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Kingston jerk centres enter fast lane
with Kimberly Thelwell
Wednesday, August 11, 2010
var addthis_pub="jamaicaobserver";
FOR at least two decades, fast-food chains have dominated the restaurant scene in Kingston as individuals continuously seek lower cost alternatives, given the high cost of living and limited disposable incomes. However, as the prices at these quick service restaurants continue to climb steadily, many people have been discovering Kingston's latest trend -- jerk centres. Jerk eateries in the capital city have recently been increasing in number and have saturated the business district of New Kingston and its outskirts, providing a hidden oasis for those looking to enjoy a healthier meal at an affordable price.
Jerk centres are indigenous to Portland, where the cooking style originated centuries ago. However, it wasn't until recently that this business model gained popularity in Kingston as entrepreneurs recognised that an opportunity existed to grab a portion of the market share from fast-food chains, which begun to experience a fall-off in sales. Importantly, since 2009 fast-food restaurateurs have raised prices at least four times, citing increased input costs such as electricity, beverages, seasoning and packaging. Additionally, some restaurants have passed on a portion of these increases to customers, by limiting the number of condiments and other items that typically go along with a meal and requiring payment for extras. A meal from one of the three major fast-food operators -- KFC, Burger King or Island Grill -- will run an average of $423.00, an increase of 6.7 per cent, versus an average of $397.00 at the end of 2009.
At the same time, there has been an uptick in the number of jerk centres to choose from that offer prices that are on par, and in some cases even cheaper than the traditional fast-food restaurant. On average, a meal at a jerk eatery (such as a quarter chicken plus a choice of carbohydrates) costs $400.00. For years, Chelsea Jerk Centre, often regarded as the pioneer jerk centre in Kingston, remained the main contender in New Kingston. Apart from Chelsea's, Kingstonians who craved jerk cuisine were limited to "pan chicken" vendors and other street-side operators. However, as the demand for authentic jerk increased, so too did the number of options available for diners. Some of the more popular names which have recently been opened include Jojo's Jerk Pit, Truck Stop, Sweetwood Jerk Joint and Scotchies.
Each of these restaurants offers a unique dining experience and ambiance -- taking the jerk experience to the next level. Specifically, Jojo's offers a variety of menu options along with live music each Saturday for the ultimate casual dining experience. Apart from Jojo's, Sweetwood, located opposite Emancipation Park, has become a convenient lunchtime spot that boasts a head chef who trained with the Maroons in Portland. Scotchies has become the latest addition to the Kingston family of jerk connoisseurs, opening its doors this summer and bringing its renowned authentic jerk taste from the North Coast to Kingston.
Notwithstanding, jerk pits have a significant commonality -- a laid-back environment nestled amid the hustle and bustle of busy city life. Most of these restaurants are outdoors and some even boast thatch huts, reminiscent of a rustic island getaway. Some like Scotchies boast full-service bars, attracting patrons who are looking for a place to kick back after a long day's work. And though the newest member of the pack has only been in operation for a few weeks, based on initial traffic, it is evident that the restaurant's strong brand recognition has travelled from its Ocho Rios and Montego Bay branches to the Corporate Area, dispelling any concern that New Kingston was an inconvenient location that was oversaturated.
While jerk centres certainly have clear advantages over fast-food operators, fast-food chains still dominate the industry for a number of reasons. Firstly, as the name suggests fast-food chains are in the business of providing quick service for persons whose schedule may not allow for a home-cooked meal or formal dining experience. Convenience is the order of the day at these restaurants which are opened seven days per week, with longer opening hours compared with jerk centres. For example, Jojo's only opens its doors three days a week -- Thursday to Saturday. Some fast food operators also offer the added ease of drive-through service. Lastly, fast-food chains are not concentrated in the New Kingston area, as they have several branches ideally scattered throughout Kingston and the rest of the island. Scotchies is the only jerk pit that has several locations island wide, however, so far it only has one branch in Kingston.
Fast-food joints have also become the leading players in the restaurant industry due to strong brand recognition. Everything, from the restaurant building to cups and napkins, is branded. Not surprisingly, advertising and marketing costs account for a significant portion of operating expenses for these businesses versus jerk centres. Overall, fast-food chains tend to require a bigger capital outlay due to the type of service offered and also the scale of operations. On the other hand, start-up and maintenance costs are typically less exorbitant for jerk pit operators.
The popularity of jerk centres in Kingston continues to be sparked by strong demand from diners who are constantly seeking low-cost food, especially as traditional fast-food options have become more expensive. This phenomenon demonstrates the basic principles of entrepreneurship -- identifying and satisfying a growing market need. Jamaica Broilers Group Ltd (JBG) did just that via its investment in ethanol as alternative and affordable energy sources became a priority for Jamaica. Over the past several quarters, the group's Ethanol division has been its fastest growing segment, climbing 61.44 per cent for fiscal 2009/2010 from the year-ago period. Though revenues from this segment have declined recently, it should be noted that ethanol is a cyclical market and as global ethanol prices climb the expectation is that the Group will continue to benefit from its investment. Over the past month, ethanol has risen by 6.25 per cent to US$1.70 per gallon as crude oil prices have increased.
Taking a cue from JBG and other pioneers, jerk centres now have the opportunity to further expand islandwide by growing their branch network or through enfranchisement. It will be interesting to see how the fast-food industry evolves as jerk centres provide a competitive alternative in challenging economic times.
