Painting & decorating: Too many players in the scrum?

By Terry Herbert February 16, 2016 Painting & Decorating

2015 saw big changes in the paint channel, most noticeably with Dulux disappearing off Mitre 10 paint shelves and the launch of Valspar. So we took to the streets and the paint counters to see if we had reached the tipping point and if so who was missing out?

To view a PDF of the complete feature as it appeared in NZ Hardware Journal magazine, click the download button at the bottom of this page.

For the sake of this feature we decided to go to one catchment area and ask the paint experts at the retail coal face what effect Valspar was having on their business.

Drive south from Auckland’s CBD, hang a left at the Ellerslie Panmure Highway and you will reach Mt Wellington or at least what’s left of it after decades of quarrying. This fulcrum suburb sits ungainly on the cusp of other suburbs that socio-economically cannot be more opposed.

From the state houses and decile One schools of Point England to working class Mt Wellington, swinging north to the loftier climes of St Heliers, Glendowie and the private schools and mansions of Remuera, it’s a touchstone for our economy.

Even mid-week as we approach the Bunnings paint counter there are customers asking earnest questions and the staff are busy. When he gets a break a broad smiling Matt Murphy, Bunnings Paint Specialist, shares his experiences since the launch of Valspar at Mitre 10.

“The introduction of Valspar was good for us,” beams Murphy. “We saw a definite lift in Dulux sales. As the most obvious Dulux outlet for miles around we actually had customers coming in here looking for the brand.

“We’re selling good volumes of the Dulux Wash & Wear so I guess the advertising must be working. We get customers from all the feeder suburbs. Just look in the car park at the BMW X5s parked next to the 20 year-old people movers.

“We stock British Paints and PPG as well. We continue to see steady sales of these brands. These are also good paints so the customer still has choice when it comes to quality paints. We keep our Spring brand as a price fighter.

“In this store we get more DIYers. The weather hasn’t been our friend but we’re selling good volumes.”

Less than 600m away, soft left at the Panmure roundabout and we’re at Pleasant View Road, where a sizable Guthrie Bowron store straddles a corner site.

Director, Ishwar Sadhu, says matter-of-factly: “The introduction of Valspar has not made a noticeable change to our business. It hasn’t affected us. We sell Dulux, Guthrie Bowron, Wattyl and some Taubmans.

“We are a Dulux Trade Centre. We keep a separate Dulux till (cash register) so it’s easy to track sales. What I can say is that Dulux have become far more aggressive with their promotions.

“The new Dulux Wash & Wear promoted by those two from MythBusters have lifted awareness. Sales are going very well. Our split here is 60% trade and 40% retail. Overall it’s business as usual.”

 

BIG BOXES SEEM TO BE BREEDING

We drive back along the Ellerslie Highway and turn right into Lunn Avenue where all the big boxes (not just hardware) seem to be breeding.

An orange box looms large. Even mid-week the car park is largely full. Inside the Mt Wellington Mitre 10 MEGA we find paint specialist Ayden Jacobs behind the counter where he begins by telling us candidly: “Yes we did have early teething problems with Valspar’s automatic tinting system but that’s all sorted. If the counter is busy it is faster, but the main reason is to avoid human error.

“Our catchment area takes in St Heliers, Glendowie and Remuera. We get far more DIYers than trade coming in here. I can’t give you figures but, when Dulux was taken off the shelves and Valspar first came along in August, we barely noticed any drop in sales.

“Resene has always been a strong brand here and we did see a slight lift in sales. A lot of people will come in here and walk passed the other brands to get their Resene. The Save the GST Sale has helped keep those sales flowing too.

“We’re starting to see a big lift in Valspar sales now, especially with the advertising. It’s hard to escape the Valspar chameleons. Initially in the first summer months, we had lots of Cabot’s deck stain sales and the new applicator helped too. We get the big demand for exterior paints later in summer.”

 

MOVING RIGHT ALONG…

Just two asphalt car parks away, separated from the MEGA by a shiny, glass-covered New World is a very large blue PlaceMakers box. Here you see more SUVs and utes and sunburned men in shorts and work boots. Inside, the lighting is dimmer and the atmosphere is more serious. It’s Men at Work.

PlaceMakers paint specialist and team leader, Mark Cooper, is the human embodiment of all that trade nous. His long, spare frame and searching looks leaves no doubt that here is a man who knows the trade and knows his paint.

