Caribbean news. Federick George of Alfundi Investment Limited, the company that brought the American fast food restaurant chain to Barbados more than four years ago, said the company could no longer sustain the high import duties on processed poultry products and serious consideration was being given to pulling the plug on the operation.
He told Barbados TODAY it had been operating at a loss for the past two years or so, and he was not sure how much longer it could continue to do so. In 2013 and 2014, George announced that plans to open other branches across the island had been shelved. He said closure of the two existing branches – Lanterns Mall and Trident House – was likely if the duties were not lowered.
This time, the restaurant boss said closure was unavoidable, as he described the high import tariffs as “absolute madness”. The company is required to pay 184 per cent duties on processed meats.
“It is a matter of how long we can sustain these high duties and it doesn’t look promising to us. It is difficult. We can’t make it . . . unless we get some positive response and this has been ongoing for close to two years. Unless we can get some positive action rather than talk we wouldn’t be able to sustain this,” lamented George.
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“I don’t even know if we are going to last six months.” The businessman insisted the financial losses had nothing to do with the establishment losing customers. He said Subway remained very popular but it could not recoup the monies paid in high duties by increasing the cost of the food.
“It is a sandwich shop not a gourmet restaurant, you can’t just raise prices on the consumer. There is a certain amount someone would pay for a sandwich and you can’t go higher than that because you just wouldn’t sell it . . . We give good service and fresh food and we really maintain a high standard but, unfortunately, there is a cost to that and with this exorbitant duty it doesn’t make economic sense,” said George.
He said besides putting Subway’s 30 employees on the breadline, the closure of the restaurant would hurt farmers and others who provided goods and services to the fast food establishment.
“We buy all of our produce locally. That means a lot of people that depend on us . . . are going to lose that trade and that is substantial,” George said. “Every branch we open is not only about who we are going to employ for that branch but . . . getting the carpentry done, the electrical and plumbing done, so you have a lot of ancillary jobs that are created because of this,” he added.
George said if things had gone according to plan, Subway would have had four more locations by now. The restaurant operator contended that Barbados was still lagging behind as far as facilitating business was concerned. “It is rather unfortunate but that is the way it is. If Barbados wants to step up to the plate and become part of the world family it has to change its way of doing business and stop thinking in the 1960s,” he argued.
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Stressing that other islands were paying between 20 and 40 per cent duty on pre-cooked meats, George said no one in Barbados or the region provided those products. “If we were able to get it here locally we would be more than happy. That is why we are getting all our vegetables locally. There is no need to go abroad unless there is a shortage, but when you are not producing something and the Caribbean is not producing it . . . Barbados stands out as the only island with these massive duties,” he said.
“There is nothing you can put on the plate and say there is a reason for this. There is none. You don’t supply it so there is no need to have this massive protection.” Minister of Industry, International Business, Commerce and Small Business Development Donville Inniss was out of the island and Acting Minister of Commerce Senator Darcy Boyce could not be reached for comment up to the time of publication. Article courtesy http://www.barbadostoday.bb
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