In the wake of the reopening of the sugar estates there is an opportunity for GuySuCo and NICIL to renegotiate the wages of the sugar workers and remove the need for union fees given the potential length of the labour contracts. This will quickly reposition the cost structure of the estates adding both increased profitability and increased flexibility. With such indirect restructuring and its potential benefits, the government will now have increased leverage to renegotiate existing labour contracts with the union for the estates that are currently still in operation. Thus the cost structure of the industry may be revamped to allow for increased sustainability. In addition, local customers that are dependent on the industry for key supplies such as molasses and key services such as drainage will be more accommodating of price increases, thus adding increased margin to GuySuCo’s products & services and resulting in an improvement in overall profitability of the industry.
The agony and grief that the sugar workers have gone through in recent months could have been avoided if the union and the management of GuySuCo were able to work closely together on a long term cost improvement plan. Also better negotiating, customer relationship building and a good long term pricing strategy that incorporated value pricing would have allowed for improved pricing strength for GuySuCo’s products and services. It is unfortunate that a holistic long-term view of running the industry was not undertaken by its management team. If it had been, a lot of the current turmoil in the industry could have been avoided while achieving improvement in profitability targets.