The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian drinks producer yesterday said it was aiming to go public in three years’ time to raise the capital necessary for its $15-$25 million Andros expansion and international growth plans.

Mervin Sweeting, Switcha Bahamas’ founder and owner, told Tribune Business that the company was already plotting its next growth phases as it prepares to start construction on a new 22,000 square foot production facility in Nassau before year-end.

With $3 million in financing raised via a KPMG-assisted equity placement to propel its immediate expansion, Mr Sweeting said the Airport Industrial Park-based company was looking to hire 30-50 more staff once its new plant was completed.

Mr Sweeting said the new plant would increase production volumes by “about 50 times’ the amount of product we move now”.

And Switcha, which currently has three drinks lines, is not confining its ambitions to the Bahamas. Mr Sweeting said the company had already begun the process of registering its trademark in the US, and was already speaking to potential franchisees in the Bahamas’ northern neighbour.

Similar opportunities are also being eyed in the Caribbean, and Mr Sweeting revealed that Switcha planned to ultimately construct a new manufacturing and processing facility in Andros once its purchase of a grapefruit farm closed in early 2015.

Recalling Switcha’s progress from humble origins, Mr Sweeting disclosed how the Bahamas Development Bank (BDB) turned him down for financing in 2009, branding his project ‘non-viable’.

“I still have my letter from the Development Bank in 2009, when they told me my project wasn’t viable,” he revealed.

“In the beginning it was discouraging, but I took that discouragement and made it work. Now I sit on the same technical panels as the BDB that told me the project was not viable and we can’t help you.”

The BDB’s financing denial came at a potentially critical time for Switcha, as it sought to obtain the capital necessary to transition from sole entrepreneur/dream into a small business with physical presence.

“The company started in 2007,” Mr Sweeting said. “I started it in my kitchen, and went on to the East-West Highway where I stayed for two years, selling product on the side of the road.”

Attributing his and Switcha’s success to “persistence and hard work”, Mr Sweeting said the KPMG-arranged placement had generated the financing necessary for the new 22,000 square foot plant and its equipment.

“We were actually looking to put on another 30-50 staff when the new facility is completed,” he told Tribune Business, boosting the existing 11-strong workforce to between 40-60.

The new production plant, which is expected to take between six-nine months to construct, and be operational by either mid-2015 or the third quarter, will transform Switcha’s processes from manual to automated.

And, once this project is complete, the company’s focus will likely turn to Andros once its grapefruit farm purchase is complete. Mr Sweeting indicated this facility would provide the company with its homegrown raw materials, such as lime, as well as new manufacturing and processing facilities.

“We also have the opportunity to export our product,” Mr Sweeting told Tribune Business. “Unlike the likes of Caribbean Bottling, we have the ability to sell in all markets.

“The company is based in the Bahamas, but we can franchise it out in Turks & Caicos, and sell it in the US due to the word of mouth from anyone who tries it.”

“We are actively doing it now,” Mr Sweeting said of Switcha’s international ambitions. “We have made the application to register the trademark in the US. Our company, unlike any other, has the opportunity to become a conglomerate.

“I’ve spoken to various companies in the US, willing to produce and distribute the product in the US. It’s a medium to long-term goal, but we’ve already started.”

Ultimately, to finance such ambitions, Mr Sweeting indicated that Switcha would be willing to seek capital from the Bahamian public via an initial public offering (IPO) to retail and institutional investors.

“We’ll probably take the company public in three years to raise the necessary capital to franchise it out and grow it on a regional and global scale,” Mr Sweeting told Tribune Business.

“The potential is there, the product is there. We’re going to make it happen. We’re going to show the Bahamas and the world that we can perform on a global scale, and we have the products to do it.”