Executive Summary
The total UK market for paints and varnishes was worth around £1.5bn at
manufacturers selling prices in 1992. In value terms there was a slight fall in
the market in 1992, of between 2% and 3%.
Key Note's definition of the market is a broad one. Included are retail
decorative paints, varnishes and woodstains and decorative paints and wood
finishes for the trade sector, i.e. professional decorators and specialised
coatings for a wide variety of industrial, construction and transport
applications. Among these, paints used in vehicle manufacturing plants and
vehicle refinish paints are particularly important.
Most sectors have suffered a downturn since 1988. The trade decorative sector
has been badly affected by the downturn in construction activity, the slump in
house moves and the closure of many business premises, while several of the
industrial sectors have suffered because of the downturn in manufacturing. The
retail decorative sector has been less severely affected by the recession and
this has been largely through the efforts of manufacturers in product
innovation and promotional activity. Recent innovations have included
low-odour, water-borne paints and varnishes, new colour ranges and special
formulations for dealing with cracked ceilings.
The industry is dominated by large international groups and acquisitions
activity has led to concentration of the industry over several years. There has
been a further spate of acquisitions activity in 1992. There has also been a
tendency for the market leaders to rationalise their activities, concentrating
on building up market shares in their core sectors and shedding more peripheral
activities.
Concern over the health of those working in the paints industry or using
paints, and environmental problems, has led to more stringent regulations and a
search for less harmful paint formulations. Water-borne paints have now been
widely adopted by the automotive industry and have seen increasing sales in the
decorative sectors, while aqueous refinish paints are also coming onto the
market.
Overall, 1993 is likely to be another fairly flat year for sales growth. Any
upturn is likely to be towards the end of the year. In the longer term, the
prospect is for gradual recovery in the main sectors.
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