Voluntary Report - public distribution

**Date:** 8/16/2004

**GAIN Report Number:** C14016

C14016

**Caribbean Basin**

**Market Development Reports**

**British Virgin Islands Yacht Provision**

**2004**

**Approved by:**

![](media/image1.wmf)Paul Hoffman, Director

Caribbean Basin ATO

**Prepared by:**

Nicole Smith, Agricultural Marketing Assistant

**Report Highlights:**

The nearly forty islands, rocks, and cays of the British Virgin Islands,
along with easily navigable waters, white sandy beaches, warm trade
winds, and laid back culture, have encouraged the growth of sailing in
the BVI. The country is world renowned for its yachting industry, and
has been dubbed the \"Sailing Capital of the Caribbean.\" Since 1997,
visitors arriving in the BVI by boat, not including cruise ship
passengers, have outnumbered those arriving by air. As the number of
yacht vacationers continues to increase yearly, the market for yacht
provisioning also grows.

Includes PSD Changes: No

Includes Trade Matrix: No

Unscheduled Report

Miami \[C11\]

\[C1\]

Section I. Market Summary

Country Snapshot

The British Virgin Islands (BVI), part of the Leeward Island chain, are
located in the Caribbean Sea about 50 miles east of Puerto Rico. Known
as "Nature's Little Secret," 16 inhabited and more than 20 uninhabited
islands consist largely of rolling green hills and white sandy beaches
and have a total area of 59 square miles. The total population is around
21,730 (2003 est.). The capital of BVI, Road Town, is located on the
island of Tortola, which lies just 8 miles east of St. Thomas in the
U.S. Virgin Islands. Tortola is the largest island at 21 square miles,
and serves as the center for commerce and government. Apart from
Tortola, the main inhabited islands of the BVI are Virgin Gorda at 8
square miles, Anegada at 15 square miles and Jost Van Dyke with 3.4
square miles. BVI also consists of a number of privately owned islands,
several of which serve as vacation resorts.

Each of the islands can be easily accessed from one another, and from
the U.S. Virgin Islands, by inter-island flights, small boats, and
regular ferry service. The islands have several ports, including Port
Purcell and West End in Tortola, St. Thomas Bay in Virgin Gorda and
Great Harbor in Jost Van Dyke. No direct flights are available to the
islands from the mainland United States, Europe, or South America, yet
inter-island flights are accessible from the three airports located on
the islands. The largest airport, the Terrence B. Lettsome Airport, is
located on Beef Island, situated on the east end of Tortola. At this
airport, several airlines offer flights to San Juan, Puerto Rico, St.
Thomas, U.S. Virgin Islands, and a number of other Caribbean
destinations. Two smaller airports, located on Virgin Gorda and Anegada,
offer flights to the Beef Island airport as well as charter flights to
other points throughout the Caribbean.

The BVI has long been a British Dependent Territory, and remains so
today. The United Kingdom governs over a significant portion of the
islands, including the territory's external affairs, defense, internal
security, and the administration of the courts. A governor, appointed by
the British crown, controls these areas of responsibility. The territory
does have some autonomy, as it is responsible for its own internal
self-government and is governed by a democratically elected Parliament
and Cabinet. BVI is an associate member of both the Organization of
Eastern Caribbean States (OECS) and the Caribbean Community and Common
Market (CARICOM). Membership in these organizations ease trade between
member Caribbean nations by offering duty-free access, facilitating
bilateral and multilateral co-operation, and allowing goods, services,
people and capital to move throughout the Caribbean nation members
without tariffs and restrictions.

Despite its political ties to the United Kingdom, the BVI has been
closely related to the U.S. economy for many years. Proximity has also
resulted in the creation of very close economic and cultural ties to
both Puerto Rico and the U.S. Virgin Islands. The U.S. dollar serves as
the currency in BVI.

The BVI Yacht Industry

Like most Caribbean islands, tourism is a large part of the BVI economy.
The tourism industry plays a key role in the BVI, accounting for 45% of
the local economy in 2002 and employing roughly one quarter of all BVI
residents. Yet BVI tourism is unique compared to other Caribbean
destinations because of the number of tourists that arrive and vacation
on yachts. From 1997-2001, visitors arriving in the BVI by boat, not
including cruise ship passengers, outnumbered those arriving by air.
This trend has continued, and the number of yacht vacationers to the BVI
increases yearly. The nearly forty islands, rocks, and cays of the BVI,
along with easily navigable waters, white sandy beaches, warm trade
winds, and laid back culture, have encouraged the growth of sailing in
the BVI. The country is world renowned for its yachting industry, and
has been dubbed the "Sailing Capital of the Caribbean."

