Foreign Paint Firms Cornering Vietnam Manufacturers
Published August 14, 2013
Foreign-invested paint companies in Vietnam are putting pressure on local manufacturers.
The Vietnam Paint and Ink Association said the country has an annual total output of 250 million litres of paint, including 180 million litres of decorative paint.
Chalermsak Pimolsri, marketing director of the foreign-invested Four Oranges Paint Company, said the average consumption was 1.5 litres of paint per head per year in Viet Nam, much lower than the four litres a year in Thailand and seven litres in developed countries.
Foreign-invested paint makers already hold 65 per cent of the local market and have advantages with trade marks, finance and diversification of products, he said.
Another foreign-invested paint firm, Jotun Viet Nam Co Ltd, has expanded its factory and increase capacity to 25 million litres of paint per year.
Director of AkzoNobel Paints Vietnam, David Teng, said the company had invested 13 million euro (US$17.3 million) to develop a factory in southern Binh Duong Province.
The association said Viet Nam has about 600 paint companies, including 30 foreign-invested firms holding the lion's share of the market. Local paint companies produce lower quality paint.
However, some domestic paint is becoming competitive, including Kova, Dong Tam, Tison, Alphanam and Hoa Binh.
The local firms mainly sell their products in provinces while the foreign firms dominate the large cities.
Hoang Van Hung, director of Nero Paint Co Ltd, said domestic companies must diversify their products to increase market share.
Local companies also seem to have an edge in non-decorative paints, including the Hoa Binh Paint Company's paints for coastal environments - and waterproofing, heat and nano paints [produced by the Kova Company].
Nguyen Thi Hoe, chairwoman of Kova Group, said her firm had sustainable development on the local market but aimed to develop exports. It already sells to Singapore and Indonesia.
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