Market decline

Falling Chicken Sales – Jamaica Broilers Consider Further Reductions To Offset Market Decline | Business

Leading poultry producer Jamaica Broilers Group Limited, JBG, has said it may be forced to take further cost-cutting measures in the “not-so-distant future” as it grapples with a 40% drop chicken sales since the hotel closed. sector and the more recent fallout from orders from fast food operators.

In early April, Jamaica Broilers made the decision to slow down the number of poultry processed in order to better manage inventory, streamline production of its Best Dressed product and feed line, and apply a 5% pay cut to all of its staff.

The company even suspended all spending, including discretionary advertising campaigns, and got the 100,000 farmers attached to its poultry business to agree to a five percent rate cut in a bid to stem losses by disrupting the market. less possible the life of its staff and stakeholders.

But with the closure of St. Catherine’s Parish for two weeks, as well as the tightening of island-wide curfews, Jamaica Broilers Senior Vice President of Operations and Finance Ian Parsard has declared to Financial Gleaner that tougher decisions to cut costs seem inevitable for the company.

“Based on what we see, we do not believe that the measures we have implemented are sufficient and we will have to consider other measures,” he said.

Last week, three of Jamaica’s largest quick-service restaurant operators announced a mix of layoffs, temporary chain closures and pay cuts for its employees amid mounting financial pressure from cut backs. hours in store due to curfew constraints. and the closure of some stores due to geographic lockdowns.

In some cases, restaurateurs have called for more than a 50% reduction in sales, which ultimately impacted Jamaica Broilers’ chicken sales. The company also affected 25 percent of its chicks and feeding operations.

“We think it’s probably bottom now. We’ve had a pretty significant reduction in sales levels both on chicken, as well as on chick and feed, ”Parsard said of these latest operations.

The poultry company, which achieved annual sales of $ 55 billion last year, hopes that the recent announcement by the Ministry of Industry, Trade, Agriculture and Fisheries on the temporary suspension of imports agricultural products will be used to protect the markets for local products, especially chicken.

The political action follows calls from government senator and group CEO of food and financial services conglomerate GraceKennedy Limited, Don Wehby, and group chairman and CEO of Jamaica Broilers Group, Christopher Levy.

Parsard is optimistic that things will improve for JBG’s partner farmers and that it will also have a positive impact on its business through the supply of chicks, as well as the sale of Best Dressed Chicken products.

But it won’t be right away.

“Although the move has been announced, some permits would be valid until a certain period, but certainly, by June and beyond, the industry should start to take full advantage of the import cut,” he said. he declared.

Jamaica Broilers has looked for opportunities to increase its market share through acquisitions and expansion, but this remains open for the poultry producer until normalcy returns to business. In the meantime, the company continues to invest in its chicken processing plant with the aim of creating greater efficiency during the ongoing pandemic.

“But, of course, we’re going to have to be careful. It’s not business as usual, so we will have to really be wise in what we go forward and what remains unanswered, ”said Parsard.

As for the company’s operations in Haiti, where political unrest has derailed the company, there is also optimism that these concerns may now be behind the company. Jamaica Broilers was forced to scale back its operations in Haiti, which until early this year had seen continued public protest that resulted in the deaths of more than 40 people and dozens injured as Haitians attempt to force President Jovenel Moïse to resign.

“Haiti has been extremely positive. Sales are back to normal and we are selling at fairly good prices. The only potential downside to Haiti is the devaluation against the US dollar, ”Parsard noted.

“If we do, we suffer a significant devaluation, we risk incurring more currency losses than we would be comfortable with. However, the operation is going well, ”he said.

[email protected]

Source link