Clarifications:
I tried to give an overview of what happened rather than a detailed scenario. When buying paint try to look at it from a consumer pov rather than the investor pov(because we are more aware of the paint industry). When I said price doesn’t matter in this industry I meant the decorative segment as it contributes 80-85% and the rest comes from B2B(My mistake) and Indigo only operates in the decorative segment. I did face a push from the dealer but only in low-value products like distemper but for high-value purchases, the final decision came from me(Again I should have clarified it further but if anyone tried to purchase paint recently then it would be evident). Coming to dealers, and retailers rather than going on trips or receiving gifts the high priority will be on moving products as fast and as much as possible(With newer Brands there is always this risk). I agree dealers and retailers try to sell a product that gives them more margin but all players follow and give the same discount. If you observe the trade discounts(Everyone player has a cap on how much they can give the discount) For Example:: last quarter everyone in the industry followed the same strategy(I listened to all con-calls starting from Asian paints to Indigo paints) on how much they can provide trade discounts due to raw material easing. If you listen to the last con-call of Indigo paints & Akzo Nobel they specifically talk about how trade discounts and A&P won’t increase sales and dealers.
Coming to pricing:
I respectfully disagree because pricing in B2B is completely different from B2C. If you observe everyone talks about new entrant being big, competent, and can disrupt the industry but fail to understand that already a formidable player entered and has been in the industry for the last 3 years(JSW Paints). They are large in their respective industries. I haven’t seen any pricing war in the industry (Apart from all colors same price but not being able to garner much attention at least where I am located). But on further observations, I noticed they are introducing differentiated products, increasing brand image, and trying to get dealers from weaker brands. When it comes to B2C: Brand recall, Differentiated products/Innovative products, sales aggression matters a lot more than price.
*** I have zero knowledge of the B2B category. So, I won’t comment on that ***
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