Demand for paints picking right up again

21 Sep 2020 10:22 AM
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The stage was all set for Kansai Nerolac Paints Bangladesh, as it was annually growing at 25 % since acquiring majority stakes of another high-performing paint maker RAK Paints in 2018. Foolproof strategies were also in place to become the best in the business.

But suddenly the Covid-19 came to the scene and slowed the momentum.

The contagion started its run by hitting the earnings first and reducing the quarterly sales by almost a half, said Vishal N Mothreja, CEO of Kansai Nerolac Paints Bangladesh.

Thanks to the strong management, however, the business stayed afloat, said the Indian, who joined the Bangladesh chapter of Kansai Nerolac with over 22 years' experience in the paint industry.

The pandemic caused an monetary trauma and showed how poorly prepared the united states aswell the world was to fight a disease, he told The Daily Star during an interview last week.

All but fast-moving consumer goods, food and hygiene products-related industries remained closed from the finish of March to mid-May, when the demand for paint fell sharply, he said.

"We were actually doing really great before the Covid-19 outbreak. But the pandemic caused a complete pause in the complete supply chain."

All of a sudden, there was none to offer any paint job to the painters, the frontline soldiers of the paint industry, he said.

People's intention to avoid being infected with the microscopic virus by postponing all varieties of paint jobs eventually dented the financial health of all paint makers, he said.

However, Kansai Nerolac Paints Bangladesh, which originated from the world's eighth major paint manufacturer Kansai Paint of Japan with operations in 80 countries in Asia, Europe, America and Africa, stood by its employees, painters and Bangladesh as a whole in the trying times.

The company extended donations to the painters who were the worst hit by the pandemic, said Mothreja.

"We didn't choose any job cut. Rather we kept paying salaries to your employees on time. Moreover, we also hired some more to care for our future selection of products."

Moreover, the multinational paint producer joined the battlefield to kick the coronavirus out of Bangladesh with the launch of a countrywide safety awareness campaign in-may, he said.

"We launched another campaign through the Eid-ul-Azha urging people to remain indoors and not to visit unless it's necessary in order to stay safe from the coronavirus."

"Kansai Bangladesh believes in the wellbeing of our stakeholders. We had given safety guidelines and safety kits to your employees and took all effective measures to ensure their safety."

Digital platforms became the medium to carry all external and sales meetings of the business, he said.

However, the sector started slowly recovering with the reopening of the economyin early July, from when Kansai Bangladesh once again started growing faster than its competitors, he said.

The demand for paint, the quantity of paint jobs and the entire sales figures all started out increasing, he said.

Through the two-month closure, the business done some marine products and launched the entire range, including a few construction chemical products, soon after the shutdown, he said.

"We will be launching powder coating and adhesives in the next few months."

"All our earlier growth plans for Bangladesh have been a bit delayed because of this pandemic, but none has stopped," Mothreja said.

A 101-year-old company, Kansai Paint entered India by acquiring 75 % stakes in Nerolac in 1999. Today, it's the largest commercial paint and third major decorative paint company of India.

Net sales of Kansai Paint, also a champion in automotive coatings, were up 6.33 % year-on-year to 427,425 million yen in fiscal 2017-18.

Kansai Paint forked out $7 million or Tk 57.26 crore to buy 55 per cent stake of RAK Paints through its Indian subsidiary Kansai Nerolac Paints.

In India, Kansai has introduced a distinctive technology paint called "Nerolac Excel Virus Guard" interior emulsion, he said.

Predicated on Japanese SHIQUY technology, the paint is 99.9 per cent effective against virus and bacteria looked after controls surrounding bad odour and humidity.

"We will launch the same in Bangladesh soon."

At present, people are receiving used to the "new normal". "It's a very important thing."

"We do hope that the Covid-19 situation comes under control soon. However, you need to also be prepared in case the problem holds out for long."

The focus of Kansai Bangladesh is always to ensure both top-line and the bottom-line growth, he said.

The company includes a range of decorative products beneath the Kansai Nerolac Paints umbrella, which have distinctive advantages of the consumers regarding economics, aesthetics, health insurance and hygiene, he said.

"We are building upon this range by adding a few more products under the Healthy Home Paints plank. We also will be considering consolidating our water proofing range."

The focus of Kansai in Bangladesh is definitely on high performance coatings required for all of the mega infrastructural projects, he said. "This shall help us in increasing our revenue."

To improve dealer-based sales, the business is focusing more on the "below the line" activities, as dealers and painters are fundamental, he said.

The government should now think about launching something for online transfer of customs duty, which would ensure faster release of goods from the ports, he said.

The government should now fulfil the long-pending demand of the paint makers - a waiver on supplementary duty, he said.

The minimum tax on sales also needs to be waived during this pandemic year for the sake of the return of the tiny and medium industries to normalcy, he said.