Reporter's pen: the past, present and future of China's paint market

As people pay attention to environmental protection, more and more companies are playing environmental protection cards.

Increasing marketing efforts is one of the ways for companies to open up the market.

Many large companies have accelerated the research and development of water-based coatings.

"Many people are optimistic about China's coatings market.
Some products have low technical content, so a group of small workshops have also joined in, with low quality and low prices, and even more start to pour water into the coatings.
For example, CCTV and other news The Hebei paint production and processing plant exposed by the media, in pursuit of low cost and high profit, directly adds tap water to the paint.
The maximum water content can be increased to 50%, and only 3 yuan can produce 1 kg of paint.
" The person pointed out.

"Many unknown brands are still oil-based paints under the name of water-based paints.
" Insiders said frankly that this kind of water-added paint is actually a water-in-oil production technology, which is very immature.
In the summer high temperature season, the paint is easy to volatilize and crack at high temperature, and it cannot contain water, which causes water separation during transportation and storage in the warehouse.
In winter, the low temperature causes water to break through the oil and freezes.
It can only keep the freshness for more than ten days, and the color fades and falls off after more than ten days.

Wen Junyi, the general distributor of Chenhong Paint in Dongguang County, Hebei Province, pointed out that this kind of opportunistic practice is undoubtedly equivalent to pouring water into pork when a butcher kills a pig, which is an immoral behavior.
At the beginning, the paint company concealed it from the distributors, and its purpose was to maximize profits.
The more water added to the paint, the higher its profits.

“It can be said that some brands of coating companies would not expect to add water to their products.
” Zhang Fengzhi, manager of Yongchang Hardware Paint Tools Store in Wuqiao County, Hebei, told reporters that adding water reduces the price of coatings, but quality and price are two important factors for market success.
, One is indispensable, if this continues, the market and users will be destined to be lost.

Raise prices and lower prices, the market is in a cruel dilemma

"Every time the price of crude oil rises, the price of paint also increases.
However, when the price of crude oil continued to decline last year, the price of paint did not decrease.
This is difficult to understand.
" Li Jianjun, a salesperson at Anling Hardware Paint Store, told reporters.
.
Many paint distributors have the same doubts.

Participating in the exhibition is an important method for companies to attract users and distributors.
The picture shows Carbo-Li's booth at the exhibition.

Dai Maozhen believes that more than a dozen consecutive declines in oil prices have led to a 40% drop in 200# solvent oil, which is the largest used in paint production, and a 20% drop in other raw materials.
The profits of paint companies should have gone up.
At this time, the water-based coating strategy that emerged in the industry has made companies claim that R&D costs are high, so price cuts have become futile.
Then this year, a 4% consumption tax was levied on paints with a VOC content of more than 420 g/L under construction, making price cuts a luxury for dealers.

"However, for the profitability of coating companies and the downward trend in market sales, there is still a strong atmosphere for acetic acid coatings to reduce prices, but for furniture coatings that are not profitable, there is an intention to increase prices.
" Dai Maozhen said.

Dai Maozhen analyzed that not long ago, the news that a 4% consumption tax was levied on coatings with a VOC content of more than 420 g/l in the construction state, furniture coating companies with only 5% to 10% net profit revealed that they were overwhelmed and planned to increase prices by 4%.
, If the price is not raised directly, it will also increase the price curve.

This is the case for Carpoli.
Zhou Shaohui, executive vice president of the furniture paint division of the company, and Zhang Jianfei, director of the Huilong furniture paint department, both stated at the Dongguan Famous Furniture Fair that the price of Garboli paint increased by 4% under the premise of conditional return, and the first to increase the price of furniture paint Pierced the window paper.
However, if the customer's purchase volume increases by 15% year-on-year, Garboly will return part of the price increase to the customer.

Industry insiders pointed out that this kind of conditional price increase is made in advance by many paint companies.
As long as one company raises the price, other paint companies will follow up.
Faced with the expected price increase, some large furniture factories said that if you want to increase the price, I will change the paint brand.

This situation is even more cruel to the low-end acetic acid paint market.
Many companies’ distributors said: “If the company does not lower the price of its competitors, it will sell other low-priced brands.
The substitutability of products is too strong, and there are paint companies every day.
’S business manager came to promote the product.
"

It can be seen that raising or lowering prices has become a double-edged sword between the paint companies and the market.
If the control is illegal, it will hurt one of the two parties.

    Terminal sales, low prices move cheese

The confusion in the market was also reflected in terminal sales.

"The sales management of Shandong paint companies is too messy.
The company doesn't care where the products are sold? As long as you can sell them, distributors in different distribution areas are collaborating with each other, making the current paint no market and no profit.
" Reporter, Zhang Fengzhi, manager of Yongchang Hardware Paint Tools Store in Wuqiao County, Hebei Province, was bitter.

