Você está na página 1de 11

PROSPECTIVE DISTRIBUTORS MAPPING IN ALTERNATE

DISTRIBUTION CHANNEL

1. Introduction
1.1 Overview of paint industry
1.2 About Berger Paints India Ltd./Company Profile
1.3 Objective of the project
2. Methodology used
2.1 Industry analysis
2.2 Industry chosen
2.3 Questionnaire design
2.4 Collection of responses
3. Data Analysis and Interpretation
4. Conclusion and findings
5. Recommendations
6. Limitations
7. References
Appendix
CHAPTER 1

INTRODUCTION

1.1 Overview of Paint Industry

The history of Indian Paint Industry is as old as the history of the Indian people. Indian paints
always embrace rich colours and clear symbolism, using specific iconography to make
religious figures clearly recognizable. Manufacturing of Indian paints started around 1902.
The Indian paint industry has seen a gradual shift in the preferences of people from the
traditional white wash to higher quality paints like emulsions and enamel paints. Growing
popularity of new variants providing improved finishing and textures, increasing per capita
income of people and efforts on the part of manufacturers to introduce improved versions like
eco-friendly, odour free and dust and water resistant paints, have propelled the growth of the
paint market in India. Efforts on the part of the manufacturers to introduce innovative
technologies in the paint market have led to a growth in demand for paints in India.

The large scale sector is dominated by four players, namely Asian Paints (30% market share),
Nerolac Paints (20% market share) and Berger Paints (19% market share). The small scale
sector consists of over 5000 players. This growth has been closely linked with the business
and industrial development of modern India. Performance is anchored today in a wide variety
of decorative and industrial paints. Indian paint industry had two types: Decorative &
Industrial Paints. Decorative paint market has been further segmented into emulsions,
enamel, distemper and cement paints. Similarly, Industrial paint market is also segmented
into automotive coatings, high performance coating, powder coating and coil coating.

Decorative paints
Emulsions
Enamel Industrial paints
Distemper Automotive coatings
Cement paints High performance coating
Powder coating
Coil coating

Fig 1.1 Paints industry in India


Decorative paints account for over 75% of the overall paint market in India. Asian Paints is
the market leader in this segment. Demand for decorative paints arises from household
painting, architectural and other display purposes. Demand in the festive season (September-
December) is significant, as compared to other periods. This segment is price sensitive and is
a higher margin business as compared to industrial segment.In industrial paints segment,
Kansai Nerolac is the market leader. User industries for industrial paints include automobiles
engineering and consumer durables. The industrial paints segment is far more technology
intensive than the decorative segment.

The market size of the Indian paints sector has been pegged at Rs 170 bn in value terms and
is very fragmented. The per capita consumption of paints in India stands at 0.5 kg per annum
as compared to 1.6 kgs in China and 22 kgs in the developed economies. India's share in the
world paint market is just 0.6%.As per Indian Paints Association (IPA), the apex body of
paints Industry, the Indian paint market is expected to reach Rs.70,875 crore by 2019-20 from
around Rs.40,300 crore in 2014-15. The decorative paint market is expected to witness
CAGR of 12.7% and the industrial paint market CAGR of 9.5%. The split of the decorative
paint market to industrial market is around 75-25.

The paints sector is raw material intensive, with over 300 raw materials (30% petro-based
derivatives) involved in the manufacturing process. Since most of the raw materials are
petroleum based, the industry benefits from softening crude prices.

1.2 Company Profile: Berger Paints India Ltd.

The driving forces of Berger Paints - reflect the very spirit of its founder Lewis Berger - who
laid the foundations of brand Berger way back in 1760 in the UK. With modest beginnings in
India in 1923, today, Berger Paints India Limited is the second largest paint company in the
country with a consistent track record of being one of the fastest growing paint companies,
quarter on quarter, for the past few years. Undergoing a number of changes in ownership and
nomenclature in its 88 year old history in India, the company has come a long way. Starting
out as Hadfield's (India) Limited, it had just one factory in Howrah, West Bengal. By the
close of 1947, Hadfield's was acquired by British Paints (Holdings) Limited, UK and came to
be known as British Paints (India) Limited. In 1983, the name of the Company was changed
to Berger Paints India Limited. Currently, the majority stake is with the Delhi based Dhingra
brothers. Berger Paints has established itself through a long course of time.

Berger Paints India is headquartered at Kolkata, with 10 strategically located manufacturing


units and about 110 stock points. The company also has an international presence in 4
countries (Nepal, Bangladesh, Poland and Russia). With employee strength of above 2800
and a countrywide distribution network of 25,000+ dealers, Berger is acclaimed as a game
changer in the sector with a vibrant portfolio of paints and tailor-made customer services in
every paint segment.

1.2.1 Vision and Mission


Vision: To be most admired Indiam paint and coating solutions company with globally
recognised competencies.

