Picture markets

PRODUCTS AND MARKETS

Paint production in Australia can be broadly divided into two major segments; architectural/decorative paints and industrial paints and coatings. Based on annual ABS statistics for the year ended 1995, architectural and decorative paints account for 52% of production, with industrial paints and coating comprising 48% of output. The industrial coatings are usually formulated and produced for specific needs.
The processing line, from raw materials to the end user is relatively straightforward. Manufacturers sell a small proportion of their product, direct to the end user through retail outlets.

A greater proportion is sold to master painters and painting contractor companies via trade depots. An even larger segment is sold to retailers, both large chain stores and local hardware stores. The main production categories are shown below. The Australian market is insulated from the world paint market by a number of factors which provide effective barriers to entry.

From 1 July, 1996, the general rate of Tariffs will drop to 5%, however, also four that date the system of 'duty free' entry to certain goods under tariff concessions will cease to operate. The main factor against competition international manufacturers is the cost of freight, plus an 8% tariff barrier until 1 July, 1996. Existing manufacturers are further protected from competition by their established position and knowledge of the market. These advantages include existing control of the paint distribution system, established product differentiation and brand loyalty, and technologies developed for Australian climatic conditions. The need to be familiar with Australian standards for formulation, labelling and packaging requirements is a further barrier to importers.

Architectural/ Decorative

52% of users Public, Home Handyman. DIY, Trade Painters, Government , Ex factory, Retailers.

Industrial

48% Users

of which

  • General Manufacturing = 20% e.g
  • · Agricultural implements
  • · Appliances (white goods).
  • · Aluminium Extrusion.Direct sale to end user.
  • Heavy Duty Industry = 15%
  • · Mining
  • · Ship Building
  • · Bridges
  • · Oil rigs
  • · Pipelines
  • · GovernmentDirector sale to end use/or by tender procedure. Tender.
  • Automotive (7%)
  • · New car production.
  • · Refinishing Shops.Direct with manufacturers.
  • · Director sale to end user.
  • · Coil Coats (6%)Producers of sheet metals e.g. Aluminium Industry.Direct sale to end users.
  • Packaging Coats = 4%
  • · Can coats for food and beverage.
  • · Soft tube coatings.Direct sale to end users.
markets