'We are competitive in the market now' Seprod managing director Byron Thompson.- Ian Allen/Staff PhotographerSEPROD HAS honed down its industrial base to a platform from which it can compete, says managing director Byron Thompson.
Once a sprawling industrial giant, in the last two decades Seprod has exited the production of soap, bleach, detergent and animal feed in a drive to rationalise its production, Mr. Thompson told Wednesday Business in an exclusive interview. The company is focused on developing its present assets.
"We are competitive in the market now," Mr. Thompson said. "But by 2005, the Caricom duties will start going down. We are preparing for that day."
For Seprod's margarine and shortening, the Caricom external duty protection is 20 per cent.
Over the last two months the company made its labour force redundant and re-employed most on fixed term contracts. The contracts give the company more flexibility in deploying its workers, allowing for greater operational efficiencies.
Seprod now has 37 fewer workers, but still has 130 at its main Caribbean Products plant and maintains an overall employment of approximately 300, he said.
"We have done some restructuring of our labour force," Mr. Thompson said. This was done with the expectation of gaining an improvement in labour productivity.
But that is only a part of the change taking place at Seprod.
"We are spending $150 million to upgrade our plants this year," he said. The company is moving to achieve world class competitive standards requiring changes in the labour force, but also in the physical plant and management.
Last year the company spent $60 million on improving plant and equipment. It also introduced new computer software to better manage its human resources and purchasing.
"We dropped some product lines that were not profitable," he said. At the same time, "We are looking at new products."
In the highly protected markets of the past, Mr. Thompson said manufacturers could make a product, comfortable in the knowledge that their customers would buy it.
Market liberalisation means that the customer now has alternatives, he said. The changes underway at Seprod are aimed at ensuring the company is able to keep a viable customer base in the open market.
"Previously we had one brand of shortening on the market," he said. To better serve the different market segments "we now have 12 different brands."
Seprod now has two manufacturing plants producing edible oils and fats and another producing cornmeal. There is also a distribution company for a range of food products including its own brands.
"We have looked carefully at the business we should be in," he said. "Those that we have taken on, we will be the best in them."
A decade from this there will probably be fewer companies in Jamaica's industrial sector, he said. But those that remain will be bigger and stronger.
"People sitting back waiting will be left behind," he said. For manufacturers, "It is not going to be a piece of cake, but I am optimistic.
