Improving City Markets

Grand Bahama Chamber of Commerce President K. Peter Turnquest said he hopes the impending sale of the City Market foodstores will improve the quality and quantity of inventory the three local establishments offer, which residents have complained about for months.

Last week, it was revealed that BSL Holdings Limited, the company that operates the City Market stores, had entered into a memorandum of understanding with Associated Grocers of The Bahamas Limited (AGBL) for the sale of its 77.762 percent of shares.
The sale, which is subject to regulatory approval, is expected to close on or before November 5, the company has said.

The remaining 22.238 percent of shares in the stores are owned by the Bahamian public and their ownership under the transaction is reportedly unaffected.

Turnquest told The Freeport News on Friday that he had been disheartened to see the struggles the company was going through, and almost expected that a sale would be imminent.

"I think we are all aware that City Markets has had some difficulties. If we observe what's happening in the stores – the level of goods that they seem to have available – they seem to have been going through some difficult stages," he said.

"So I'm not surprised that they're seeking to restructure their organization and I think that any entity that may come in that can enhance their brand certainly is welcome news because City Markets has been around for many years and we've come to rely on them to provide services."

Turnquest said although details of the sale have not yet been made public, it is his opinion that any effort to consolidate and to improve the offerings that City Markets has will be welcome.

Also weighing in on the topic this weekend was Member of Parliament for Fox Hill Fred Mitchell, who has expressed concerns in the past about the company's operations.

In a statement released to the media, Mitchell said he is not too concerned about which entity buys the company at this stage, as long as the transaction is a legal one, but said there must be full and frank disclosure as to who the persons behind the company making the purchase are.

Mitchell said he believes the important issues surrounding the sale will be whether any jobs will be lost in the process and whether the enterprise will "return to the kind of company that supplies quality merchandise at affordable prices with an adequate supply chain.

"The business model that was utilized by the former owners did not deliver any of the security that Bahamians had come to expect from this company," the statement reads.

"I visited the stores today and the shelves were bare, the employees indifferent. This did not seem a happy place. Let us hope that this now changes."

Buyers circle City Markets' Freeport stores

By NEIL HARTNELL

Tribune Business Editor
Freeport, Grand Bahama-City Markets has received offers to acquire/take over all or some of its three Grand Bahama-based stores, including an approach from Sawyer's Fresh Market over its Eight Mile Rock outlet, but the listed supermarket chain's chief executive told Tribune Business that "nothing is signed or concluded" in terms of any deal.

Derek Winford confirmed Tribune Business's previous exclusive revelation of Sawyer's Fresh Market's interest in City Markets' Eight Mile Rock store, but denied that any agreement for the rival grocery/food retailer to take it over had been reached.

Explaining that the numerous approaches from potential buyers had been sparked by City Markets' recent financial woes, and the perception that the Freeport stores were difficult to manage being on a different island to the company's Nassau-based headquarters, Mr Winford said he planned to "beef up management" on Grand Bahama in the hope this would dissuade interested suitors.

"In Freeport, we've been approached by a number of people, but nothing is signed, nothing is concluded," he told Tribune Business. "We've had offers for the downtown store and the Lucaya store, we've had offers for the Eight Mile Rock Store, and had offers for all three stores.

"Sawyer's did approach us, but many people have approached us. People are offering us money for the Freeport stores. That's just the business. They see you appear to not be doing well, and say: 'Let me get it off your hands'."

Mr Winford said City Markets and its immediate parent, Bahamas Supermarkets, planned "to protect the interests of our workers ourselves, which is why we're looking at beefing up management.

"I want to beef up management in Freeport, and then maybe people will stop approaching us," he added.

Tribune Business reported yesterday how City Markets appeared to be stemming the bleeding that left the company with an accumulated deficit of $16.805 million as at year-end June 30, 2010, its fourth quarter loss for that financial year having come in at $873,000.

Still, the 11-store supermarket chain posted a $7.431 million net loss for its 2010 financial year, a 22.4 per cent increase over the previous year's $6.069 million loss, although nowhere near as bad as the $13.5 million plunge into the red for 2008. The company's balance sheet position appears to be changing little, though, with cash on hand only increasing by almost $8,000 during the year to $59,024, indicating the firm still has to spend most of what it earns and can put little aside in reserve.

Accounts payables, which represents sums owed to creditors such as suppliers in the Bahamian wholesale industry, reduced narrowly over the year, falling to $10.541 million as at the 2010 year-end, compared to $10.867 million the year before. Mr Winford emphasised to Tribune Business that while City Markets had re-started its direct import programme, the company wanted to work with Bahamas-based suppliers, especially if they could match direct import prices.

"We'd prefer to keep the business with local suppliers is possible," Mr Winford told Tribune Business. "If they're able to match the imports, we'd prefer to work with the local guys."

He added that City Markets sales were "as expected for this time of year, which a tough time of year, apart from the Back-to-School blip. This is the worst period for retail. July, August, September is a tough time to get through; the toughest time for is. Everything is very tight at this time".

Mr Winford also told Tribune Business that the fact more than $1 billion in Bahamian commercial banks loans were over 30 days past due "doesn't make me very encouraged".

"That's money taken away from retailers, and we have 700 jobs to protect. We want that money to come into the store," he added. Despite City Markets' travails over the past three years, and the depressed economy, Mr Winford sounded an upbeat note for the 22 per cent minority Bahamian shareholders. He said: "We keep making things better and better.

"We're making progress. There's no question better times are ahead."