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ARC acquires new property, expands retail store

ARC Manufacturing Limited has acquired the 26,000-square foot property located at 14 Bell Road, which previously housed Starfish Oils Limited, adding to its 20-acre lumber treatment and construction material-producing plant.

The acquisition of the property, which took place last month, was financed from the company’s cash resources, Norman Horne, executive chairman, told the Jamaica Observer following a tour of the facility with a team from the NCB Financial Group led by Chairman Michael Lee-Chin.

“We’ll be using that area to build out and grow even greater our cement operation, and that includes storage of all the different sizes of cement bags,” Devon Brooks, the general manager responsible for commerce, disclosed.

Last year ARC Manufacturing entered into a five-year deal with Caribbean Cement Company Limited to distribute cement, extending an already existing 10-year arrangement. The new facility has been designated to store 250,000 bags of retail cement and 200-plus large bulk bags of the commodity.

So far, the company has renovated the space and removed the boundary walls that will create lateral access to the new property. There are no immediate plans for new, Brooks responded when asked.

He added that the adjoining space will resolve some logistics challenges the company faced with storage capacity and also accommodating delivery trucks.

“It will allow us to treat logistics aspects as it eases turnaround with our trucks, and so we can meet our customer demands even greater. As you can clearly see here that can become very cumbersome — a lot of traffic in that location,” Brooks pointed out.

“ARC is one of the only companies in Jamaica that boasts 24-hour delivery, and certainly a facility like that will allow us to even fulfil even shorter delivery expectations for our customers,” he continued.

The commercial manager is, however, expanding the cement distribution segment of the company boasting that ARC is Caribbean Cement Company’s largest customer in Jamaica.

In addition to the new property acquisition, Brooks also revealed that the company has expanded its retail space at the original Bell Road property.

“We are moving from 8,000 square feet to in excess of 30,000 square feet of warehouse space as well as floor store space. We are moving from an operation where we had over-the-counter to now a supermarket-style layout where persons can go and pick up the items from the shelf themselves,” he informed the Caribbean Business Report.

“And certainly with the new space we will be integrating new technology, new bar code system, where persons can easily identify and help themselves with easy scans and certainly we’re bringing our First World-type of feel to Three Miles,” he added.

When asked if ARC will introduce the same model to its Montego Bay location, Brooks noted that the immediate focus is to fine-tune the retail operation in Kingston. He added that the company’s focus at this time is organic and inorganic growth.

“And certainly you can grow by adding locations or you can grow by becoming even more efficient at how you distribute and how you get to your customers…We would have employed both those strategies in our growth so far. We would have acquired a new location and we would have gotten far more efficient in how we meet the customer’s need, so those continue to feature in our objectives going forward,” Brooks said.

Published by The Jamaica Observer.

Time to Build!

Following record high building material prices due to lumber shortages in July 2020 and plywood shortages earlier this year, homeowners are being told that now is a good time to start building again as prices have started to normalise.

Managing director at Arc Manufacturing Deanall Barnes told the Jamaica Observer the market is now adequately supplied with building materials. In addition to that, he highlighted that prices have already started to trend downward which should make these items more affordable for the average Jamaican.

“There’s a slowdown in China which has made more steel available for export which is increasing global competition and dragging down steel prices.” Barnes revealed that steel prices are down 10 per cent, form-ply down 15 per cent and lumber products down 12 per cent.

With that said the building materials company is reporting that sales are up, in line with the construction boom. Last week the Planning Institute of Jamaica (PIOJ) reported that the construction industry continued its year-long growth trend with an uptick of 1.7 per cent for the July to September quarter.

Barnes said that based on research “there was a significant uptick [in construction] from Jamaicans in the diaspora.” He added that further discussions with financiers also revealed that there’s an increase in the demand for mortgage from persons in the diaspora.

“Those who did not have any form of property started looking to buy property in Jamaica and these property range in terms of prices from US$70,000 to as high as US$1.5 million. In addition to that, there are some persons who owned the land itself but there was no building on it, they started construction and when we had a discussion with the hardware owners they said there were persons who started and stopped and have now restarted.”

Barnes stressed that the major developments like high-rise apartments and road constructions do not impact his revenues as much as domestic construction. He described domestic construction as homeowners adding an additional room or retrofitting existing structures to accommodate the work from home lifestyle.

He said those activities, which constitute the core of the construction industry ,“has remained relatively healthy over the last 15 months.”

At the same time, he’s urging the Government to follow through on its commitment to increase the housing stock in Jamaica which will provide another added boost.

“We know to a large extent that the Government has not even achieved 30 per cent of its target to build 70,000 homes as yet. So we expect that the Government will push, through its agencies, whether the NHT (National Housing Trust) or the HAJ (Housing Agency of Jamaica), to try and get these numbers up and once the Government is firm on its path, then we are very confident that there will be a buoyancy in the industry despite the headwinds.”

At the same time, he is demanding that the Government find a way to remove red tape from the building approval process. He said removing red tape will provide a well-needed boost for construction workers who are left without an income while the approval process is being drawn out.

“There’s still an issue based on the discussions that we’ve had with some of the major developers in the country that the bureaucracy is still holding back the timeline in which projects are approved, and that lag in itself has caused negative impact on our industry.”

Another obstacle, he argued, is the Bank of Jamaica’s (BOJ) decision to increase its indicative monetary policy interest rate.

“The increase in interest rates by the BOJ although we understand it from the perspective of trying to manage inflation, there are some immediate deleterious consequences. Most, if not all, financial institutions are going to increase the rates charged to customers, so mortgage rates might go up as well as general loan rates so that can have a negative impact on the growth or continued boom.”