Mission: To maximise shareholder value by developing and delivering innovative and best
solutions for our customers, consistently outperforming our peers and providing a dynamic
and challenging work environment for our employees

1.2.2 History and milestones

The name Berger or Lewis Berger is today synonymous with colour worldwide. But actually
the origin of the name dates back to over two & a half centuries in England in 1760, when a
young colour chemist named Lewis Berger, started manufacturing in Europe, 'Prussian blue'
using a secret process that every designer and householder coveted. Mr. Berger perfected this
process & art of the blue colour, which was the colour of most military uniform of that time.
Enriched by the imagination of Lewis Berger, the unending quest for creation and innovation
in the world of colour & paints still continues.

The history of Berger Paints India Limited as a company started in 1923 as Hadfield's (India)
Limited which was a small colonial venture producing ready- mixed stiff paints, varnishes
and distempers setup on a 2 acres of land in one of India's first industrial towns close to
Kolkata in Howrah, Bengal. Subsequently in 1947, British Paints (Holdings) Limited, an
international consortium of paint manufacturing companies bought over Hadfield's (India)
Limited and thus the name changed to British Paints (India) Ltd. The gentleman who took
over, as its first managing director was Mr. Alexender Vernon Niblet, an Englishman who
was later on followed by Mr. Alfred Godwin in 1962.

Further in the year 1965, the share capital of British Paints (Holdings) Limited was acquired
by Celanese Corporation, USA and the controlling interest of British Paints (India) Ltd was
acquired by CELEURO NV, Holland, a Celanese subsidiary. Subsequently in 1969, the
Celanese Corporation sold its Indian interests to Berger, Jenson & Nicholson, U.K. Then
onwards the company British Paints (India) Ltd became a member of the worldwide
BERGER group having its operations across oceans in numerous geographies and this
marked the beginning of Lewis Berger's legacy in India which the company would later
take forward to enviable heights.

From 1973 the company entered into one of its dynamic phases of business with introduction
of new generation products in the industrial, marine and decorative segments under the able
leadership of it first Indian Managing Director Mr. Dongargaokar Madhukar.

Year 1976 was another turning point in the history of the company when the foreign holding
in the company was diluted to below 40% by sale of a portion of the shares to the UB Group
controlled by Mr. Vittal Mallya. The reins of the company were taken over by Mr. Biji K
Kurien as its Chief Executive & Managing Director in the year 1980. Finally in the year
1983, the British Paints (India) Limited, changed its name to Berger Paints India Limited.
The entire 80s & 90s saw the lunch of many new products from company's stable such as
premium emulsions and high quality acrylic distempers. The COLOUR BANK tinting system
was launched through which the consumer could select from a range of over 5000 shades.

Again the fortunes of the company changed hands in 1991 with UB Group's stake in the
company bought over by the Delhi based Dhingra brothers, Mr. K.S.Dhingra & Mr.
G.S.Dhingra and their associates of the UK Paints Group. Presently Dhingras' control a
majority stake of almost 73% in Berger Paints India Limited, which is a professionally
managed organization, headquartered in Kolkata, with the stewardship resting since 1994
until 2012 with the Managing Director Mr. Subir Bose. The current managing director of
Berger Paints India Ltd is Mr. Abhijit Roy.

1.2.3 Products

Berger Paints manufactures a wide variety of paint related products. The major categories of
products manufactured by Berger Paints are as shown in Fig. below:

BERGER INTERIOR EMULSION VS COMPETITION


Product Category Berger Brand Asian Brand ICI Brand Neroalc Brand

Luxury Interior Emulsion Silk Royale Velvet Touch Impression

Luxury Interior Emulsion Rangoli Easy Clean - na - 3 in 1 Emulsion - na -

Premium Interior Emulsion Rangoli Premium Emulsion Dulux Super Smooth Beauty Gold

Economy Interior Emulsion Bison Emulsion Tractor Emulsion Rainbow Beauty Smooth

Distemper Bison Distemper Tractor Distemper Magik NAD

BERGER EXTERIOR EMULSION VS COMPETITION

Product Category Berger Brand Asian Brand ICI Brand Neroalc Brand

Weather shield Max


Premium Exterior Emulsion Weather Coat ALL GUARD Apex Ultima Excel Total

Regular Exterior Emulsion WeatherCoat APEX Weather shield Excel

Economic Exterior Emulsion Walmasta ACE Promise Suraksha

BERGER ENAMEL RANGE VS COMPETITION


Product Category Berger Brand Asian Brand ICI Brand Neroalc Brand

Premium Enamel Luxol High Gloss Premium Enamel Dulux Gloss Nerolac Syn.

