Tue | Sep 22, 2020

Canco ventures into co-packing

Published:Wednesday | November 6, 2019 | 12:00 AMKarena Bennett/Business Reporter
Line staff at Canco Limited prepares gungo peas for canning in seasoned and unseasoned coconut milk.
Executive chairman of Canco Limited Norman McDonald (second right) speaks about the operations of his company, makers of Linstead Market products, during a tour of the factory at Seaforth, St Thomas, by members of the Jamaica Manufacturers and Exporters’ Association, JMEA, on Friday, November 1, 2019. The others (from left) are Canco warehouse supervisor Alzaire Scott, JMEA Deputy President David Martin, and Canco Operations Manager Marc Lewis.
Ackees are on display inside Canco Limited’s ripening yard in Seaforth, St Thomas, during a tour of the factory by members of the Jamaica Manufacturing and Exporters’ Association on Friday, November 1, 2019.

Canco Limited, a manufacturing operation based in Seaforth, St Thomas, is looking for at least a 10 per cent jump in revenues from a decision to diversify into co-packing products for both local and international businesses.

A producer of canned ackee, callaloo, and peas in seasoned and unseasoned coconut milk, Canco operates from a 14,000-square-foot factory that sits on a two-acre plot of land in the eastern parish.

Production capacity of the 33-year-old company runs to 50,000 cases per day, but the business only utilises about 60 per cent of its capacity in supplying its biggest market – the United States – and local customers.

But to produce more, it needs more raw materials.

“Although we have over 400 suppliers of ackee, we could do with a lot more suppliers. The US alone could take double of what we are selling, but produce is seasonal and it affects supply,” Executive Chairman of Canco, Norman McDonald told the Financial Gleaner.

Canned ackee production currently accounts for 80 per cent of revenue for Canco, while the remaining 20 per cent comes from its production of callaloo, peas, jellies, jams, and chutneys. At peak production, the company employs about 250 workers. McDonald is focused on boosting bottom-line results through the addition of (at least 30,000 cases to its daily production.

He is already not only marketing Canco’s ability to process canned or bottled products, but its capabilities in food packaging, warehousing, merchandising, distribution and guidance in food-safety certifications.

“We already have all the necessary certifications from the Bureau of Standards, the Hazard Analysis Critical Control Point system and the Safe Quality Food certifications which allow us to go into North America, Poland, and Europe,” he said.

Huge capacity

“There’s a lot of capacity and technology that exists that could be used by other people. Somebody could develop a very good product in their kitchen, but instead of spending millions to build a factory, they could come to us, we help them with developing the product, packaging it and distribution to the markets that we are certified to export to,” he said.

Canco itself previously exported some of its canned products – jellies, jams, and chutneys – to Canada and the United Kingdom, but scaled back due to inconsistency in supply of input produce.

Still, McDonald notes his willingness to participate indirectly by producing for small to medium-sized entrepreneurs who want to growing their business outside of Jamaica.

So far, Canco has secured one co-packing contract, and McDonald is in discussions with two companies on the development and distribution of products.

To fill his 40 per cent gap in capacity utilisation, he is pitching to companies looking to venture into “anything in a can or bottle”.

“But there are other areas outside of that. It could be pre-processing – maybe someone wants to do mango purée; we could do it. If a company wants an intermediary product for their ultimate product, we could do it or even vegetables that go straight to the supermarket,” he said.

Canco’s operation in St Thomas started in 1986 initially on a five-year contract as an exclusive packager of ackees and other vegetables for a company focused on exports. By 1992, the company began manufacturing under its own brand, Country Choice, but in 2006 changed its labels to Linstead Market Jamaica.

Some 90 per cent of the Linstead Market canned products are exported to the United States, with the remainder sold in grocery outlets throughout Jamaica.