The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

A leading water manufacturer says it had been forced to change its business model to help lower its high operating expenses, telling this newspaper that “utilities costs have killed us for the past four to five years”.

Tina Knowles, owner of Chickharney Beverages Ltd, producer of Chelsea’s Choice Water, said that adjusting the company’s business model would also help it avoid having to lay-off any of its 65 employees, calling the change a potential “win-win” for both the company and its customers.

Chelsea’s Choice has already begun informing its customers that effective October 1, its business model will change. The new depot price for a five-gallon bottle of water will increase from $2.50 to $3.

The company is also informing its customers that its plant, located on East-West Highway, will sell only bulk products to drivers with trucks, and that customers with less than 50 palletised bottles or 50 cases will be served at Chelsea’s Water Park by authorised drivers or other authorised depots and retail shops.

“We have been been plagued with very high utility bills for the last four to five years, I mean extraordinarily high, it’s ridiculous,” Ms Knowles said.

“That situation has not gotten any better and we have not had a price increase. Customs fees, production costs, everything has gone up. It has been very difficult to do what we do because of the very high cost of operating in the Bahamas.

“We had to change our business model because we also have VAT coming on stream,” she added.

We can’t operate from a panicked situation; we have to operate from a very logical situation. The change of the business model is good in many ways as we are trying to be in a position where we reduce the risk of failure ,and also improve the speed with which our customers are served.

“Right now we operate as fast as we can. That may not be great for some people, but we have been able to - up to this point - provide a premium drinking water at an affordable price. We are very grateful that we have been able to do that for so long. It’s basically the cost of operating, which does not allow us to continue in our previous model,” said Ms Knowles.

She added that adjusting the company’s business model would help to avoid laying-off staff. “We have a great team of employees and you don’t want to ever see a situation where you have to lay-off staff and the rest of it, so you have to adjust your business model,” Ms Knowles said.

“We are taking advanced steps, and it does a lot of things at one time. It allows the customer to not experience a drastic increase in the price of water. I can’t promise what’s going to happen when VAT comes on stream because no one knows exactly, except that all of our costs will be going up across the board.

“It’s basically the very challenging economy that we find ourselves in. Utility costs have killed us for the past four years. It’s just unfathomable that you have to pay those kind of rates. We regret that we have to make the changes that we have to, but we have to do it. The cost of living in the Bahamas really needs to come down.”

Ms Knowles added: “We’re concerned about producing a premium product at an affordable price That’s our core value. That’s what we stay focused on. We have had many challenges; we continue to be challenged, but be we have a great team here. We are steadfast in providing a premium drinking water at an affordable price, end of story.”

Ms Knowles added that the changes would hopefully provide greater efficiency and customer service.

“It’s really a win-win situation because hopefully we will expedite the service. Customers won’t have to get out of their cars. There is no risk involved in the yard ,which is far too congested right now,” she said.

“We will be able to cut down on some overtime because we can move faster. Right now we are limited as to how fast we can move because people are in the building.”