Zhang Fengzhi told reporters: "Wuqiao belongs to the Cangzhou area, and he is the general agent of Pentium Coatings in Wuqiao area.
After working hard to develop a certain consumer customer group in the local area, the general agent in nearby areas began to sell goods to Wuqiao at a lower price.
Originally, a 15-kilogram barrel of ash protection was sold for 140 yuan a barrel, but the same ash protection paint from Texas sold for 130 yuan a barrel, which made us unprofitable in the Wuqiao market.
"

"We also encountered this situation in Botou.
" Zhang Ya, manager of Huancheng Hardware, an agent of Botou Bestune paint, told reporters.

Manager Wang of Hebei Yanshan Dayu Hardware Paint Mall told reporters: "In 2014, Lehua Paint sold 500 tons of Lehua Paint, but basically no profit.
The reason is that Lehua Paint has a serious consignment.
The dealers in the nearby Shandong area are all selling goods here.
The two sides are fighting for it.
End customers have opened up price wars.
"

Why is there such vicious collateral behavior in paint?

Liu Lingjie, manager of the Shandong region of Chenyang Water Paint, told reporters: "The company pressures dealers to increase sales by 15% every year, especially for regional dealers with sales of more than 3 million yuan.
An increase of 15% is 450,000 yuan.
At the end of the year, if the sales task signed with the company is not completed, the manufacturer will not receive the 4% rebate, so every year into the second half of October, in order to complete the task, many distributors began to sell goods on a large scale.
"

"Not only the distributors are collaborating, but even some company business managers are collaborating.
" Huang Yue, the regional manager of Jiren New Materials Co.
, Ltd.
, said that every time some downstream consumer manufacturers are selling from local distributors.
After purchasing the product, he will call the company's customer service department based on the information on the packaging barrel.
If the company's customer service staff happens to be a friend of the business manager, they will inform the friend who is the business manager, and then the business manager will tell It can be said that this phenomenon is commonplace in Shandong paint companies to change users to sell at low prices.

Experts in the industry pointed out that in order to obtain abnormal profits, paint distributors deliberately dumped goods into markets outside their own jurisdictions.
Malicious collocation of goods resulted in no more than five reasons: the market is saturated in the region, the preferential policies given by manufacturers are different, and the development of channels is different.
Balanced, brand pull is too large and channel construction has not kept up, and different transportation costs have caused dealers to take advantage of opportunities.
Global Coatings Network believes that if coatings companies do not deal with diversified goods as soon as possible, it is actually tantamount to shooting themselves in the foot.
Therefore, paint companies must manage the diversified goods as soon as possible, seize the opportunity, fix their internal strength, and create their own unique paint brands in order to gain a place in China's huge paint market.

Strict regulations, environmental protection and energy saving speed up

The "Environmental Protection Law" officially implemented on January 1, 2015 is known as the "most stringent" environmental protection law.
The promulgation and implementation of new regulations have had a profound impact on various industries, and the coating industry is the first to bear the brunt.
From February 1st, a 4% consumption tax will be levied on coatings with a VOC content of more than 420 g/L under construction.
This policy has had a huge response in the industry; at the same time, it has long been brewing to downstream coatings such as automobiles and ships.
The policy of levying VOC pollution fees in industries such as containers, coils, furniture, and steel structures may also be introduced and implemented in the second half of this year.
The implementation of these policies will inevitably lead to large waves of paint companies, upgrading and transformation.

"Whether coating companies can develop low-carbon and environmentally friendly products and whether they can adhere to a low-carbon and environmentally friendly production model not only determines whether coating companies can actively respond to the call of the country, but also whether they can gain a firm foothold in the upcoming market.
It also determines whether a coating company can effectively fulfill its social responsibilities and obligations.
Reducing energy consumption, reducing pollution, and developing environmentally friendly coating products in the production process are issues that require deep thought for coating companies.
Therefore, many Large-scale coatings companies are already actively transforming and focusing on green coatings.
Today, when the coatings market is fully environmentally friendly, whether coatings companies can achieve greening of their products has become the key for companies to seize market share.
"Many coatings companies are already aware of this.
Here comes the urgency of environmental protection.

In fact, the use of water-based coatings is relatively early in the world, and the use rate in Europe has reached 80% to 90%.
However, in China, the utilization rate of water-based coatings is still very low, with a market share of only about 7% to 8%, and it is also less than 25% in developed areas such as Beijing and Shanghai.

However, industry insiders pointed out that with the introduction of a series of strict regulations, the market share of water-based coatings in my country may reach 30% or even higher in the next five years.
Looking back at the development history of water-based coatings in Europe, the United States and other countries and regions, policies and regulations have played a vital role in it.
This year, the introduction of the new "Environmental Protection Law" in China is enabling more coating companies to transform and embark on the road of water-based coatings.
(Source: Global Coatings Network) (For more information, please log in: Global Coatings Network http:// )