![](media/image2.wmf)

Source: Caribbean Cellars 2004 Product Expo

![](media/image3.wmf)Yacht vacationers arrive in the BVI from almost
every corner of the world, yet U.S. tourists overwhelmingly represent
the majority of visitors to the islands. Because of the close economic
ties to the U.S., the number of overall tourists decreased with the 2002
U.S. economic slump caused after the events of 9/11, but has since been
increasing steadily. A strong market exists among tourists for U.S. food
products, as most American tourists prefer U.S. food products. Besides
the U.S., visitors to the BVI also come from Europe and other Caribbean
nations, including the U.S. Virgin Islands and Puerto Rico.

Source: Caribbean Cellars 2004 Product Expo

The high season for the yachting industry is the same as for the tourism
high season, November-March. Yacht vacationers and other tourists are
lower in number during the hurricane season, which lasts from
June-November.

Overall tourist arrivals in the BVI are not evenly distributed among the
islands. Tortola has three areas of entry for visitors, Beef Island
Airport, Road Town, and West End, and this island receives a clear
majority of visitor arrivals, 436,433 in 2001. Virgin Gorda and Jost Van
Dyke also attract a number of visitors, 59,706 and 38,580 in 2001,
respectively. Tourism to the smaller islands differs by island; for
example, Anegada received 492 visitors in 2001. Visitors that arrive by
boat also vary from island to island, and with the exception of the
three largest islands, which each have airports, almost all of the
islands of the BVI are accessible only via boat.

The typical yachting group may consist of family and/or non-family
members, and can vary in number of individuals from two to twenty
depending on the size of the yacht. While the U.S. Virgin Islands tend
to attract more of the "mega yachts" that house larger groups, the BVI
yachting industry is made up of and attracts the smaller yachts. The
typical yacht vacation is estimated to last between seven and ten days,
and most trips will stay within the waters of the BVI rather than
traveling to nearby islands.

Many boat owners store their yachts year round in the BVI, while others
keep their yachts in the islands only during the peak yachting season.
During the low season, these boats may be brought to the Mediterranean
to be used, or many are used along the U.S. East coast, mainly in the
north out of the main hurricane belt. If the boats are stored year round
in the BVI, the owner has several choices of marinas at which to store
the yacht.

BVI Marinas

+--------------------------------+----------------------+--------------+
| ######### Name                 | ######### Location   | **No. of     |
|                                |                      | Ships**      |
+--------------------------------+----------------------+--------------+
| Village Cay Marina             | Tortola              | 105          |
+--------------------------------+----------------------+--------------+
| The Moorings Marina            | Tortola              | 130          |
+--------------------------------+----------------------+--------------+
| Soper's Hole Marina            | Tortola              | 60           |
+--------------------------------+----------------------+--------------+
| Nanny Cay Marina & Resort      | Tortola              | 200          |
+--------------------------------+----------------------+--------------+
| The Bitter End Yacht Club      | Virgin Gorda         | 25           |
+--------------------------------+----------------------+--------------+
| Virgin Gorda Yacht Harbor      | Virgin Gorda         | 110          |
+--------------------------------+----------------------+--------------+
| Leverick Bay Marina & Resort   | Virgin Gorda         | 30           |
+--------------------------------+----------------------+--------------+
| Peter Island Yacht Harbor &    | Peter Island         | 10           |
| Resort                         |                      |              |
+--------------------------------+----------------------+--------------+

Yachting vacationers in the BVI have many islands and cays available to
visit. Listed above are the largest marinas in the islands, which are
located in the largest islands. Smaller ports, docks, and marinas are
located throughout the smaller islands as well.

Upon arrival in the BVI, tourists have a number of accommodation options
available. Most of the large marinas have a hotel or resort close by for
visitors who would like to spend a night ashore, although most visitors
arriving on the island via yachts tend to rely solely on the yachts as
their source of accommodations during their vacations rather than
spending nights off the boat. In 2001, the number of visitors staying on
chartered boats outnumbered the amount of visitors staying in hotels and
visitors staying in rented/owned accommodations combined.

