UBTR moving ‘in the middle of action’ with new Ocho Rios location
Tracks and Records Ocho Rios restaurant has been temporarily closed. Photo via KLE's website.
In a major move designed to minimise costs and attract more tourist arrivals, Franchise Jamaica (Fran Jam), the franchise operator of Usain Bolt Tracks and Records (UBT&R), has temporarily shuttered the restaurant in Ocho Rios and will relocate to a new location within by this summer.
Fran Jam is using the favourable circumstances created by the end of its current three-year lease to kick start a carefully-crafted contingency plan to secure a new location.
The existing location has proven challenging for many of the visitors with limited stay to be able to partake in tourist activities and enjoy the restaurant. In addition, being outside the action contributed to higher-than-normal customer acquisition costs, said Gary Matalon, chief executive officer of Kingston Live Entertainment (KLE) Group.
The KLE Group is a part owner of Fran Jam.
"As a result, we felt relocating to somewhere strategically located with easier access would help greatly. In addition, the local market would be better served as well," Matalon told Loop reporter Claude Mills.
KLE Group CEO Gary Matalon
"We are currently working with the team to have the location ready as soon as possible. Based on the level of work that will have to be put into creating an authentic space that is in keeping with the look and feel of our other locations, we anticipate a summer reopening however our primary focus remains on securing the site and getting all the elements right without compromise. We have timed this to correspond with the slow season and look forward to being up and running in time for the 2019/20 season," Matalon said.
Asked if this new location will be owned by KLE, he responded: "Interesting you should ask as KLE has been exploring expanding its corporate footprint across Jamaica to capitalize on already established infrastructure and achieve economies of scale. Having said that this territory is currently designated for a franchise."
The new location will feature all the bells and whistles of the old location as it relates to size, layout, menu options, with a few new wrinkles to pique the interest of patrons.
"The restaurant system will not vary too much other than the operational improvements, image enhancements (as seen in Mobay and London) and other innovations will feature as it will be a current model in contrast to the older model," Matalon said.
Photo of Tracks and Records raised dining area in Kingston via KLE's website
Matalon was tight-lipped on the magnitude of the expenditure on the new location.
"I don’t want to quote a figure at this point but the investment will be minimal given the bulk of the assets from Pineapple Place location will be able to plug right in here. The leasehold improvements will form the majority of the cost. The new location is far better positioned from a visibility and accessibility point of view. As I mentioned before, the customer acquisition cost at the previous location proved to be higher than normal. The fact that we had that level of success in the previous location is very encouraging... as we move in the middle of the action we expect far greater support from the visitors to the island as well as the locals," he said.
Matalon believes that this new restaurant will perform at an optimal level and contribute significantly to the company’s bottom line, saying that "revenues will be impacted in a positive way...we expect the new location to contribute significantly more than the previous (one)".
Matalon's sunny optimism may be based on the new location's proximity to tourist traffic.
"The previous location was ‘off-pitch’ yet we were still able to attract impressive tourist trade to the location. By becoming easier to access and being located closer to the action, we anticipate the numbers will grow significantly. In addition, the cost to acquire those customers will go down by a lot," he said.
Matalon's sanguine outlook is in stark contrast to the anaemic financial performance of the KLE Group, an inauspicious outcome that the entertainment company blamed on ongoing roadworks along Constant Spring corridor, where its prime money earner is based.
In March, it was reported that the revenue for the year fell three per cent to $220 million, an outturn that missed the company’s budgeted sales by 15 per cent. The KLE Group also faced administrative costs to get its franchise programme rolling, a development that haemorrhaged the company’s cash position at a time when revenues were under-performing.
The net result? The company ended the financial year 2018 with a net loss of $25.6 million, which totally erased the $9.6 million profit made the previous year.
Photo via Tracks and Records, Facebook
Still, Matalon believes that the company's fortunes are on the rise, and is convinced that Ocho Rios is a robust market with lots of potential for future revenues.
"We have always liked the Ocho Rios market mainly because of its potential. Fortunately, we are seeing in recent times where development is imminent and we are hopeful the Ocho Rios area will reach even a fraction of its potential. We will continue to play our part in this as we go forward," he said.
Matalon believes that the restaurant chain's franchises in Montego Bay and UK have performed favourably and generated revenues at a pace that augurs well for the future. KLE is also eyeing new locations in the near future.
"We are very happy with all Tracks and Records locations performance. Montego Bay is approaching one year in operation and we have seen steady growth since opening. London is only six months in and is still activating different revenue streams as it establishes itself in that market. The franchisees are aggressively seeking additional sites to take advantage of the momentum created there," Matalon said.
In other news, KLE has kiboshed plans for the Sumfest Acoustic Café so far.
"Sumfest Acoustic Cafe was placed on the back burner to allow us to focus resources on the expansion of Tracks and Records. We are now at a point where the smaller, fast-casual model becomes more relevant and a bigger part of our global expansion. We have been in discussion specifically around this and will have more to report as the year progresses," he said.