Dutch multinational paint and coatings producer, AkzoNobel has been operating in Vietnam since 1992, when the company began selling architectural paints in the country.  Later on, the company invested in four state-of-the-art production facilities in the country. In 2015, AkzoNobel invested in a performance coating facility and doubled the output of its existing powder coating production facility.

Coatings World: What differentiates Akzo Nobel Vietnam from other paint producers in the country?

Pamela Phua: With our rich history dating back to 1792 in the Netherlands, AkzoNobel and AkzoNobel Vietnam deliver quality and green innovation meeting customers’ needs with our passion for paints. Worldwide, we are recognized by architects, designers and contractors as a reference in the industry with our color expertise and thought leadership in sustainability.

We are active in Vietnam providing one-stop solutions to the construction industry with our Decorative Paints and Performance Coatings which includes Wood Coatings, Coil Coatings & Packaging Coatings; Powder Coatings, Marine & Protective Coatings, and Specialty Coatings. Dulux is our popular household brand as a premium choice in decorative painting.

In addition to that, we have a wide range of sustainable products which effectively support Vietnam in facing current challenges of sustainable development and urbanization. In the country, we are widely known as the first manufacturer of powder coatings.

Powder Coatings, in general, is one of the fastest growing coatings sectors, as the technology is increasingly seen as the preferred solution in a world which is strongly focused on environmental issues.

CW: How many production plants Akzo Nobel operate in Vietnam. What is the scale and scope of all the production facilities? What is your approximate market share in architectural and industrial segments in the country?

Phua: We have four manufacturing sites in Ho Chi Minh City, Dong Nai, Binh Duong and Bac Ninh to serve both retailers and project customers.

Our powder coatings plant is located in Nhon Trach (Dong Nai) with 151 employees and Specialty Coatings plant is in Que Vo (Bac Ninh) with 64 employees.

The plant in Ben Cat (Binh Duong) supports the Decorative Paints business, with an investment to expand the capacity up to 100 million liters per year. It is our largest plant in the country with 336 employees. In Bien Hoa (Dong Nai), 320 employees are manufacturing Wood Coatings; Coil Coatings, Packaging coatings & Adhesive Coatings.

Architecture and decorative wood coatings will remain the primary consumers of paints and varnishes, especially as Vietnam’s major cities continue massive building booms thanks to years of rapid economic growth. We are now one of the major players in architectural and industrial segments in the country with Decorative Paints Vietnam as the No 1 in terms of market share based on value.

CW: Do you cater to export markets from Vietnam. If yes, which are the important export markets for your company?

Phua: Our four coatings manufacturing facilities in Vietnam are supplying coatings to customers throughout Southeast Asia.

Southeast Asia is a market which is experiencing robust economic growth, with a large population and high levels of construction. This is one of our key markets and where we keep standing at the leading position in consecutive years.

In the past decade, AkzoNobel hugely invested in this region especially in Vietnam with new technologies and services.

CW: Despite, the steady growth in Vietnamese paint industry, per capita consumption of paints and coatings is abysmally low in the country.  Do you see the situation changing in the medium and long term?

Phua: Currently, we are witnessing massive building booms in major cities thanks to years of rapid economic growth. There will be a requirement of large quantities of paints following the enormous high-end housing developments altering the skylines of the country’s urban areas and the apartments housed in these buildings. In view of that, we see potential growth in the consumption of paints and coatings in Vietnam.

CW: Which segment of Paints & coating industry is most significant for Akzo Nobel in Vietnam?

Phua: In Vietnam, architectural and general industrial coatings are the biggest segments, which accounts for the largest portion of our business. In all of the segments in this market, we are the leader.

With the recovery of the Vietnam economy and growing affluence of its population over the next 5 years, we believe that the Premium segment will be the fastest growing in terms of market sales value. Mass segment’s market value will also be significant as well as this is the biggest volume segment in the market.

CW: What according to you are the three biggest challenges facing Vietnamese paints and coating industry?

Phua: Firstly, the business environment is becoming more and more competitive with more players to join the game. This requires us to make multiplied efforts to maintain our leading position.

Secondly, there are regular upward and downward swings in raw material costs, which affects the whole supply chain so we are always on the lookout for alternative materials that are both sustainable and economical.

Thirdly, Vietnam is experiencing an emerging trend of urbanization and construction that means it takes us a certain period of time before Vietnamese are familiar with our technologies rather than traditional methods.

However, we see those challenges as opportunities that we will fully tap into to make ourselves different from our competitors.

CW: Vietnamese consumers are considered among the most price-sensitive consumers, globally. To what extent, a price hike necessitated by rising crude oil and TiO2 prices be a roadblock in the growth of Vietnamese paint industry in the current and coming years?

Phua: This is the common market trend, which somehow causes an unavoidable fluctuation in product prices. As consumers become more discerning and environmentally conscious, eco-premium products are on the rise as consumers seek out products that have more environmental benefits than their mainstream equivalents. With today’s growth of technology and innovation, we see an abundance of opportunities to thrive in this sector and this will be our priority in the long run.

We will continue to take proactive steps with new innovative and environmentally responsible paint solutions as we believe this is right for our business both ethically and commercially. 

CW: Green or environmentally friendly paints have almost become a norm in developed countries. What is your take on this sub-segment in Vietnamese paint industry? Approximately what proportion of your total sales do these products constitute in the domestic market?

Phua: Producing green or environmentally friendly paints is not a part of our production but a focus. Staying one step ahead in the development of environmentally friendly coatings is one of our leading priorities. We manufacture to the highest environmental standards in order to minimize harmful emissions and waste, both in the factory and at customers’ plants.

At AkzoNobel Vietnam, we are not only aware of sustainable business operations, but it is also a practice ingrained in our DNA.

As the leader in the decorative paints industry, we are always committed to preserving the environment in whatever we do. Almost all of the products we are offering Vietnam market are with the least impact as possible and we are also step-by-step introducing sustainable products including eco-performer and eco-premium category to Vietnamese.

AkzoNobel is offering Vietnamese world-class local services, consistent and reliable quality (30 years warranty on products), and solutions for customers across the country through Interpon and Resiscoat brands.

CW: What has been the most challenging assignment in your professional career? How did you deal with that situation?

Phua: My initial role in R&D is a natural fit for me since my degree is in chemistry. I was the director of R&D in the SESAME (South East South Asia Middle East) region for 12 years and director of the Global Exterior Wall Paints Expertise & Research Group for the last seven years. Last year, I started my new business role as the general director of AkzoNobel Vietnam. Thus, this business role is pretty new to me. However, we have achieved beyond expectations, thanks to the steadfast leadership as well as commitment, dedication and hard work of my teams. Passion, resilience and commitment to teams are the values I hold very close to my heart and I believe these are what drive me and help me and my teams to succeed.