GK eyes larger slice of resort food market

Published: Wednesday | July 3, 2013 Comments 0
The 8,800-square-foot Hounslow food-processing and packaging facility, run by GK Foods in St Elizabeth.
The 8,800-square-foot Hounslow food-processing and packaging facility, run by GK Foods in St Elizabeth.

GraceKennedy Limited (GK) which has been targeting the resort market for at least three years says it is in a position to double sales by 2018.

Jamaican resorts buy J$16 billion worth of fruits and vegetables alone from local and overseas suppliers per year, according to data from the Ministry of Agriculture released in 2010. There have been no updates of those figures.

The agriculture ministry said in mid-2010 that its policies were aimed at securing 50 per cent of the business for locals by this year.

Now, the tourism ministry, through its Tourism Linkages Council which met for the first time last week, is taking up the challenge, but so far has not set a target for the business it hopes to drive through interconnections between the tourism, agricultural, manufacturing and entertainment sectors.

But GraceKennedy has - even while Wehby declined comment on the dollar value of its slice of the hotel market.

"Our plan is to double the size of our business over the next five years by focusing on fresh produce from our Hounslow plant and expanding our range of wines, meats and processed food products," said Group CEO Don Wehby on Monday.

NEW PACKAGING

"We also intend to introduce new packaging sizes specifically designed for the hotel sector. We have a division in Grace Foods specifically designed to target and grow this sector," he said.

In 2010, GraceKennedy began operating the Hounslow Packaging House, developed at a cost of J$49 million under the Improving Jamaica's Agricultural Productivity Project.

Under the agreement struck with the agriculture ministry, GK has equipped the facility and has committed to buy raw materials from local farmers. Hounslow operates under a 15-year lease, for which GK pays J$2.1 million per year. But Hounslow is just one of GK's facilities.

"GK supplies the hotel market with a wide range of processed food products, condiments, spices and beverages - wines and juices - some of which are manufactured at our facilities right here in Jamaica," said Wehby.

"These include Grace soups from our NALPRO plant, Grace hams from our meat plant and Tropical Rhythms from our canning plant."

The company also sells ketchup and hot pepper sauce to hotels. Where it is lagging is in the fresh food market.

"While we do not supply fresh produce directly to the hotel market on a consistent basis, we supply fresh produce to a number of restaurants outside of KSA [Kingston and St Andrew] and our meat factory also supplies franks, ham, bacon, and other meat products directly to the hotel sector," said Wehby.

Led by chairman Donovan Perkins, the Tourism Linkages Council has been tasked with the promotion of a 'Buy Jamaican' campaign among the hotel sector; working with the financial sector, including the Development Bank of Jamaica and EXIM Bank, on working capital support for producers; and to explore the feasibility of establishing contract pricing in US dollars.

There was no update from the Ministry of Agriculture up to press time on its push to shift demand from imports to local produce in the resort sector.

business@gleanerjm.com

 

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