Economy Enamel Jadoo Enamel/Butterfly Utsav Enamel NA Goody

Satin Enamel Luxol Satin Enamel Premium Satin Enamel Dulux Satin Nerolac Satin

Fig 1.2
Interior wall coatings
Designer Finishes
Interior Emulsion
Interior wall distempers

Exterior wall coatings


Exterior Emulsions
Texture finishes

Berger metal and wood paints


Enamels
Clear wood

Protective coatings

Undercoats

Construction chemicals

Express paintings

Fig 1.3 Product categories of Berger Paints


Fig 1.4
1.3 Objective of the project

The objective this project was to map new prospective and potential distributors for Berger
paints India Ltd. without disturbing existing distribution channel of the company itself.

Most of the companies in Paint industry use quite simple distribution channel. Every
company has its own sales depot in selected cities. Whenever a dealer/retailer requires any
product of company, he/she places an order with sales depot. If the depot has sufficient stock
then the product is delivered from there only, else the order is transferred to companys
manufacturing unit/production unit. The order then is processed there and is finally fulfilled
via sales depot. As a result no distributor/wholesaler is required the process.

However, in order to increase its market share in few selected areas (where its market share
was very low obviously), Berger Paints wanted to have a distributor in that area and that too
without disturbing its existing distribution channel (company sales depot Dealer/retailer).

Hence, each of the interns was allotted one/two districts where they had to map prospective
distributors for Berger paints. For convenience we started by selecting one related industry
and entirely focusing on its distributors/wholesalers. For example, I was allotted Sultanpur
and Pratapgarh districts of Uttar Pradesh and I chose Cements/wall putty industry for
mapping distributors/wholesalers.
CHAPTER 2

METHODOLOGY
2.1 Industry selection

First of all an industry had to be selected so that we could do a more focused study. The
industry chosen had to be a related industry i.e. it should be related to paint industry in the
sense that the distributors in that industry could also dispose of paint, in addition to what they
are currently distributing, to their retailers. Cement and wall putty, Pipes and sanitary, fittings
and furniture, lubricants, Iron and steel industry are few examples of such related industries.
Randomly, Cement and Wall Putty industry was chosen for this study.

2.2 Questionnaire design

The next important task was to find prospective distributors in the allotted areas and in the
chosen industry. For this two sets of questionnaires were prepared one for each retailer and
other for each distributor/wholesaler.

The questionnaire for retailers sought following details from them:

1. Major Brands (of cement/wall putty) prevalent in his/her area.


2. The brands they prefer to keep on their shops
3. Details of the distributor/dealer/wholesaler from where they procure those brands.
4. Credit period offered to them by distributor/wholesaler.
5. Profit percent earned per unit sold.
6. Annual turnover

The main objective to design this questionnaire was to collect the details of the
distributor/wholesaler from where the retailer procures stock. However, this questionnaire
also worked out to verify the details like credit period and profit percent with the distributor
later on. Most of the questions were objective multiple choice questions. However, there were
few subjective questions too like questions seeking details of distributor or those asking for
popular brands in a particular area.

The questionnaire for distributors/wholesalers sought following details from them:

1. Name and contact details of distributor/wholesaler.


2. Number of retailers/sub dealers under that distributor/wholesaler.
3. Details of godown, transportation facility and manpower with distributor/wholesaler.
4. Credit period offered by company and credit period offered to retailers.
5. Profit percent earned.
6. Annual turnover
7. Whether interested in expansion or not.

The main objective of this questionnaire was to collect the basic details of the
distributor/wholesaler and to estimate their capacity/capability, profit percent earned and
credit period offered to retailers as well as credit period offered by company. These details
were very important to collect as this provides a preliminary information to the company
(Berger paints) while settling down final terms and condition with the distributor/wholesaler.
These details also helped to eliminate the distributors with lesser capability. As a result lot of
time could be saved by visiting only few appropriate distributors who could actually cater to
the needs of company.
REFERENCES

1. Indian paint industry to grow to Rs 70875 Cr by 2019-20. (2017, January 6).


Retrieved November 16, 2017, from http://www.business-
standard.com/article/economy-policy/indian-paints-industry-to-grow-to-rs-70-875-cr-
by-2019-20-117010600949_1.html
2. Indian paint industry report- Paint sector research and analysis in India. (2016,
February 3). Retrieved November 15, 2017, from
https://www.equitymaster.com/research-it/sector-info/paint/Paints-Sector-Analysis-
Report.asp
3. 14_chapter 5.pdf. (n.d.). Retrieved November 15, 2017, from
http://shodhganga.inflibnet.ac.in/bitstream/10603/75865/14/14_chapter%205.pdf
4. Largest paint manufacturers, textures and plastic paints manufacturers- Berger Paints.
(n.d.). Retrieved November 16, 2017, from https://www.bergerpaints.com/about-
us/company-profile.html
5. Shah, B. (2013, April 13). Welcome to Bhavikk Shah's blog. Retrieved November 16,
2017, from https://4.bp.blogspot.com/-
8ZA0r3O4jSU/UWUPNx6jfkI/AAAAAAAABcE/g4MRti9TjSY/s1600/Berger+roub
d.jpg
6.