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Jam-Dex: Jamaica’s CBDC to Transform the Transportation Sector

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Jamaica’s central bank digital currency, Jam-Dex, is set to revolutionize how people pay for public transportation in the island nation. Local bus and taxi operators are eager to integrate Jam-Dex into their operations, as it offers convenience, security, and cost-efficiency.

Jam-Dex: Jamaica’s CBDC to Transform the Transportation Sector

Jam-Dex is the name of Jamaica’s central bank digital currency (CBDC), launched by the Bank of Jamaica in 2022. It is a digital form of legal tender that can be used to pay for goods and services, just like cash.

Jam-Dex is not a cryptocurrency, as it is issued and backed by the central bank and does not rely on a decentralized network of computers.

It can be accessed through a digital wallet app called Lynk, which allows users to send and receive Jam-Dex using their mobile phones.

Users can also convert Jam-Dex to cash or vice versa at authorized agents or deposit-taking institutions.

Jam-Dex transactions are fast, secure, and transparent, as they are recorded on a ledger maintained by the central bank.

Jam-Dex: Why is it important for the transportation sector?
The transportation sector is one of the key sectors that could benefit from adopting Jam-Dex, as it could streamline operations, reduce costs, and enhance security for drivers and passengers.

Aldo Antonio, co-founder and acting executive chairman of the National Transporters Alliance Group (NTAG), is actively championing the integration of Jam-Dex within the transport community.

“I see Jam-Dex as something that would be significantly transformative for the public transportation sector and needs to be embraced.”

Antonio believes that Jam-Dex could increase customer convenience and satisfaction, as well as reduce the risks associated with carrying physical cash or handling exact change. He also thinks that J

am-Dex could attract more customers to use public transportation, as it offers a modern and innovative way of paying for their rides.

“If we can get them (Jamaicans) moving and paying for transportation using Jam-Dex on a daily basis, it increases the rate at which we can get the digital currency into people’s hands.”

Challenges and Opportunities
Despite the potential benefits of Jam-Dex, its adoption rate among vendors and consumers has been sluggish, causing some hesitation among bus and taxi drivers.

According to local reports, only 10,000 vendors and 200,000 individuals use Jam-Dex through the Lynk app, which is far below the expected target of one million users by the end of 2023.

Antonio acknowledges that there are some challenges to overcome before Jam-Dex can become widely used in the transportation sector.

He cites the need for more education and awareness campaigns and incentives and rewards for drivers and passengers who use Jam-Dex.

He also emphasizes the importance of cultivating a larger customer base willing to embrace the CBDC, as the lack of customer interest could discourage merchants from accepting Jam-Dex.

However, Antonio remains optimistic about the future prospects of Jam-Dex, as he envisions that with proper training and implementation, the transportation sector could potentially begin accepting Jam-Dex payments by January 2024, if not earlier.

He also estimates that there are approximately 25,000 to 30,000 transportation owners in Jamaica whose participation could significantly expand the reach of Jam-Dex beyond the existing user base.

Antonio hopes that Jam-Dex will become a catalyst for digital transformation in Jamaica, as well as a source of pride and identity for Jamaicans.

He said:

“Jam-Dex is something that we should be proud of as Jamaicans because it’s our own digital currency.”

 

by Victory Emmanuel

Original Source article BY DASHAN HENDRICKS Business content manager hendricksd@jamaicaobserver.com

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Business Insights

Prime customers – Grubhub Expanding Partnership with Amazon.com Inc.

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Grubhub, the struggling US meal-delivery business, announced May 30 it was expanding its two-year-old partnership with Amazon.com Inc. and giving Amazon Prime members free food delivery.

As part of the new deal, Amazon also incorporated Grubhub’s delivery service directly into its shopping app and website, and increased its financial stake in the company owned by Just Eat Takeaway.com NV.

Grubhub Chief Executive Officer Howard Migdal told me this deepened relationship with Amazon will be a key catalyst for user growth and revenue. Prime members are a “good cohort” of customers as they tend to order more frequently than Grubhub’s average customer, he said.

