CAC 2000 heads to Montego Bay with retail store
Less than a year after opening its first stand-alone retail store in Kingston, 23-year-old air-conditioning company CAC 2000 is about set to add another retail outlet in Montego Bay, next month, as it goes after additional business in the competitive AC market.
Currently, CAC 2000 estimates that it controls roughly 25 per cent of the retail AC sales and service market – or in industry-speak the ‘transactional’ market – by making it easier for consumers to access its products.
The new Montego Bay store, to be located in the National Supply Complex, will offer AC units, air-purifier systems, fans, and solar panels for sale, similar to that of the Village Plaza store in Kingston, which become operational earlier this year. Foot traffic at both locations is expected to be comparable.
CAC had not planned on setting up shop in Montego Bay until 2025, allowing itself time to recoup some cash from its $15 million investment in the Kingston store, but its timeline changed when new opportunities emerged.
“We got a call saying there was an availability for a store, and when we went and looked at the location, it would not have been good business sense to walk away from the location, and, therefore, we decided to take the chance on it,” CEO Gia Abraham told the Financial Gleaner following the company’s annual general meeting, which was held at CAC’s head office at Three Miles, Kingston.
The company is still tallying the cost of the new buildout, but it is expected to run close to that of the Kingston store.
CAC already has a presence in Montego Bay, where it has operated a maintenance unit for several years, but the new store will be its first direct push into the consumer market in the resort city.
“When we did a survey, most people did not think of CAC if you talked about mini splits or air purifiers, and so over the next couple of years, our aim is to be better known in the market for transactional items as well,” Abraham said.
CAC 2000’s sales revenue currently tops $1 billion annually, and roughly 70 per cent of that comes from commercial contracts or the project portfolio in industry terms, an area in which it goes up against JT refrigeration Services and Arel in the jostle for business. On the transactional or retail sales side, its competitors include Carlisa, Appliance Traders, and Geddes Refrigeration.
CAC is looking to expand at a time when its revenues are under pressure, having dipped 16 per cent year on year for the first nine months of its fiscal period.
Amid the fall in sales, nine-month profit skidded to a loss of $74 million, almost four times the $20 million of losses racked up in 2022.
CAC has a better outlook on the upcoming 2024 financial year, however, largely related to its portfolio of confirmed projects worth $650 million, as well as its other efforts to open up fresh channels for sales through the retail market.
Over the short term, CAC says it will focus on growing its retail client base at the two stores, part of which will include leveraging strong business relationships. Otherwise, the AC supplier wants to grow its product range, starting with the expansion of the offerings under its recently launched Vytal brand for AC units. However, Abraham was tight-lipped on the details.
The company is also going after additional business in the water-purification market outside of its treatment services for water coolers in business firms, airports, and hotels.
“CAC has always been involved in water purification to a certain extent, but the general public doesn’t necessarily know about it. But what we have come to recognise is that within Jamaica, there is an issue with drinking water,” Abraham said.
“A lot of people can’t necessarily afford an under-the-sink solution, so I’m looking into economically viable products that I can bring into the market that people can use for water purification in their homes,” she added.
Over time, she also wants to target small commercial operators and eventually, larger business firms.