In his opening volley he tells us: “The mix here is 60/40 in favour of tradies. It was great for them when they were working on Stonefields, which is right across the road. But now I get them coming here from all over.

“I was a commercial painter before joining Placies and (laughing) some of the boys call me the paint guru. I’ve been in the paint game for a very long time and as team leader I train the paint staff.”

When I ask him about what effect Valspar is making on his sales he snorts derisively. “We carry big accounts here. Usually we estimate an entire project and often that includes paint, and accessories. We look after the trade here and they look after us.”

And does he consider the Valspar auto tint system a threat? Again he makes that derisive sound. “Automatic tinting systems are nothing new. Dulux introduced one years ago. I’ve been colour matching by eye for years and I haven’t had a complaint yet. We’re busy at my counter and that’s not going to change.”

Snuggled behind and just north of PlaceMakers Mt Wellington is the Resene ColorShop at 108 Lunn Avenue. We put the same Valspar question to Store Manager, Hayley King: “I can only speak for this store and everything is the same. We didn’t notice any change,” says King with a shrug.

“Over the years Resene have invested heavily in product development and brand awareness. We also like to pride ourselves that our staff here have more product knowledge than staff at the big boxes. We’re the paint specialists and consumers know they can trust us. We sell solutions, not paint.

“This is a trade store but we get a lot of consumers here too, especially women who are seeking colour advice, so I put the mix at 50/50 trade and consumer.”

 

TALKING TO THE PAINT BRANDS

So, if we can believe the paint specialists at the big boxes, sales of the other major brands have not noticeably changed. So is someone missing out? We took this question to the smaller, local paint manufacturers.

Robin Wright, Managing Director Coating Technologies Ltd (Cotec) was forthright and almost philosophical in his response: “Yeah 2015 was just OK, it certainly wasn’t a stellar year. It’s quite a complicated subject.

“I believe there’s plenty of business out there, we just need a bigger share. The outlets and distribution is difficult for us. Obviously the big boys want to protect their markets and their distribution chain which makes it difficult for us to get into the big stores.”

I ask Wright how he intends to grow business. “Because we’re a small company we’re not going to drive the market. We find niches and exploit them.”

For example? The Building Code is changing requirements for the building industry,” he confides.

“Built into the Code is a fire rating requirement, particularly for hospitals, hotels, motels; wherever you have large numbers of people gathering. Some of these building codes are ahead of what paints are available.”

Which is why Cotec has obtained the NZ agency for a brand of fire retardant paints called Firefree (www.firefree.com). Says Wright: “These products actually meet the new Building Code requirements.”

 

ANOTHER PLAYER, ANOTHER NICHE

Another local paint company that is expert at ferreting out specialist markets is PaintPlus. We spoke with Director, John Warman who has had a very good 2015, “because we developed new products that appealed to niche markets that don’t have a lot of competition.

“We develop products that replace imported products, so we’re not affecting New Zealand players. The film industry for example is a big niche market for us. We provide 80% of all the paint used in the Australasian film industry. It’s feast or famine. When it’s on, it’s full on. When it’s not, it’s cold.

“We provide green screen and one-off colours. We work very closely with the people who do the painting and some have become personal friends. We worked on Avatar and we had to remain tight-lipped about that.

“There are three Avatar movies that are going to be filmed soon and produced back-to-back, so when we get the call it’s going to get very busy. We work directly with scenic artists. There are a lot of movies in pre-production right now. I can say it’s going to be busier this year than last.”

We ask Warman about new products in the pipeline. You can tell from his almost glib response he’s been asked this before: “Think niche and think global! We’re pretty secretive about our new products because we like being under the radar. These products will have enormous appeal offshore.

“I have a green bent. We’re the only paint company in the world who is carbon neutral. When we started making environmentally friendly paint it wasn’t fashionable. All our paints are eco labelled and we are carbon neutral, so that’s our point of difference.

“Carbon neutral is about the company and eco labelling is about the product. We’re audited annually by carbon zero and bi-annually by environmental choice. It’s no walk in the park.

“New Zealand makes great paint. I’ve recently been to the UK and they make rubbish paint. You wouldn’t sell it here or only once. I’m very positive about our year ahead. I can’t wait.”

 

WHAT ABOUT THE ADD-ONS?

And what about paint accessories? How did they fare in 2015 and are they optimistic for the year ahead? We asked PAL, New Zealand’s biggest accessories manufacturer.

PAL’s Richard Percy responds: “2015 was very good for PAL. Both retail and trade had a good year. The paint market as a whole has undergone big changes in 2015 at a retail level so our business reflected that.