Kimberly Thelwell is the Senior Investment Analyst at Stocks & Securities Ltd. You can contact her at kthelwell@sslinvest.com.
with Kimberly Thelwell
Wednesday, August 11, 2010
var addthis_pub="jamaicaobserver";
FOR at least two decades, fast-food chains have dominated the restaurant scene in Kingston as individuals continuously seek lower cost alternatives, given the high cost of living and limited disposable incomes. However, as the prices at these quick service restaurants continue to climb steadily, many people have been discovering Kingston's latest trend -- jerk centres. Jerk eateries in the capital city have recently been increasing in number and have saturated the business district of New Kingston and its outskirts, providing a hidden oasis for those looking to enjoy a healthier meal at an affordable price.
Jerk centres are indigenous to Portland, where the cooking style originated centuries ago. However, it wasn't until recently that this business model gained popularity in Kingston as entrepreneurs recognised that an opportunity existed to grab a portion of the market share from fast-food chains, which begun to experience a fall-off in sales. Importantly, since 2009 fast-food restaurateurs have raised prices at least four times, citing increased input costs such as electricity, beverages, seasoning and packaging. Additionally, some restaurants have passed on a portion of these increases to customers, by limiting the number of condiments and other items that typically go along with a meal and requiring payment for extras. A meal from one of the three major fast-food operators -- KFC, Burger King or Island Grill -- will run an average of $423.00, an increase of 6.7 per cent, versus an average of $397.00 at the end of 2009.
At the same time, there has been an uptick in the number of jerk centres to choose from that offer prices that are on par, and in some cases even cheaper than the traditional fast-food restaurant. On average, a meal at a jerk eatery (such as a quarter chicken plus a choice of carbohydrates) costs $400.00. For years, Chelsea Jerk Centre, often regarded as the pioneer jerk centre in Kingston, remained the main contender in New Kingston. Apart from Chelsea's, Kingstonians who craved jerk cuisine were limited to "pan chicken" vendors and other street-side operators. However, as the demand for authentic jerk increased, so too did the number of options available for diners. Some of the more popular names which have recently been opened include Jojo's Jerk Pit, Truck Stop, Sweetwood Jerk Joint and Scotchies.
Each of these restaurants offers a unique dining experience and ambiance -- taking the jerk experience to the next level. Specifically, Jojo's offers a variety of menu options along with live music each Saturday for the ultimate casual dining experience. Apart from Jojo's, Sweetwood, located opposite Emancipation Park, has become a convenient lunchtime spot that boasts a head chef who trained with the Maroons in Portland. Scotchies has become the latest addition to the Kingston family of jerk connoisseurs, opening its doors this summer and bringing its renowned authentic jerk taste from the North Coast to Kingston.
Notwithstanding, jerk pits have a significant commonality -- a laid-back environment nestled amid the hustle and bustle of busy city life. Most of these restaurants are outdoors and some even boast thatch huts, reminiscent of a rustic island getaway. Some like Scotchies boast full-service bars, attracting patrons who are looking for a place to kick back after a long day's work. And though the newest member of the pack has only been in operation for a few weeks, based on initial traffic, it is evident that the restaurant's strong brand recognition has travelled from its Ocho Rios and Montego Bay branches to the Corporate Area, dispelling any concern that New Kingston was an inconvenient location that was oversaturated.
While jerk centres certainly have clear advantages over fast-food operators, fast-food chains still dominate the industry for a number of reasons. Firstly, as the name suggests fast-food chains are in the business of providing quick service for persons whose schedule may not allow for a home-cooked meal or formal dining experience. Convenience is the order of the day at these restaurants which are opened seven days per week, with longer opening hours compared with jerk centres. For example, Jojo's only opens its doors three days a week -- Thursday to Saturday. Some fast food operators also offer the added ease of drive-through service. Lastly, fast-food chains are not concentrated in the New Kingston area, as they have several branches ideally scattered throughout Kingston and the rest of the island. Scotchies is the only jerk pit that has several locations island wide, however, so far it only has one branch in Kingston.
Fast-food joints have also become the leading players in the restaurant industry due to strong brand recognition. Everything, from the restaurant building to cups and napkins, is branded. Not surprisingly, advertising and marketing costs account for a significant portion of operating expenses for these businesses versus jerk centres. Overall, fast-food chains tend to require a bigger capital outlay due to the type of service offered and also the scale of operations. On the other hand, start-up and maintenance costs are typically less exorbitant for jerk pit operators.
The popularity of jerk centres in Kingston continues to be sparked by strong demand from diners who are constantly seeking low-cost food, especially as traditional fast-food options have become more expensive. This phenomenon demonstrates the basic principles of entrepreneurship -- identifying and satisfying a growing market need. Jamaica Broilers Group Ltd (JBG) did just that via its investment in ethanol as alternative and affordable energy sources became a priority for Jamaica. Over the past several quarters, the group's Ethanol division has been its fastest growing segment, climbing 61.44 per cent for fiscal 2009/2010 from the year-ago period. Though revenues from this segment have declined recently, it should be noted that ethanol is a cyclical market and as global ethanol prices climb the expectation is that the Group will continue to benefit from its investment. Over the past month, ethanol has risen by 6.25 per cent to US$1.70 per gallon as crude oil prices have increased.
Taking a cue from JBG and other pioneers, jerk centres now have the opportunity to further expand islandwide by growing their branch network or through enfranchisement. It will be interesting to see how the fast-food industry evolves as jerk centres provide a competitive alternative in challenging economic times.
Kimberly Thelwell is the Senior Investment Analyst at Stocks & Securities Ltd. You can contact her at kthelwell@sslinvest.com.
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