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Bahama-based retailer John Bull mulls Cuban expansion.

The John Bull Group, a leading duty-free retailer in the Bahamas, says it may open a third luxury boutique in Cuba--nearly 10 years after inaugurating its first Cuban outlet in Varadero.

"Business is increasing and tourism is growing. This whole area is being developed with hotels and trade centers," said Mike Russell, the chain's foreign operations manager. "The Cuban people are making more money, so there's more money to spend."

Russell told CubaNews that "we're looking for possibilties and locations," though he added that any expansion of John Bull in Cuba would likely be limited to Havana.

John Bull, founded in 1929, now has 17 outlets throughout the Bahamas--principally in Nassau, Paradise Island, Abaco and Eleuthra. An 18th outlet is opening later this month at the Four Seasons Resort in Exuma.

The chain also has two boutiques in Cuba: one in Varadero, the other at the Galeria Comercial Comodoro, a shopping complex attached to the Hotel Comodoro in Havana's Miramar district. Both shops measure around 104 square meters.

John Bull is in Cuba thanks to a joint venture with Tiendas Universo S.A., a division of Cuban state tourism agency Cubanacan.

Universo operates the stores and provides the employees, while John Bull supplies the goods. The product portfolio includes watches by Rado, Gucci, TAG Heuer and Citizen that start at $60 and go as high as $1,500.

The stores also offer two lines of Colombian leather goods (Carib Style and III Milenio), and generic gold and silver jewelry, as well as a line of Aztec-inspired jewelry from Colombia called L.A. Cano.

Russell said John Bull's prices in Cuba are no different than in Nassau. "We couldn't have products in Cuba selling for more than in the Bahamas under the John Bull name," he said. "It would give us a bad reputation."

John Bull's Havana store, opened three years ago, is located at the intersection of Calle 84 and Tercera Avenida, in the heart of Miramar's rapidly growing business district, and only a few blocks away from the Miramar Trade Center. As such, the store attracts not only tourists but also foreign diplomats and local Cubans with access to dollars.

Russell conceded that it's difficult to work in Cuba due to the complicated government bureaucracy; the lack of incentives for sales employees doesn't help, either.

"We try to educate them as far as sales," he said delicately. "What motivates salespeople are incentives, but because of their system of government, everybody is supposed to be on an equal footing, so they don't want one person making more money than the next."

Russell, who declined to specify how much his company has invested in Cuba, said his only real competition is Coral Negro, a Cuban entity that sells watches and jewelry. But that chain sells Seikos and Swatches, and "they're not in the same ball park as us," he said.

"We do have a concession for perfume, but we found after a few years that it really wasn't worth continuing. If we had four or five outlets, maybe it would be worthwhile," he said. "We have to see how things go."

While it may not have much competition, John Bull isn't the only upscale retailer in Cuba. Italy's Benetton Group is already present in Havana and Varadero, and last November, another Italian retailer, Paul & Shark, opened an outlet in Old Havana, along Calle Muralla between San Ignacio and Mercadero.

Like John Bull's ventures, the Paul & Shark franchise--which sells men's and ladies' sportswear--is a 50-50 venture between the Cuban government and Paul & Shark's parent company, Dama SpA of Italy.

"The store is doing quite nicely," said Bob Garey, president of Paul & Shark USA in New York. "We do a global collection, and our stores are consistent throughout the world in terms of furnishing, presentation and product mix. We ship to 60 countries around the world, and now including Cuba."

Paul & Shark already has similar outlets in Miami's Bal Harbour as well as Cancun and Paradise Island in the Bahamas.
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Title Annotation:The John Bull Group
Author:Luxner, Larry
Geographic Code:5CUBA
Date:Apr 1, 2004
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