, where consumers have a limited number of shopping options," the report stated.
PriceSmart opened its single location in Jamaica in 2003.