“If you hold your breath you die. More and more our market is changing to supplying unique products to unique channels. The big boxes are getting bigger and more dominant but is the paint market getting bigger? In my opinion, probably not. What that means is that the independents are getting squeezed.

“In dollar terms we’re 60% retail and 40% trade. We don’t see this changing. We are the dominant player in NZ and we’re determined to stay that way.”

As I make my way back to base in the city, mentally preparing for the inevitable motorway gridlock, I recap my store visits.

Adding another quality paint to the market hasn’t seemed to effect the other players too much. Dulux appears to have suffered the most, first by no longer having access to Mitre10’s and secondly because they are now forced to promote more heavily at a local trade level and at a national level with more advertising.

Meanwhile, the smaller independent paint companies have got smarter. They’re zigging when the three big players are busy zagging…they’re finding or developing new products for new markets. The paint channel is doing well but by god it’s not getting any easier. Roll on the dry months.

 




WHO SPENDS MOST? THE CLASH OF THE TITANS

The paint market really is a clash of the titans. To be able to express that and find out just how much Resene, Dulux and latecomer Valspar spent in advertising in calendar 2015 we were allowed a sneak peak at a recent version of Nielsen’s Competitive Advertising Spend break down.

These figures are rate card and do not take into account the various Volume Incentive Discounts that media agencies negotiate with the media channels. Typically, advertisers spend less than rate card.

These gross figures include all media which covers Television, Radio, Newspaper, Magazine and Online. The biggest media at 80%+, by dollars spent, is by far television. Proof that our watching habits haven’t changed too much.

Total spends are as follows:

  • Resene $4,721,024
  • Dulux $3,761,716 (includes Cabot’s $780,651)
  • Valspar $2,461,505 (includes Wattyl $180,538)

Resene and Dulux spent throughout the year. Valspar spent a whopping $2,264,142 in October and November alone. For these months their chameleons dominated the media.

During the months of September to December 2015, Dulux countered Valspar’s launch with their Mythbusters Wash & Wear campaign spending $1,624,085 on this product launch alone.

www.nielsen.com/nz

 


 

TALKING TRADE WITH THE “MASTER PAINTER”

As the old Firestone jingle used to say, it’s where the rubber hits the road that really counts. For the paint industry, it’s where the bristles hit the weatherboard that counts.

Who better to share his insights on the professional painters wielding the brush, roller or spray gun than Brian Miller, CEO of the Master Painters NZ Association (MPNZA)?

 

How was 2015 for the paint professionals?

It’s been a mixed year. For example, many of our members had a tough winter. The 2015 winter was long, longer than it’s been for a while. A substantial part of contract work is exterior painting and the southern regions found it a particularly challenging time.

In the last quarter of 2015 the market lifted significantly across most of NZ.

In contrast, Christchurch painting contracts actually dropped right back because the bulk of the EQR work has been done. What that effectively means is the bulk of the ‘rework’ won’t be available for up to 10 years or as properties change hands.

The commercial work in Christchurch has not flowed at the anticipated level – yet. There’s a lot of framing going up, which means it will come in due course, but the painter is at the end of the trade gang, so it will be months and years before it makes a difference. There are some reasonably big projects happening right now in other parts of the South Island, especially in Central Otago.

 

Where are the regional hot spots for the paint trade right now?

First of all, a good painter will always have work, wherever they are and whatever the weather or marketplace is doing. That said, and no surprise, Auckland is going off the dial. There’s $5 billion worth of construction in the CBD and massive developments everywhere around the region.

Auckland’s biggest downfall is its own success. Surplus tradespeople available now in other parts of New Zealand cannot afford to relocate and live in Auckland. It’s too expensive to live there. Immigrants have a similar problem, the cost of accommodation and living in Auckland precludes many from working there.

Central Otago is another place where you can’t get a painting contractor for love nor money. Because it’s such a popular tourist destination year-round, unless you’re a local you can’t afford to live there either and they’re screaming out for painters.

If you had a pulse and a driver’s licence they would give you work.

 

How easy or difficult is it to start a business as a professional painter?

Starting your own paint contracting business catering to the residential market is not a big step. Unlike other businesses, there’s no big plant or equipment outlay, you can be a sole trader and contract hire help when you need it.

Typically you’re working directly for the home owner. Your terms of trade are usually simple – you get paid as you walk out the door.