![](media/image4.wmf)

Source: FAS' Global Agricultural Trade System using data from the United
Nations Statistical Office

As charter vacationers are relying solely on the boats for
accommodations, this means that many meals are also prepared on board.
The amount of meals eaten on board usually depends on the type of crew
aboard the yacht. Some boaters own their yacht and sail it themselves,
without hiring a crew. These tourists either prepare food themselves
aboard the boat or dine at restaurants in the BVI, many of which are
also located at or near the marinas. Others visitors may charter a boat,
yet still not hire a crew and instead elect to sail on their own. This
type of charter is called a "bareboat" charter, because the person is
renting the "bare" boat without a crew. Still others may charter a
crewed yacht, which includes a captain to sail the boat. Crewed yachts
may also include hiring a chef who sails with the boat and prepares all
meals for the guests on board. Regardless of whether the yacht is crewed
or bare, there is always a need for some amount of food upon the boat.

Market Overview

Food and beverage companies have recognized the growth of the yachting
industry and have geared their efforts towards provisioning for these
chartered boats. Companies whose sole business is provisioning are
beginning to pop up on the island, and retailers and wholesalers are now
also marketing their services to the yacht vacationer. These
provisioning-specific companies are mainly located on the larger
islands. Many of the marinas also have small retail shops or delis where
yachtees can stop by and pick up provisions.

Provisioners generally attract new customers by advertising via their
company website, which is enables them to reach customers throughout the
world. Some provisioners advertise in U.S. and other publications, such
as marine guides, in order to reach the major tourist audience.
Customers chartering boats through a BVI company usually receive a
provisioning form along with their charter contract, and this is another
method for provisioning advertisements. Many retail outlets are
advertised through the specific provisioning company or yacht chartering
company that use their services. Provisioners may also provide brochures
or posters at the marina to attract yachting customers. Most
provisioning companies will deliver the orders to the customer, although
some may charge a small fee for this service. Customers can order in
advance or in person at most locations, and can pay via cash or credit
card.

Due to the increasing importance of yacht customers, wholesalers and
importers purchase food products not only for distribution to the food
service sector, but increasing amounts for their retail customers and
yacht provisioning shops. As the U.S. supplies the majority of the BVI
food and beverage industry, the same is true for the foodstuffs used for
provisioning purposes on the island.

+-----------------------------------+----------------------------------+
| **Advantages**                    | **Challenges**                   |
+-----------------------------------+----------------------------------+
| U.S. tourists represent 78        | Importers usually purchase food  |
| percent of total tourists         | products in small volumes.       |
| visiting the BVI.                 |                                  |
+-----------------------------------+----------------------------------+
| BVI has been importing most of    | Significant changes exist        |
| its food needs due to the small   | between high and low tourist     |
| local agricultural sector.        | seasons.                         |
+-----------------------------------+----------------------------------+
| The United States leads the food  | Foodstuffs used for provisioning |
| and beverage market.              | must fit within available        |
|                                   | storage facilities on boat.      |
+-----------------------------------+----------------------------------+
| U.S. tourists often desire U.S.   | ###                              |
| food products.                    |                                  |
+-----------------------------------+----------------------------------+

Section II. Road Map for Market Entry

A.  Entry Strategy

The yacht provisioning sector in the BVI obtains the majority of its
food and beverages from local wholesalers-importers and retailers. The
main wholesale companies in the BVI are located in Tortola, and several
of these companies have offices and retail outlets in Virgin Gorda. The
smaller islands get their food products, usually by ferry, from one of
the two larger islands. Because of small volumes, the best way for the
yacht provisioning sector to obtain imported food products is through a
local importer, as these companies usually wholesale and also
distribute. The wholesalers and importers supply the yacht provisioning
retail shops, including supermarkets, grocery stores, and specialty
stores.

It is common for local importers and retailers to run out of certain
food products. For this reason, a small but increasing number of
retailers, including specialty provisioning shops, are importing from
wholesalers in the U.S. Virgin Islands, which are becoming a key
supplier of the BVI market. These wholesalers are able to provide the
high quality U.S. products desired, with low cost shipping methods, and
can often provide the smaller quantities required in the BVI.

To successfully enter the BVI provisioning sector, U.S. exporters should
contact the company directly. Usually, if the provisioning company is
interested in the product, they will request product literature and
samples. Afterwards, they will likely ask the supplier to work through
their food importer or distributor, whether local or through the
U.S.V.I., as quantities desired are often too low to permit direct
importation.