So far there has been an immediate boost: Grubhub’s app downloads jumped 90% in the week of the announcement compared with the previous week, and the number of users opening the app rose more than 9% for two straight weeks, outpacing that of food and grocery peers. That’s according to Bloomberg’s analysis of data tracked by mobile research firm Apptopia.

But this could prove challenging to sustain. While the pace of overall order declines reported by parent Just Eat’s US and Canadian business has slowed in recent quarters, third-party data from market research firms SimilarWeb and YipitData show that the initial 2022 Amazon-Grubhub partnership hasn’t reversed the streak of losses in orders and users for Chicago-based Grubhub.

The company has dropped a significant amount of market share to delivery rivals DoorDash Inc. and Uber Technologies Inc. as they ramp up competition through offerings beyond just takeout meals from restaurants. Yipit’s data shows Grubhub market share fell to 6% in March from 11% in August 2022, with a loss in urban users the most pronounced.

Rivals in recent years have raced to expand the number and types of stores on their sites and improved their technology to let customers bundle multistore orders without additional cost, which Grubhub hasn’t allowed.

DoorDash and Uber, in particular, have enhanced their routing algorithms so their delivery couriers can seamlessly pick up a last-minute drugstore item, drinks from a liquor store, or condiments from the grocery store while en route to grab a restaurant order nearby. These upgrades let the companies “upsell” consumers and advertise relevant items to bundle into their order, helping expand the size of the basket and increase ad revenue from brands.

Making the Grubhub+ subscription free for the 180 million US shoppers who are part of households with a Prime membership could entice those consumers to keep their Prime accounts, which would be a boon for Amazon. But at the same time, it wipes out potential customers for Grubhub’s subscription service — and the revenue they might have generated. That makes the sale of Grubhub, which Dutch parent Just Eat has been considering since 2022, “less likely,” according to Bloomberg Intelligence analysts.

So far, a customer who tries to place a Grubhub order within Amazon won’t find it as easy as described. According to Grubhub, users can visit a dedicated website to start a Grubhub order; or they could be directed to that site through a variety of paths from Amazon.

On Amazon’s mobile app, the Grubhub button is hidden within the “Groceries” tab, below buttons for Amazon Fresh, the grocery delivery service, and Amazon’s Whole Foods. Alternatively, users can type “Grubhub” in the Amazon search bar to access the Grubhub banner. At least two more clicks are needed to launch the restaurant ordering interface in an in-app browser window, which makes the experience foreign to the Amazon app.

This makes the integration more of a bonus than a feature of convenience. Whether the deal can effectively convert new users to loyal Grubhub customers remains to be seen.

Source Natalie Lung Bloomberg

 

 

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Artificial Intelligence

The Rise of Drone Deliveries: Implications for Jamaica, the Caribbean and the Future of Logistics

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Amazon’s MK27-2 drone is at the forefront of transforming logistics with its ongoing testing at an airport in Pendleton, Oregon. This advanced 87-pound hexacopter is part of Amazon’s Prime Air initiative, aiming to revolutionize the way we receive packages by enabling faster and more efficient deliveries.

The Development of Amazon’s Drone Program
Amazon has been developing its drone technology for almost a decade, with the goal of creating a safe, scalable, and efficient delivery system. The MK27-2 drone, set for deployment in 2024, is designed to deliver packages weighing up to five pounds within a short time frame, potentially less than an hour from order placement. This drone features advanced sense-and-avoid technology, which allows it to detect and navigate around obstacles autonomously, enhancing safety and reliability​​.

Competitors in the Drone Delivery Space
Amazon is not alone in the drone delivery race. Alphabet’s Wing has been successfully conducting drone deliveries in Australia and is expanding its operations in the U.S. Flytrex, another competitor, is increasing its presence in the U.S., while Irish company Manna plans to extend its drone delivery services from Europe to the U.S. Each of these companies is leveraging technology to offer faster, more reliable delivery services, which are particularly advantageous in remote or hard-to-reach areas​​.

Implications for Jamaica and the Caribbean
The introduction of drone delivery services holds significant potential for Jamaica and the broader Caribbean region. These areas often face logistical challenges due to geographical constraints and infrastructure limitations. Drones can provide a cost-effective and rapid delivery solution, particularly for medical supplies, emergency services, and e-commerce.

