By Leonardo Blair, Staff Reporter
Baskin-Robbins Portmore branch, now property of VMBS. - File
CYBER-FOOD Products Limited, operators of the local Baskin-Robbins franchise, has sold its first Jamaican branch building in Portmore, St. Catherine to the Victoria Mutual Building Society for $30 million (US$630,000).
Executive chairman of Cyber-Food Products Limited, Richard Burgher, said the move was a part of a reorganising exercise currently being carried by the company islandwide to increase efficiency. There are now seven Baskin-Robbins stores in Jamaica and all are leased.
"It's just a part of our general reorganisation," Mr. Burgher said. "We are getting out of real estate and we are getting out of retailing."
The Portmore branch was a central receiving and distribution point for all 10,000 gallons of ice-cream that the company stores, Mr. Burgher said. Instead of using such an expensive property to store things they decided to sell and move to a less expensive property.
Even though they have sold the property, he said the chain plans to reopen a smaller store on the Portmore Mall by July if everything goes according to plan.
"You don't need prime real estate to store things," he said. "It didn't make financial sense."
Established at a cost of US$1.25 million, in December of 1996, the store targeted the huge new market in St. Catherine's dormitory community. The sale price and establishment cost are not directly comparable as establishing the business includes costs other than just the bare building and land.
With more than 4,500 retail stores, Baskin-Robbins is the world's largest chain of ice cream speciality stores. Operated by Randolph, Massachusetts-based Allied Domecq Quick Service Restaurants, it is part of U.K.-based Allied Domecq PLC, one of the world's largest spirits and quick service restaurant companies.
"We are master franchisees," Mr. Burgher said. Rather than operating the branches themselves, Cyber-Food is offering Baskin-Robbins sub-franchises and becoming a wholesaler of ice cream.
The Liguanea Branch in Kingston has now become the model on which other branches will be developed. It is being used to train managers and staff of the other branches.
The branches are also being slimmed down, he said. From an average of 900 square feet, branches will now be developed at about half that size.
"We are quite pleased with the results," he said. The plan is to open one new branch this year, two branches next year and two more the following year.