B.  Market Structure

Local importers, who import the majority of the sector's food needs from
the U.S., represent a large portion of the food distribution to the BVI
yacht provisioning sector. Supermarkets and smaller retail outlets are
also receiving product from these importers and supplying yacht
provisioners, as well as provisioning themselves. Wholesalers in the
U.S. Virgin Islands are becoming more frequently used and are
significant competition for the local wholesalers.

*Product Flows for Imported Products:*

####### 

C.  Sub-Sector Profiles: Provisioning Companies in the BVI

+-----------------+---------+--------------------+--------------------+
| ######### Name  | ####    | **Type**           | ########           |
|                 | ##### L |                    | # Purchasing Agent |
|                 | ocation |                    |                    |
+-----------------+---------+--------------------+--------------------+
| Bobby's         | Tortola | Supermarket        | Local Wholesaler   |
| Supermarkets    |         |                    |                    |
|                 |         |                    | & Direct Importer  |
+-----------------+---------+--------------------+--------------------+
| Rite Way        | Tortola | Supermarket        | Local Wholesaler   |
|                 |         |                    |                    |
|                 |         |                    | & Direct Importer  |
+-----------------+---------+--------------------+--------------------+
| K-Mark's        | Tortola | Supermarket        | Local Wholesaler   |
|                 |         |                    |                    |
|                 |         |                    | & Direct Importer  |
+-----------------+---------+--------------------+--------------------+
| Gourmet         | Tortola | Grocery Store      | Local Wholesaler   |
| Chandler        |         |                    |                    |
|                 |         |                    | & Direct Importer  |
+-----------------+---------+--------------------+--------------------+
| Tico's          | Tortola | Specialty Store    | Local/U.S.V.I.     |
|                 |         | (Beverages)        | Wholesaler,        |
|                 |         |                    |                    |
|                 |         |                    | & Direct Importer  |
+-----------------+---------+--------------------+--------------------+
| Ms. Penguins    | Tortola | Specialty Store    | Local Retail       |
|                 |         |                    | Outlets/           |
|                 |         | (Individual Frozen |                    |
|                 |         | Meals)             | U.S.V.I.           |
|                 |         |                    | Wholesaler         |
+-----------------+---------+--------------------+--------------------+
| Caribbean       | Tortola | Specialty Store    | Local, U.S.V.I     |
| Cellars         |         | (Beverages)        | Wholesaler         |
|                 |         |                    |                    |
|                 |         |                    | & Direct Importer  |
+-----------------+---------+--------------------+--------------------+
| BVI Yacht       | Tortola | Charter Company    | Local Retail       |
| Charters        |         |                    |                    |
+-----------------+---------+--------------------+--------------------+
| The Moorings    | Tortola | Charter Company    | Local Retail       |
+-----------------+---------+--------------------+--------------------+

The above list constitutes a sample of the main provisioners in Tortola.
Many of the provisioners listed are large retail outlets or specialty
stores, which have begun to recently focus more towards the yacht
provisioning market. It should be noted that the majority of all
foodstuffs used in provisioning are U.S. products, whether directly
imported, received through a local wholesaler/distributor or a
wholesaler/distributor in the U.S.V.I., or bought via a retail outlet in
the BVI.

### Section III. Competition

Competition for food and beverage products in the yacht provisioning
industry is identical to the competition for the main food and beverage
market in the BVI. Competition is led by the United States who supplies
most of the nation's total needs. The high quality and competitive
prices of U.S. food products, along with the United States proximity to
the BVI, the nation's close ties to the neighboring U.S. Virgin Islands
and Puerto Rico, and the longstanding economic ties to the United States
all contribute to the success of U.S. products.

The following products and countries compete with U.S. products:

-   **Beef:** Argentina, France (via St. Martin)

-   **Pork:** Brazil

-   **Fresh Produce:** St. Vincent & The Grenadines

-   **Seafood:** Local producers

-   **Dairy Products:** France (via St. Martin)

-   **Alcoholic Beverages:** France, Australia, Chile

-   **Non-Alcoholic Beverages:** Canada, Trinidad and Tobago, Dominica

-   **Bottled Water:** Scotland, UK, local producers

-   **Bakery Ingredients:** Canada, UK

The product competition with other nations varies among categories. The
United States dominates the market in the categories shown in the
following table. U.S. food products comprise more than eighty percent of
the market share for fresh/chilled/frozen red meats, poultry meats,
sugars/sweeteners/beverage bases, fresh vegetables, fruit & vegetable
juices, and vegetable oils.