Implementing drone logistics in the Caribbean could enhance supply chain efficiency, reduce delivery times, and lower costs. For instance, drones could facilitate better access to healthcare by delivering medications to remote islands or rural areas quickly. They could also boost the local economy by supporting small businesses in reaching a broader market with reduced delivery times.

Case Studies and Future Prospects
In practical applications, drone delivery services have demonstrated substantial benefits. For example, in Rwanda, drones are used to deliver blood supplies to remote hospitals, significantly reducing delivery times from hours to minutes. This model can be adapted to the Caribbean, where timely access to medical supplies is often critical.

Looking forward, the success of drone delivery in regions like the Caribbean depends on overcoming regulatory challenges, ensuring community acceptance, and building the necessary infrastructure. Collaborative efforts between governments, private companies, and local communities will be essential to harness the full potential of drone technology in transforming logistics.

Amazon’s MK27-2 drone represents a significant leap in the logistics industry, promising faster, safer, and more efficient delivery services. As other companies like Alphabet’s Wing and Flytrex join the fray, the competitive landscape will drive further innovations. For regions like Jamaica and the Caribbean, drone technology offers a transformative opportunity to enhance logistics and support economic development.

By leveraging these advancements, the Caribbean can not only improve access to essential services but also position itself as a leader in adopting cutting-edge logistics solutions. The future of drone deliveries is bright, and its implications for global logistics are profound.

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Businessuite Markets

Mailpac Group Tags MyCart Express Assimilation For Enhanced Revenue And Operational Efficiencies To Turn Things Around

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Khary Robinson Executive Chairman Mailpac Group Limited has released the following Directors’ Report To Shareholders for the quarter ended March 31, 2024.

Introduction

Mailpac Group Limited (“Mailpac” or the “Company”) presents its unaudited financial statements for the quarter ended March 31, 2024.

Throughout the quarter, Mailpac focused on closing on the acquisition of MyCart, a significant step in entrenching the business as the leader in e-commerce fulfillment in Jamaica. Not only will the transaction significantly expand market share and improve service delivery, but the brands in the group are now better positioned to meet the goals and needs of their respective target markets. Additionally, despite increased competition and external factors impacting efficiencies, our financial performance for the reviewed period was commendable.

Financial Performance:

In Q1 2024, Mailpac’s revenue came in at $368.5 million, down by 7.8% from the previous year mainly because of the reduction in Mailpac Local and commissions from the marketplace platform at Aeropost.

Despite the reduction, Gross profit for Q1 was $197.9 million, up by 3.6% compared to the previous year.

Operating expenses in Q1 totaled $130.8 million, a 13.6% increase year-over-year, mainly due to strategic investments in business growth and data protection remediation efforts.

Net profit for Q1 decreased by 16.7% to $50.1 million.

We anticipate profitability improvements in 2024 through customer base expansion and overhead cost reductions due to strategic enhancements and shared key operations between Mailpac and MyCart Express.

Financial Position:

At the end of Q1 2024, Mailpac’s Total Assets were valued at $626.3 million, with a cash position of $156.2 million.

Shareholder’s Equity stood at $537.9 million.

Outlook:

With the completion of the acquisition of MyCart Express at the end of March 2024, we are optimistic about the expected synergistic benefits, enhanced revenue streams, operational efficiencies and increased shareholder value from Q2 onwards.

We are confident that the decision to bring both brands under the same umbrella will position Mailpac for continued growth, industry leadership and success in e-commerce.

For More Information CLICK HERE

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Businessuite Markets

Future Energy Source Records Best Quarterly Performance To Date.

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Jeremy Barnes Managing Director For Future Energy Source Company Limited Has Released The Following Report For The Third (3rd) Quarter Ended December 31, 2023 For The Financial Year April 1, 2023 To March 31, 2024

Overview
We are pleased to report that the Company has achieved its best quarterly performance to date. The Company’s performance reflects an increase in gross profit, operating profit (EBIT) and EBITDA whilst acquiring and integrating an additional LPG filling plant (FESGAS Naggo Head), improving its brand awareness, and increasing its advertising, depreciation and interest expenditures.