Nevertheless, he maintains that there’s hope on the horizon. “We are cautiously optimistic. There are some projects that have started which we expect to continue.”

Published by The Jamaica Observer.

Making a Way for Aspiring Dentist

Dupont Primary’s top PEP performer is on her way to achieving her dreams of becoming a dentist following ARC Manufacturing’s contribution to offset tuition and book expenses for the new academic year. Lakaica Greenland (centre) was joined by her mother, Jamila Persad (right), during the presentation from general manager – operations & transportation logistics, Yvonne Dacres (left).

Published by the Jamaica Gleaner.

ARC Manufacturing Nails Down Expansion Plan

ARC Manufacturing to transform Ferry Pen into manufacturing and distribution hub; Manufacturing plants to cover 18 acres of land

Construction and building supplies manufacturer, ARC Manufacturing has outlined an ambitious plan to develop the Ferry Pen area, which encompasses its Bell Road, Kingston 11 base, into a massive manufacturing and distribution hub.

Ferry Pen is located in the Three Miles area and is adjacent to Spanish Town Road on the left heading from Kingston. ARC Manufacturing chairman, Norman Horne, who made the announcement in an exclusive interview with the Caribbean Business Report, disclosed that the current Bell Road head office will be converted into a 100 per cent manufacturing facility.

The manufacturing facility will cover the entire 18 acres of land, which includes the former KIW warehouse, which ARC acquired from the Government some years ago and is currently being used for its lumber depot and warehousing facility. The acquisition of the warehouse property has allowed ARC to continue operating from that location which spreads towards its headquarters on Bell Road in Kingston.

“We have some other factories that we intend to bring on board at this facility,” Horne divulged. ARC Manufacturing, which is one of the leading manufacturers and distributors of premium-quality building materials in Jamaica, operates a series of plants on Bell Road, which stretches several football fields in length and width towards Spanish Town Road.

Two years ago ARC expanded to set up two additional plants that manufacture roofs and chain fencing. When quizzed about the plan, the ARC chairman explained that the development has been in the works for some time but the plans have had to be pushed back due to COVID-19, which has caused things to slow down a bit.

Horne was quick to add, “As soon as COVID-19 is over us, we plan to get back on track.”

FERRY PEN DEVELOPMENT WILL INCREASE COMPETITIVENESS

He emphasised that the overall plan for the manufacturing and distribution hub in the Ferry Pen area will make the company and its manufactured products more competitive. According to Horne, “We believe that we can produce a number of products competitively in Jamaica, not just for the local market but also for the export market.”

The ARC Manufacturing chairman declared, “I am encouraging the Government to pay more keen attention, in not necessarily protecting the domestic market but also increasing the competitiveness of local manufacturers so that local products will have a greater reach in the domestic market.”

Last week ARC Manufacturing won the support of US Ambassador to Jamaica Donald Tapia, who committed to assist the company with finding markets in America for its products. The US ambassador made the announcement during an interview with the Jamaica Observer following a tour of the company’s 14 Bell Road, Kingston 11, plant last week Thursday.

ARC Manufacturing produces a range of products and services including wire and steel products, chain-link fencing, aluminum-steel roofing tiles and more. The 18-acre plant features seven factories, including a state-of-the-art lumber treatment plant.

Published by the Jamaica Observer.

US Ambassador Promises to Help ARC with Finding Markets in the US

Building supplies manufacturer and distributor ARC Manufacturing has won the support of US Ambassador to Jamaica Donald Tapia who has committed to assisting the company with identifying markets in America for its products.

The US ambassador made the announcement following an interview with the Jamaica Observer’s Sunday Finance following a tour of the company’s 14 Bell Road, Kingston 11, plant on Thursday. ARC Manufacturing is one of the leading manufacturers and distributors of premium-quality building materials in Jamaica.

Its range of products and services include wire and steel products, chain-link fencing, aluminum-steel roofing tiles and more. The 18-acre plant features seven factories, including a state-of-the-art lumber treatment plant.

The courtesy call by the US ambassador was driven by his desire to see how manufacturing companies in Jamaica are weathering the impact of the COVID-19 pandemic. Ambassador Tapia told Sunday Finance that he is impressed with ARC’s operations.

TAPIA COMMITS TO HELP

He emphasised that despite the challenges faced by the company with COVID-19, “the future looks bright, and I think that together we might be able to open up some markets in the US that he [Norman Horne, ARC’s chairman] has not been into”. Ambassador Tapia made the point that COVID-19 is a problem for all countries, especially their manufacturing sector.

“What I am looking forward to is talking to Mr. Horne on what we can do to help exporting. We need to raise the export into the US or the export of Jamaican products into the US,” the US ambassador explained. Tapia also promised to assist ARC to get an audience with industry players “and put something together so he [Horne] can start exporting products that he is actually manufacturing here.”

AMBASSADOR PRAISES ARC FOR NO LAYOFFS

Turning to the issue of staff retrenchment given the impact of COVID-19, Ambassador Tapia heaped praises on ARC for keeping staff levels constant in spite of the fall-off in business as a result of COVID-19. “The thing that impresses me is during COVID-19 that he [Horne] is doing everything possible to maintain the number of employees that he has…that’s huge for somebody to step forward and try to maintain every employee.”

Horne, who led the tour, told Sunday Finance that they both would be having extensive discussions about COVID-19 and its impact on the business.

Published by the Jamaica Observer.