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Regional corporation pushes into Jamaican market

Published:Wednesday | February 17, 2010 | 12:00 AM

Trinidad-based conglomerate Ansa McAl, which lists its assets at more than US$1 billion

or J$89.75 billion, is seeking to broaden its presence as part of its latest profit push, enlisting

local building mate-rial suppliers, Quality Dealers Group, as its sole agent here for the distribution of construction products.

"This partnership gives us a more focused strategy on building a sustainable stake in Jamaica by deepening business relationships and establishing distributorship arrangements, as is presently being done with consumer goods such as matches and bleach," said Ansa McAl's Steve Gill, sector marketing manager for export.

The 130-year-old conglomerate, which boasts a presence in more than 50 countries and spans eight industries, already has similar arrangements in Jamaica with T. Geddes Grant, Wynlee Distributors and Industrial Chemical Co. for other products.

Market Turnover

Turnover in the Jamaican market for Ansa McAl's products, Gill said, amounts to some US$200 million (J$17.95 billion) annually.

But the company official has stopped short of saying how much the new deal will add to the regional conglomerate's business. Anthony Walker, proprietor of Quality Dealers, also declined to give numbers

in terms of

how much business the partnership represents for his construction supply operation, which turns over a little under J$1 billion in sales each year.

The products to be distributed by Quality Dealers, include clay tiles, PVC windows and doors, Sissons paints and other solutions. These, Walker said, are expected to perform well in the local market.

While heralding the new arrangement, Walker noted that negotiations are also taking place to create long-term financing arrangements to assist developers to purchase the products.

Quality Dealers Group has established itself in the Jamaican market with seven branches in Montego Bay, Port Antonio, Ocho Rios, Mandeville, Morant Bay, Santa Cruz and May Pen, as well as its headquarters located in Kingston.

The group of companies consist of QD Roofing, QD Hardware, Quality Dealers Wholesale and Tony Walker Construction Realty. The property development outfit has completed St Andrew projects such as Palomino Homes at Waterworks, Leitham townhouses in Shortwood and, more recently, Casitas Homes in Vineyard Town.

Quality Dealers also operates a 28,000 square feet manufacturing plant, where its roofing products and tiles are made.

Both the Ansa McAl and Quality Dealer executives are hailing the

new venture as the beginning of a fruitful relationship between their companies. They point out that it paves the way for other areas of opportunities, such as bidding for contracts to supply building materials to large development projects.

The products covered by the deal are already on the local market, having arrived in December.

Two companies are expected to share the marketing cost associated with promoting the products in Jamaica. They estimate that about five per cent of sales will be devoted to this area of the venture.

Global downturn

With Quality Dealers, operating in a shrunken market amid the global downturn, looking to continue its growth trajectory, its principal said the company is to expand its manufacturing operation over the next five to six months with the purchase of new equipment such as a roofing press.

Walker said that approximately US$1 million will be pumped into the expansion, which will allow the plant to run an additional shift and maximise capacity.

Financing is expected to be sourced from the company's bankers, but Walker said institution talks are under way with Ansa McAl to be involved in the expansion drive. He declined to say precisely what form the Trinidadian conglomerate's participation would take.

The expanded plant and the Ansa McAl dealership are expected to boost Quality Dealers' export activity, now done on a small scale.