By Karen E. Thuermer, AJOTAmerican Hotel Register Co., the world’s largest supplier to the hotel industry, offers a good example of a company that exports to and supplies Caribbean nations like Puerto Rico with much needed goods.
While the tourist industry plays a lesser role here than at other Caribbean nations, companies like American Hotel Register do a good business in Puerto Rico and are charged with getting the best price for goods for its customers. Most are major hotel chains. Consequently, the company sources worldwide for its products.
Those products range from cleaning products, uniforms, bed linens, towels, small appliance and more. They are sourced as far away as China and as near as counties with close Caribbean access like Colombia.
“Although the Caribbean market is used to paying high prices for goods (everything shipped to the islands is imported), we have found that if we can cut time involved in the supply chain, we can introduce lower priced items,” says Steven E. Wiechert, director of Global Sourcing for American Hotel Register Co. in Vernon Hills, IL.
American Hotel Register Company sells more than 37,000 products and services to the hospitality industry, such as medicinals and personal care accessories; bed, bath, and table linens, including baby products, bath rugs, bedding basics, bedspreads, blankets, mattresses and accessories, pillows, robes and slippers, sheets, shower curtains and hooks, and towels; and guest room supplies, such as bathroom and bedroom furnishing kits, snacks and beverages, coffeemaker replacement parts, coffeemakers, extended stay kitchen packs, guest room safes, hair dryers, hangers and coat racks, irons and ironing accessories, luggage racks, and room accessories.
This is good news to carriers operating in the Caribbean market and to Puerto Rico especially since it is one of the most dynamic and wealthiest economies in the Caribbean region.
A Dynamic Market
While Puerto Rico has long been typecast as a jumping off point for cruise ships offering exotic voyages in the Caribbean sun, this autonomous Commonwealth of the United States is well developed in key industries such as pharmaceuticals and biotechnology, medical device manufacturing, and the electrical/electronics industries.
Imported commodities include: chemicals, machinery and equipment, clothing, food, fish, petroleum products with some 55.0 percent going to the United States, 23.7 percent to Ireland, and 5.4 percent to Japan.
According to Zepol Corp., the top 10 product Puerto Rico imports from the United States in terms of value are toiletries and cosmetics, TVs and VCR’s, industrial engines, industrial supplies, pulp and paper machinery, alcoholic beverages (excluding wine), chemicals (organic), pharmaceutical preparations, jewelry and returned and re-imported goods.
Top export commodities in terms of value include: chemicals, electronics, apparel, canned tuna, rum, beverage concentrates, and medical equipment.
According to government statistics nearly 85 percent of Puerto Rico’s exports go to the United States. The Dominican Republic makes up its second largest export market with only some 2 percent going there.
Not surprising, Zepol reports that the top products Puerto Rico exports to the United States are pharmaceutical preparations, chemicals (organic), other household goods, computer accessories, medicinal equipment, chemicals, precious metals, electric apparatus, petroleum products, and fuel oil.
Helping to boost Puerto Rico exports and encourage investment in the Commonwealth is Section 30A of the tax code, which allows companies to claim 60 percent of wages and capital investment as allowances against tax. New firms may opt to incorporate themselves in Puerto Rico as “controlled foreign corporations” and receive the tax benefits provided by Section 901 of the U.S. Internal Revenue Code.
Puerto Rico is one of the fastest growing venture desti