The Company achieved:
1. Gross profit: J$423.21 million up J$182.82 million or 76.0% vs Q3 December 2022
2. EBIT: J$190.66 million up J$35.07 million or 22.5% vs Q3 December 2022
3. EBITDA: J$248.15 million up J$85.56 million or 52.6% vs Q3 December 2022
4. Net profit: J$149.25 million down J$4.07 million or 2.7% vs Q3 December 2022
5. YTD (9 month’s) Net Profit: J$465.95 million up J$31.56 million or 7.3%
6. Book value of equity: J$1.768 billion, which is up 35.8% since the last financial year ended March 31,2023 and up 51.8% or J$602.92 million when compared to Q3 December 30, 2022.

Further, the Company was able to:
1. Add its 21st FESCO branded retail service station to its network, FESCO Port Maria, in mid-December;
2. Acquire, integrate and operate its 2nd LPG filling plant facility, FESGAS Naggo Head;
3. Secure approval for its 2nd company owned and company operated service station, FESCO OVAL on Spanish Town Road;
4. Become the authorised distributor of Castrol motor oils for Jamaica;
5. Continue its service station network expansion efforts and work-in-progress Capex/investments.

Financial Highlights:

For the quarter ended December 31, 2023, FESCO recorded Turnover/Revenues of J$7,589.02 million which reflects a 13.0% or J$875.65 million year over year increase. Several factors affect revenue/turnover with the supply price of fuel being a major component.

On average, this quarter’s refinery prices have remained relatively flat for gasoline and have decreased significantly for diesel. Gasoline prices increased by between 0.75% and 1.9% or J$1.35- J$3.47 per litre and decreased by J$33.38 – J$34.04 for diesel relative to the similar period last year Q3 ending December 31, 2022.
Accordingly, FESCO’s growth in Turnover for the quarter (Q3) ended December 2023, relative to Q3 December 2022, reflects significant growth in litres of fuel sold.

FESCO recorded gross profit of J$423.21 million for the quarter which reflects growth of 76.0% or J$182.82 million year over year. The Company’s YTD Q3 2023/2024 gross profit of J$1,141.72 surpasses the gross profits earned for the entire year ended March 2023 by 28.6% or J$253.91 million and exceeds its YTD Q3 2022/2023 gross profits by J$495.08 million. The improvement in gross profit reflects both increasing throughput
(measured in litres of fuel sold) and diversification of product offerings (fuel types including LPG) and services (increased retail presence).

Operating Expenses of J$232.56 million, for the period, is up J$147.75 million versus the similar period last year or 174.2%.

This expansion of expenses directly reflects the expanded:
1. Operating locations including the additions of: FESCO Kitson Town, FESGAS Bernard Lodge and FESGAS Naggo Head;

2. Asset base which includes significant LPG and service station assets;

3. Operational scope (which now includes increased retailing and manufacturing);

4. Early stage new business costs including but not limited to:
a. business acquisition;
b. property acquisition and development costs; and
c. business integration costs.

The Company is committed to and has expanded its Marketing and Advertising expenditure to create brand awareness for its “FESGAS” branded LPG products, among other initiatives.

For the quarter, the Company’s advertising expenditure was J$14.06 million which is up 149.4% or J$8.43 million compared to Q3 December 2022. The Company’s Q3 (2023) YTD advertising expenditure of J$42.92 million exceeds last year’s Q3 (2022) YTD expenditure by J$29.62 million.

A look ahead
FESCO continues to monitor the moderating inflationary forces within the economy, the recent interest “freeze” by the central bank, the near full employment in many sectors of the economy, a resilient and expanding tourism product among other factors affecting consumer consumption as well as our allocation of investment capital. The Company must also navigate industry-related margin contractionary forces and consolidation within the industry. The Company remains mindful of opportunities for growth and further investment. Internal or self-funding via profit generation, profit retention, at this time, has proven to be the most efficient and cost-effective source of capital to fund growth.