+--------------------------+-------+---------------------------+------+
| ## Top 10                |       |                           |      |
| U.S. Food Products in BV |       |                           |      |
| I Import Market for 2003 |       |                           |      |
+--------------------------+-------+---------------------------+------+
| **U.S. High Value Food   | **M   | **U.S. High Value Food    | **Ma |
| Product**                | arket | Product**                 | rket |
|                          | Sh    |                           | Sha  |
|                          | are** |                           | re** |
+--------------------------+-------+---------------------------+------+
| Red Meats                | 100%  | Vegetable Oils            | 80%  |
| (Fresh/Chilled/Frozen)   |       |                           |      |
+--------------------------+-------+---------------------------+------+
| Poultry Meats            | 100%  | Wine and Beer             | 46%  |
+--------------------------+-------+---------------------------+------+
| Sugars, Sweeteners, &    | 100%  | Rice                      | 37%  |
| Beverage Bases           |       |                           |      |
+--------------------------+-------+---------------------------+------+
| Fresh Vegetables         | 99%   | Red Meats                 | 21%  |
|                          |       | (Prepared/Preserved)      |      |
+--------------------------+-------+---------------------------+------+
| Fruit & Vegetable Juices | 92%   | Snack Foods (Excl. Nuts)  | 15%  |
+--------------------------+-------+---------------------------+------+

###### Source: UN Trade Data

**Section IV. Best Prospects**

Products used for provisioning must be small in size, as they must fit
within storage facilities available on the boats. Another factor that
must be taken into consideration is that most yachting trips last
several days, and customers usually seek products that will not spoil
during the trip. With the wide availability of retail shops at marinas,
however, customers are able to shop daily or as needed. Products that
have good sales potential within the provisioning sector are alcoholic
beverages and snack foods, although all food products are used for
provisioning and have good sales potential on the islands.

**Section V. Contact Information**

A. For more information on the British Virgin Islands and a list of
importers for your U.S. product, please contact:

**Caribbean Basin Agricultural Trade Office**

**Foreign Agricultural Service**

**United States Department of Agriculture**

909 SE 1^st^ Ave., Suite 720

Miami, FL 33131

Phone: (305) 536-5300

Fax: (305) 536-7577

E-mail: <cbato@cbato.net>

Paul Hoffman, Director

E-mail: <cbato@cbato.net>

Omar González, Deputy Director

E-mail: <omar@cbato.net>

Graciella Juelle, Marketing Assistant

E-mail: <grace@cbato.net>

Please visit our website for more reports and information on the British
Virgin Islands and other Caribbean Islands:

[http://www.cbato.fas.usda.gov](http://www.cbato.fas.usda.gov/), click
on "U.S. Exporters"

D.  **Other Sources of Information on The British Virgin Islands:**

BVI Chamber of Commerce and Hotel Association

PO Box 376, Road Town\
James Frett Building\
Tortola, British Virgin Islands

Tel: (284) 494-3514\
Fax: (284) 494-6179

BVI Customs Department

Tel: (284) 494-3475

BVI Ports Authority\
Port Purcell\
P.O Box 4, Road Town\
Tortola, British Virgin Islands\
Tel: (284) 494-3435

Fax: (284) 494-2642

BVI Tourist Board

Caribbean Office

P.O. Box 134

Road Town, Tortola, BVI

Tel: 284-494-3134

Fax: 284-494-3866

Email: <bvitor@bvitouristboard.com>

Department of Agriculture

Paraquita Bay

Road Town, Tortola

British Virgin Islands

Tel: (284) 495-2532

Fax: (284) 495-1269

Department of Information and Public Relations\
Government Central Administration Building\
33 Admin Drive\
Road Town, Tortola\
British Virgin Islands

Tel: (284) 468-3701, ex. 2139\
Fax: (284) 494-6877\
Email: <gis@bvigovernment.org>

Development Planning Unit\
BVI Government\
Central Administration Complex\
Wickhams Cay 1\
Road Town, Tortola\
British Virgin Islands

Office of the Comptroller of Customs

Road Town, Tortola

British Virgin Islands

Tel: (284) 494-3475

Fax: (284) 494-6906

Contact: Mr. V. Hodge

Trade and Investment

Central Administration Complex, West Wing, 1st Floor

Tel: (284) 494-3701 ext. 2008\
Fax: (284) 494 5676\
Email: <trade@bvigovernment.org>