Honey Bun upgrades for export
Published:Wednesday | March 30, 2011 | 12:00 AM
Pastrymakers Honey Bun plans to raise about J$50-60 million from its pending initial public offering, some of which will fund ongoing automation of its production line and the roll-out of new products.
Chief Executive Officer Michelle Chong said Monday that the investments should position the company to pursue new markets overseas.
Two weeks ago, the company introduced a new coconut roll to its range of some 20 products. At least five more products will be introduced this year, Chong said.
Last year, the company spent J$45 million on capacity upgrades, and has recently acquired equipment to automate one of its production lines, in order to improve efficiency at the factory, said Chong.
"A lot of equipment was purchased last year, so the equipment we would now acquire would be items to make the plant more efficient in terms of costs that we can ... more locally and be more competitive for the export market, which is the main source of growth for us going forward," Chong told Wednesday Business.
Chong and her husband Herbert started the Retirement Crescent, Kingston-based operation 29 years ago, and at last count two years ago, the business had a market share of more than 38 per cent. Their plan is to grow volume sales by approximately 30 per cent.
The CEO said the factory upgrades would not cut jobs, and that the company actually planned to grow its staff complement by boosting its sales team.
The company's premium products are its cinnamon, cheese bread and donut offerings that are currently dominant in the individually packaged baked goods market.
The firm operates in a market that also includes HTB, Yummy and Dr Lushus Bakeries as its main competitors, along with a number of other small players.
Production takes place at two facilities - an 11,000-square foot plant at Retirement Crescent where Honey Bun's bread and donut lines are produced, while its cake line is rolled out at East Street, downtown Kingston, at a 6,000-square foot facility. Its market and sales offices are at Beechwood Avenue.
"We operate 24 hours, seven days per week and employ 195 to 200 workers, with additional workers being hired during the Easter season," Chong said during a tour of the facilities on Monday.