Local companies gaining ground in country's foreign-dominated paint market

Local paint companies are gaining ground on the multinational companies (MNC) who have dominated Bangladesh's paint market for decades, signalling a significant shift in the industry. 

This transformation has been driven by various factors, including a booming construction sector and a relentless commitment to quality and innovation by local industry players.

According to the Bangladesh Paint Manufacturers Association (BPMA), the formal journey of the first local painting company in Bangladesh began in 1952 with Elite Paints. Just a year later, another local producer Roxy Paints entered the industry. 

Apart from these companies, RFL Group's concern Multi-Line Industries Limited produces paint under the brand name Rainbow Paints. Pailac Paints, Moonstar Paints, Nazrul Brothers Paint Industries (Ujala Paint), and Al-Karim Paints also have strong presence in certain regional markets.

Md Kamrul Hasan, executive director of Rainbow Paints, said there are 40 paint companies registered with the BPMA, including local ones and MNCs. 

Some local companies produce paint of quality and standards equal to or even better than the MNCs, he said.

Rapid urbanisation, industrialisation and increased disposable incomes have led to surging demand for paints and coatings, both for interior and exterior applications, by approximately 10-12%. 

The paint industry has an annual market value of around Tk5,000 crore, of which decorative paints contribute to 70% and the rest comes from industrial, marine and automobile usage, as per the BPMA.

Data shows that MNCs contribute to around 60-70% of the total paint, while the rest is met by local producers.

According to market players, the country currently consumes about 180,000 tonnes of paint annually, with room for increased consumption compared to neighbouring countries. The per capita paint consumption in Bangladesh is only 1.1 kg whereas in India it is 4.2 kg, and nearly 9 kg in China. 

Hasan further said, "From the very beginning, our priority has been the uncompromising quality of our products, especially when the MNCs are the most dominant players in the market. Our commitment to quality has been the cornerstone of our strategy to compete effectively with these industry giants.

"In addition to our core product offerings, we have also extended our commitment to quality by providing painting services to our valued customers. To ensure the highest level of service excellence, we took a strategic step by establishing a network of chain shops throughout Bangladesh," he added.

Rainbow Paints, in their journey, focused on capturing a substantial market share through a comprehensive product range and backward integration strategies to enhance operational efficiency. Remarkably, within just seven years, they rose to the top position among local companies and are now eager to further solidify their position, Hasan also said.

According to the market insiders, local paints manufacturers have played a crucial role as a supplier and applicator of road marking paints for prestigious projects like the Padma Bridge, showcasing their commitment to Bangladesh's progress and success. 

In the recently inaugurated Dhaka Elevated Expressway, they supplied the required road marking paint, highlighting their continued involvement in shaping the nation's history.

Hasan said local companies are the backbone of economic growth and development at the community, regional, and national levels. Supporting and nurturing local businesses is essential for creating robust and resilient economies. 

"In Bangladesh's paint industry, both local companies and MNCs are subject to the same supplementary duty. However, our expectation was that the government would prioritise and provide support to the local industry," he also said.

Industry insiders opined that since paint is an essential product, the government could reduce supplementary duty.

Several officials, who previously worked at the foreign paint companies operating in Bangladesh, said local paint companies should enhance their focus in joint collaboration with the foreign companies to develop their technical knowledge.

They explained that local producers are unable to run research and development programmes as it requires huge capital and technical collaboration. 

They also said that Bangladesh still lags behind in terms of per capita paint consumption. So there is a huge scope for the paints market to grow here. In order to capture that market, local companies should focus on diversified products as well as backward linkages.

Besides, the participation of local companies in the big projects of the government should be increased. This will encourage domestic investors to invest in this sector, they further said.