Jamaican Teas Limited is entering the coffee market with its own branded instant and ground products, but says it will be outsourcing the production of the line to an undisclosed local operation.
The company, whose core business is tea manufacturing, said Wednesday that it would also be adding spring and flavoured waters and packaged soup to its food product range.
The new offerings, including the coffee products, will be sold under Jamaican Teas' proprietary Caribbean Dream brand, said chief executive officer John Mahfood.
The company is investing J$25 million in its factory operations in Kingston, and another J$25 million on its supermarket businesses, he told the Financial Gleaner, following Jamaican Tea's first annual general meeting as a publicly traded company in Kingston on Wednesday.
Mahfood was reluctant to disclose specific timelines for market entry, and the full investment to be made in the products, but said plans for their continuous roll-out are in progress and that an iced-tea drink could be the first on the shelves, having already been tested on the market earlier.
The company is yet to determine the source of the raw material for its instant coffee, although Mahfood says there is sufficient local supply for the ground version. He is not averse, he told the Financial Gleaner, to tapping coffee supplies from overseas.
"We are looking to get all our material for our ground coffee here in Jamaica, but while doing the same for the instant coffee would be our greatest wish, if pricing is not competitive here, we will be looking elsewhere for the best price," Mahfood said Wednesday.
The product will be going up against longstanding labels Salada, Country Traders, Jablum, Grace, Nestle and others.
Jamaican Teas, which was renamed from Tetley Teas Jamaica when it went public last year, operates out of its business complex on Norman Road in Kingston which houses its warehouse, administrative offices and factory space, which has been doubled from 9,000 to 18,000 square feet.
Mahfood said he have no plans to manufacture coffee at the moment, but will subcontract the job.
"It's the smart thing to do," he said. "You have to be smart when you are introducing new products, and we certainly would not invest in manufacturing equipment until we have an idea what the consuming public's reaction is."
The company is the manufacturer of a range of Tetley products under exclusive contract. It also makes teas and food products under its proprietary Caribbean Dreams label - selling approximately 40 per cent of its product in the English-speaking Caribbean and United States markets.
The company made a net profit of J$58 million in 2010 from sales of J$451 million.
In addition to its own brands, Jamaican Teas manufactures goods under contract for local companies such as Lasco, GraceKennedy and Kendel, and others on the international market. The contracts account for about 10 per cent of its revenue.
Tetley Tea was acquired in 1995 by John Mahfood and his father Adeeb from the Trinidad-based conglomerate Neal and Massy. It listed on the JSE junior stock exchange last June.
The company, which is now 76.5 per cent owned by John and Adeeb Mahfoods, is reportedly the largest producer of tea in the English-speaking Caribbean with 100 million teabags sold annually.
(Source: http://jamaica-gleaner.com/gleaner/20110304/business/business2.html)
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