WHITEFISH, MT / June 5, 2014 / Blue Water Global Group, Inc. (OTC: BLUU) is employing a dual
approach to capture significant market share in the Caribbean casual
dining restaurant and rum markets, while also leveraging sizeable, early
equity positions in exciting private companies that are interested in
going public.Blue Water Bar & Grill(TM)
Blue Water Bar & Grill(TM), a Caribbean theme-based restaurant
brand, is designed to cater to the largest segment of global cruise
passengers: North American tourists. The planned growth of the company’s
restaurant division is mapped out physically along all the major ports
of callfor the big cruise lines spread throughout the Caribbean region.
This expansion plan has the ability to piggyback off success in the
steadily growing cruise industry to great effect.
With 13 new ships entering the global cruise industry last year and
another 15 planned for 2014, passenger volume is projected to be up by
2% this year. This industry growth continues to be led by the dominant
Caribbean region, which accounted for 34.4% of global passengers in
2013. These trends combine to make BLUU’s strategy look not only
superbly conceived, but well timed to boot.
With the typical ship dropping over 2,500 passengers and around 500
crew members, conservatively generating some $226k in expenditures
during a single visit, the concept of the Blue Water Bar & Grill
addresses a target-saturated environment. Reliably good food from
location to location, served in a manner which feels familiar yet has
the flavor of the Caribbean thematically evoked, should be a winning
venue strategy for these tourists.
The company’s initial location on the Caribbean island of St.
Maarten, Dutch West Indies, currently sees in-season daily vessel counts
as high as 8 to 10, dropping off some 30,000 to 35,000 people in a
single afternoon. St. Maarten is a duty-free shopping Mecca with
numerous pristine beaches and attractions, meaning big traffic volumes
that make BLUU’s appropriately themed casual dining experience, which
readily appeals to North American tourists, a big potential driver.
Development of the Blue Water Bar & Grill in St. Maarten is
progressing nicely, with an update report issued in late May of 2014
that indicates permitting applications are going in and the final
drawings/renderings of the architectural design should be out shortly.
Photos of the largely negotiated beachfront area will also be going live
on the company’s website and Facebook page soon as well.
With roughly 1.79M cruise passengers having come to the Port of St.
Maarten in 2013 (631 vessel calls) according to the port’s own data, the
volume of tourists was up 1.85% over the record set in 2012 and 2014 is
set to keep pace with this performance, especially as the port
celebrates its 50th anniversary. St. Maarten can even handle the Oasis
Class, Royal Caribbean Cruises Ltd. (NYSE: RCL) ships, which are the
world’s biggest passenger vessels, with around 5,400 passengers per ship
at capacity and nearly 2,400 crew members.
The planned roll out of restaurants calls for a new location about
once per year, with growth tailored to each new port of call. Additional
primary targets for new locations currently on the horizon include
Aruba, Barbados, Cozumel, Grand Cayman, and Nassau. Management
anticipates that if they can get a location established in each of these
primary targets, the restaurant division will become a very attractive
take-over target. Key location parameters for new locations include
proximity to the primary point of entry, as well as to hotels and other
accommodations, with beachfront and waterfront being seen as critical
factors when it comes to a given location’s success. High overall
traffic density is also important when choosing locations, given the
capacity of locals to sustain the business year round and during the
periodic lulls in tourism.
The Caribbean casual dining market is largely dominated by either
high-end gourmet restaurants or un-themed mom and pop type operations
which lack food quality, menu, and service consistency, and which are
typically focused on gouging tourists with high prices. Very little
emphasis from the mom and pop operations is placed on generating repeat
business or building a brand, making the market particularly ripe for
the pickings to a coordinated, themed approach like the one BLUU has put
together. A majority of Caribbean tourists come from Canada or the U.S.
where the market is already saturated with branded franchise and themed
restaurants, like the Pollo Tropical brand of fast casual restaurants,
which serve a range of tropical and Caribbean inspired foods, by Fiesta
Restaurant Group, Inc. (NASDAQ: FRGI), and sector giant, Darden
Restaurants, Inc. (NYSE:DRI), who is best known for their Olive Garden
and Red Lobster brands, but also has a nice Caribbean vector going with
their Bahama Breeze restaurants.
Blue Water Distilled Spirits
A significant, secondary stream of revenue from Blue Water’s
restaurant segment will likely be derived from Blue Water Bar &
Grill-branded memorabilia, like beach towels, t-shirts and other items,
using a merchandising model similar to that of Hard Rock Cafe
International, Inc., which actually makes most of their money off this
branded merchandise stream. The company’s brand merchandising strategy
is even giving birth to a product series instantly recognized on its own
as a classic piece of Caribbean memorabilia, rum, a product that is
also ideally suited to the company’s target market. BLUU’s first planned
offering in this product series, Blue Water Ultra Premium Rum™
(to be followed shortly thereafter by smooth spiced and seasonal
holiday spiced versions), is a high-end white rum designed for smooth
Plans are to eventually ramp into the North American premium spirits
market following successful localized distribution, and Nassau is
already established as a choice interim target. The distilled spirits
market is huge, with players like Diageo plc’s (NYSE: DEO) Captain
Morgan brand of rum standing out as an obvious analog. The sky is the
limit for Blue Water Ultra Premium Rum in the global market long-term.
Public Company Equity
The third division of BLUU’s architecture covers investment in
private companies who are looking to list stock on the public markets.
President and CEO of Blue Water Global Group, J. Scott Sitra, has a
background in securities law that stretches back to 1987 and his
extensive history handling the nuanced process of taking companies
public, from SEC filings and registration statements to ensuring
FINRA/SEC compliance, is a huge boon for this division. Sitra’s
expertise in this area is also instrumental in his role over at Taurus
Financial Partners, LLC, which Sitra founded in 2010 and where he is
also currently President and CEO.
Through a strategic alliance agreement with Taurus, Blue Water Global
Group is able to participate in prospective companies that are
preparing to go public while they are still in the very early stages,
with BLUU getting a nice block of stock in exchange for covering the
procedure costs. A percentage of the large equity position thusly
obtained by Blue Water is held for the company’s account, with the
remainder shared to stockholders as a special stock dividend for being
loyal. This relationship with Taurus grants the company the capacity to
head-hunt private companies for some nice upside which can also be
liquidated at a future date in order to accelerate growth in the
company’s other divisions, while also satisfying an investor retention
role. The company has completed one such investment, and is closing in on a second deal soon.
Blue Water Global Group’s restaurant, distilled spirits and
investment divisions form a stable foundation that has potentially
consistent revenue generation on the one hand with their highly targeted
restaurants and rum, as well as dynamic growth prospects on the other
via participation in early-stage companies and registered future
spin-offs. The best of both worlds really, with a large and growing
target market underwritten by the booming cruise industry in the
Caribbean, and genuinely exciting potential equity investment upside
that can be readily converted into additional momentum for the core
business. Investors may want to keep an eye on Blue Water as the company
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SOURCE: Emerging Growth LLC