The Company recently received approval for its proposed service station on Spanish Town Road, FESCO Oval. FESCO Oval will be a company owned and company operated service station (COCO) and will increase our retail presence within the Kingston and St Andrew (KSA) region. The development promises to showcase the creativity, forward thinking, mindfulness, commitment to community and the immense potential of Jamaica and Jamaicans and we believe it exemplifies our tag line and motto, “Proudly Jamaican”. The development will take approximately fifteen (15) months to execute and we anticipate its opening during Q2 2025 (i.e. July 2025 – September 2025).

Finally, the Company will continue to make investments in real assets and equipment to support expanding its service station businesses and network, its industrial client base, and LPG business.

For More Information CLICK HERE

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Mailpac Group Doubles Size With Acquisition Of myCart Express

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Khary Robinson and Garth Pearce of Norbrook Equity Partners Limited, Mark Gonzales and Samantha Ray of Mailpac, and Kamar Palmer and Aldane Smith of MyCart.

Mailpac Group Limited (“Mailpac Group”), Jamaica’s leader in e-commerce logistics and solutions, announced today that it agreed to acquire MyCart Express (“MyCart”), the fastest growing and second-largest courier company in Jamaica. This strategic transaction not only positions the combined entity as the largest courier platform in the Caribbean delivering over 1.5 million packages annually, but also merges the complementary management, service offerings, and geographic footprint of both entities to deliver superior growth to stakeholders.

After the closing of the transaction, the Board of Directors is expected to convene an extraordinary general meeting of the shareholders to propose that Mailpac Group be rebranded as MyPac Group (“MyPac”) which will operate several independent ecommerce solution-based brands, including Mailpac (premium-service courier), MyCart (value-focused courier), Pack Yuh Barrel (digital barrel packing and shipments), and Mailpac Local (local online shopping). While the management of each brand will remain intact, the Group will be overseen by a management committee made up of Khary Robinson and Garth Pearce of Norbrook Equity Partners Limited (“Norbrook”), Mark Gonzales and Samantha Ray of Mailpac, and Kamar Palmer and Aldane Smith of MyCart.

In addition to doubling the size and capacity of Mailpac Group, the transaction will see the owner operators of MyCart becoming shareholders of the publicly listed company, significantly adding to the innovation and execution capacity of the Group.

“After my first meeting with Aldane and Kamar, I knew they would be excellent partners in this journey of building the region’s leader in ecommerce solutions. Their innate ability to read the market, innovate solutions, and execute, is a perfect match to our proven capacity to deliver operational excellence in growing companies.”

The result of this combination of minds and resources will be revolutionary for consumers and shareholders,” said Khary Robinson, Executive Chairman of Mailpac Group.

The transaction also provides MyCart, its ownership, and its management team with a more seamless pathway to establishing and operating the largest and most trusted courier platform in the Caribbean.

“Our model at MyCart is unique, from customer acquisition to speed of delivery and everything in between. This led to five years of explosive growth, which was great, but also requires established support and resources to avoid certain pitfalls. We believe that Norbrook will give us the right balance of growth support and risk management. With MyPac, we can now continue growing aggressively through continued innovations for consumers but benefitting from the governance and resources of being a publicly listed platform run by proven business leaders,” said Aldane Smith.

In addition to meaningful synergies in various operational areas, Mailpac and MyCart will also get to strategically focus on their core market segments with appropriate services and pricing. “For years we struggled to be everything to everyone, from premium customers wanting a personalized experience all the way to their doorstep, to value-driven customers that just want to collect their packages as fast as possible at the lowest cost. With both brands under one umbrella, Mailpac can now focus on our core differentiators and MyCart can do the same,” said Mark Gonzales, CEO of Mailpac Group.

With conservative synergy estimates, Mailpac Group expects the transaction to deliver significant enhancements in revenue and profitability. Being the market’s second largest player with eight locations and tens of thousands of customers, MyCart brings substantial commercial and economic value to the Group. More importantly, with a robust technology backbone that was created in-house and an expansive warehouse presence in Miami, MyCart is poised to propel the Group in directions and into markets untapped by Mailpac.

“The transaction marks a pivotal moment in the logistics sector, with MyPac poised to lead the way in delivering exceptional courier services across Jamaica and the Caribbean. The combined expertise, resources, and innovative approaches of Mailpac and MyCart create a formidable force that will shape the future of logistics in the region,” said Robinson.

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