FRESH from its successful additional public offer (APO), commodities distributor Derrimon Trading is now ready to expand its own branded products, which will be given a significant push this year.
Conceding that the focus over the recent period has been on growing the business organically, the management of Derrimon is now zeroing on its own branded products as part of Derrimon 2.0, which represents its growth strategy moving forward.
Explaining that the APO was the precursor to Derrimon 2.0, Derrimon Chairman and CEO Derrick Cotterell admitted that part of the proceeds from the equity subscription will be used to grow its own branded products such as the “Delect” suite of food products.
Delect family of foods is Derrimon Trading’s flagship brand. Included in the Delect family of foods are rice, canned mackerel, ketchup, vegetable oil, cornmeal and other food items.
Speaking at last week’s Observer Business Forum, Cotterell remarked that having been successful at growing the company, the time is now applicable for building out Derrimon’s branded products.
The idea behind Derrimon promoting its own branded products, says Cotterell, is to give consumers products which, while being similar, are different and unique and deliver more value to them.
According to Cotterell, “Derrimon is now at the stage where we want to expand our own brands to give shareholders and customers better value. We have Delect and other brands…All this is to transform the whole company from just being a company of commodities.”
Cotterell, who formed the company along with his wife in 1998, is bullish on his expansion plans for the business, stating that the plans he has for “Derrimon is to turbo charge the growth of the company through Derrimon 2.0”. Cotterell sees Derrimon as a local company that will have a global reach.
He disclosed that the brand roll-out will focus on products that offer great value to consumers. For his part, Derrimon’s Chief Financial Officer Ian Kelly pointed out that the company has already identified the gaps in the market which it can exploit through new and current branded products.
“We see these gaps on both the domestic and international market side…we are at the stage where we will be getting into some of those products and to supply them in both the local and international markets,” Kelly told the Observer’s Business Forum. He added that the emphasis will be on innovation.
Delect, he declared, is going to be different in the market place and is very optimistic that the brand will do well moving forward.
LEVERAGING US ACQUISITIONS TO GROW DERRIMON’S BRANDED PRODUCTS
Cotterell and Kelly highlighted that the recent American acquisitions of Brooklyn-based grocery store businesses Foodsaver New York and Good Food for Less, is very strategic in this thrust by Derrimon to grow its own brands. They pointed out that the company plans to use these food establishments to grow Derrimon’s brands and business in North America.
Derrimon is said to be pumping US$9 million ($1.3 billion) into the acquisition, which the majority of the proceeds from the APO will fund, the APO having raised over $4 billion. Around a third of the APO proceeds of $1.2 billion will be used repay debt, while $1.1 billion will fund the purchase of Foodsaver and Good Food for Less.
Some $500 million will fund the expansion of retail operations in the parish of Clarendon and $200 million will be poured into the Delect food brand and product line. Cotterell is adamant that Derrimon will this year push further in its drive for greater market share, not just in Jamaica but also in other markets in the Caribbean and North America.