Paint manufacturers diversify to grow in challenging environment

The paint industry is diversifying the business to grow in a challenging environment in Brazil. Bets range from increased distribution points until franchise projects of factories. "There's an optimistic expectation for Brazil, but haven't felt that reflect the day to day business. The growth projection of Abrafati [Brazilian Association of paint manufacturers] is 1.9% in 2019, but ours is at least 10% ", says the CEO of Iquine, Eduardo Moretti Inks. He explains that the company has invested in production processes to become more competitive and sought to expand your presence in the national territory. "We have a strong participation in the North and Northeast and we're looking for some time for other squares, reinforcing our commercial part in the Southeast, Midwest and also in the South." CONSTRUCTION Paint manufacturers diversify to grow in challenging environment Companies seeking new markets and different business models for greater profitability and superior performance to designed for industry in 2019, which should grow only 1.9% Franpaint unit: franking can be done with minimum initial investment of R $550,000 Franpaint unit: franking can be done with minimum initial investment of R $550,000 photo: RICARDO DISCLOSURE CASARIN • PAULOPublicado in 03/05/19 to 05:00 are The paint industry is diversifying the business to grow in a challenging environment in Brazil. Bets range from increased distribution points until franchise projects of factories. "There's an optimistic expectation for Brazil, but haven't felt that reflect the day to day business. The growth projection of Abrafati [Brazilian Association of paint manufacturers] is 1.9% in 2019, but ours is at least 10% ", says the CEO of Iquine, Eduardo Moretti Inks. He explains that the company has invested in production processes to become more competitive and sought to expand your presence in the national territory. "We have a strong participation in the North and Northeast and we're looking for some time for other squares, reinforcing our commercial part in the Southeast, Midwest and also in the South." Moretti account that the search company for better productivity in your plant, located in Jaboatão dos Guararapes (PE), to reduce the pressure of cost of inputs. "About 70% of our raw materials are dolarizadas, so the Exchange represents a big impact on costs. With a market in a situation of little heating, it's hard to pass, "he explains. The Executive believes a resumption of construction during the year. "The general feeling of our customers is of extreme optimism with the Country and with the new political situation. We are sure that there will be an improvement in the market that will benefit the industry. But that has not yet been reflected in sales. " Franchises the Franpaint bet on a franchise model paint factories. "The idea is to support from the industrial to the digital marketing implementation through training. In addition, the brand has partnered with suppliers of equipment, raw materials and packaging, "explains Operations Director Manfred Wimber. He says that works for almost 20 years in the industry and has developed the project to provide know-how to customers of retail. "During the crisis, we have seen many shops closing or having problems. Giving this support, we make the client more competitive and help the market, "he says. Wimber explains that the initial investment required to become a franchisee is R $550,000 real. "This includes machinery, raw materials, operating system and formulations. The capacity is around 2000 buckets per month or 50000 liters of paint. " The pilot plant is located in Diadema (SP). "This factory is largest, received an investment of RS $4 million and has a capacity of 111,000 buckets. Was made to spread the brand and deliver the training, "he says. The expectation of the Franpaint is to have a total of six franchises by the end of the year. "We will have more in St. Louis [MA] and we are in negotiations with five more States. In addition, we're going to have a franchise in Bolivia ". The Commission notes that the company does not require exclusivity of retailers franchisees. "They can sell whatever you want. Our price is competitive and the quality of the product is premium. The shopkeeper will notice that is advantageous. " In addition to the initial investment, the company receives a 3% royalty rate and a 1% marketing. The estimates of return on investment for the franchisee is 10 to 24 months.