Crown Paints projects growth in 2015, targets to grow market share by up to 70 pc

 

Kenyan government has rolled out several infrastructural developments in the construction sector and the resulting effect of this means local production capacity and utilization of paints and coatings in the country is set to expand significantly with industry players forecasting an upbeat year.

The market for paint manufacturers have remained at all time competitive in the last few years with entry of new players scrambling for a pie of the local market share poised to trigger business-battle for home-grown market share.

But not so for paint maker Crown Paints.

A chat with Crown Paints Chief executive Rakesh Rao reveals otherwise-with the man sitting at the helm of undoubtedly a successful business empire obliging about the perceived Kenyan paint market share competition from its peers.

“What competition?” He poses, we have been in the business long enough to understand it better than anyone else and we don’t make noise in terms of advertisements and still remain market leaders in the field,” says Rakesh with an overwhelming confidence when we visited him at the company’s premise along Lunga Lunga Road, Industrial Area.

Despite the presence of other local paint manufacturers such as Sadolin Paints and Basco (Dura Coat) Paints and Berger Robillac, Mr. Rao says the market for paint makers is likely to remain relatively busy but Crown Paints will seek to offer products with a high price-performance ratio as well as interior solutions to counter the expected competition.

A report by Frost &Sullivan on the performance of Industrial Paints and Coatings Market for South Africa, Nigeria and Kenya finds that the sales volume of industrial paints and coatings across the three countries stood at 101.2 million litres in 2012. This is estimated to reach 142.1 million litres in 2017.

Crown Paints, the leading market player in terms of market share and infrastructure, registered a growth of between 17 to 20 percent both in premium and regular business in 2013, retaining the company’s position in the market with 65 percent premium market share at the time and 40 percent in regular market an additional 10 per cent of the economy segment compared to the two other local players who command less than 50 percent market share combined.

 In Uganda the company has a 40 percent market share.

Rakesh says under his leadership the company targets to increase the company’s market spit by up to 70 percent by end of 2015. But reveals the journey to the top has not been a rosy one.

“Last year was a big year for us, with new expansion drive and launches across the nation and the wider regional market. Despite being market leader in the market, we are not resting we are still on cause with our showrooms expansion,” says the father of two.

“It is an honor and proud to be associated with Crown Paints and so far I can confidently say that I am proud of what I have achieved since I joined the company as a CEO close to a decade years ago, but I will tell you this journey has not been easy,” he opens up.

It is remembered in November 2014, Rakesh Rao won numerous awards key among them being voted CEO of the Year last year during the annual fete’ of COYA awards for being a chief executive  with strong leadership and focus to surpass strategic objectives in his company.

Rao was lauded for having a great impact in both customer and staff satisfaction built towards a world-class company. He dedicated the award to his team of staff and customers whom he described as having an endearing spirit to the company.

“Am a believer in team work, and the company has won tremendous awards due to what we do; our products are of high quality. I took over when the company was making turnover in millions but now we are making billions and our target is to generate over 6billion by close of the year.

“I also took over when the company had a mere 45 percent market share but now we are about 68 percent market leaders in the business and we are hopeful to hit 70 percent by end year with our new products and services.

“When I joined the company we had only 120 staff working for us we have since grown the number to over 700 staff today. Today we have more than 200 distributors spread across the region- this is no mean achievement.

“We still however face many challenges till today ranging from high taxation from the government and counterfeit-we lose about 10 percent of our revenues to counterfeits and cheap products from China,” says Rao who is an avid golf player.

He says the company plans to increase its grip on the regional paint market by boosting its premium and economy market shares by between 10 per cent and 15 per cent respectively, and has already set up a manufacturing plant in Dar es Salaam in Tanzania last year.

“We have new launches and developments coming in place. We have already opened 5showrooms within the country and we anticipate opening seven more within the year to make a total of 10 showrooms this year,” he said during the interview.

In February this year Crown Paints announced its entry into Rwanda with the establishment of an ultra-modern paint showroom in Kigali with a five-year plan to invest about $2.5 million (Sh225 million), with Rwanda consequently becoming the third country to host Crown Paints’ showrooms in East Africa as the paint maker also owns five other show rooms in Kenya and one in Tanzania.

Rakesh Rao says the company also plans to establish a paint factory in Rwanda.

“Rwanda is an exciting market for us and our aim is to increase our presence in the region. You need to have your product spread across the region if you are going to increase your market share and remain relevant in the game,” says Rakesh.

The paint maker has been in an expansion spree. In 2014, Crown Paints announced entry into the Tanzanian paint industry and invested $3.6 million (about Sh316m) in 18 months to build a market leading company and further opened a paint showroom in Dar-es-Salaam to become the headquarters of Crown Paints Tanzania, enabling the company to expand into other provinces in the country.

For Rao the journey is not yet over and he says the company is still in the process of developing more products and services in the coming years.

Rakesh believes his style of leadership has greatly boosted the company’s volumes and reputation and says one has to be discipline in whatever they are tasked to do.

“As a listed company I represent interests of all shareholders and I have to be at my best by ensuring the company is headed in the right direction. You have to give your all as a CEO. You also have to communicate nicely to your staff, clients, learn to understand their emotions and feelings.

 

“Also reward them with incentives and scholarships and promotion as a way of motivating them. I believe in people’s performance,” says Rakesh a man who reveals he gets most of his inspiration from the mother.