Starting a commercial paint contracting business is another story. Working with the big boys is a different game. Your compliance expectations are much higher and timelines are incredibly tight.

Normally a construction firm is the site manager you’re dealing with. Those big boys don’t suffer fools on sites. They’re skilled at what they do, they expect performance and you have to deliver.

On those big sites they take no prisoners and rightly so – it’s a hard environment, they’re on tight time lines so you really need a good degree of commercial nous and commercial acumen to make it in that environment.

Another real challenge going from a small residential SME to a commercial contractor is the payment regimes are quite different. The home owner is a lot swifter in making payments, whereas in the commercial world you’re dealing with commercial terms that are outlined in the contract, so you need sufficient financial reserves behind you to deal with that.

 

Anyone who’s around greater Auckland’s many large building or private residential sites may have noticed quite a few teams of “recent arrivals” onsite. Do you see them as a problem?

Absolutely! They’re a major issue for us because our members are meeting compliance requirements, particularly around health & safety, but some of these painting contractors are not. They’re blatantly ignoring health & safety requirements. I tell you, it’s like the Wild West.

Our members price to do the work efficiently, but safely, and there is a cost to doing that. I personally wouldn’t want the consequence of an accident on my home. That’s something that home owners need to think about.

The new law applies to the contractors coming on to the property. Whoever is managing the project is the “duty of care officer”. If you want to self-manage that project with all those subbies you need to ascertain if you have “duty of care” responsibility. If you do, you are responsible for any accident or mishap.

A good example was a church I was working on. They wanted to pay for the scaffold erection themselves. In that scenario they would have had a “duty of care” to everyone who came on to that scaffold. If they’d had a professional project manager or a builder that would be his responsibility.

The paint trade is an unregulated minefield. I’ve seen non-compliant painters quote $1800 for a roof paint when the scaffolding alone would cost that much. The paint is another $800, so the owner gets a one coat lick on their roof.

The best thing for us is to have WorkSafe actively inspecting and very visible, in the residential sector in particular.

My advice to anyone considering employing paint contractors is be careful. Research your tradies, check their backgrounds. There are a lot of brokers who put on a public front on websites and their ethics are questionable.

 

Who is the biggest paint brand with the trade?

It would be fair to say by volume Resene are the biggest right now. That’s primarily because our members tend to use what is specified. So it gets down to designer, project manager or home owner preference. Most of our members have trade accounts with all the “big three”. If consumers say we want Resene or we want Dulux, the wise contractor adheres to their wishes.

All the major brands are supplying some of the best paints in the world. Cotec and ColourPlus make great paint too.

 

What’s your opinion of the new health & safety regime?

My summary of the new Act is this: doing nothing is no longer an option! No matter if you’re a sole trader or run a hundred staff, you are now more accountable.

Dulux have just signed off on sponsoring a huge health & safety package, compliant with the new Act, to our entire membership at no charge. That’s a huge sponsorship and we’re very grateful!

Part of my role is to lobby Government. I’m lobbying right now to introduce licencing. We deal with Building & Housing. With Government you deal with the unforeseen consequences of what they write and our job is to put that into effect. It’s a war zone. It’s fun!

What I want is for my members to have a good business and get home safely at the end of every day.

 


 

LOOK THROUGH ROSE GLASSES AND SHE’LL BE WHITE – COLOUR TRENDS FOR 2016

Dear reader, take a moment to get in touch with your inner self before reading this. It’s time to get soft and gooey.

 

Colour me touchy feely

For the first time the colour experts at Pantone, whose influences range far beyond the colour of your bedroom, have chosen not one but two colours as the Colour of 2016.

These shades blended together, they insist, will help us, seek mindfulness and well-being as an antidote to modern day stresses. These welcoming colours psychologically fulfil our yearning for reassurance and security.

Joined together, Rose Quartz and Serenity demonstrate an inherent balance between a warmer embracing rose tone and the cooler tranquil blue, reflecting connection and wellness as well as a soothing sense of order and peace.

Whatever. Just expect to see these colours on catwalks and the tongues of interior designers as they spend their well-heeled clients’ money.

 

About white supremacy

America’s largest paint company, Benjamin Moore, has named Simply White OC-117 as its Colour of the Year, a choice that lit up social media late last year with designers and Joe Public openly criticising the choice.

Benjamin’s Colour & Design Director, Priscilla Ghaznavi, explains the company chose this colour after 10 months of research and having looked at over 250 whites in its catalogue before choosing Simply White as “the most neutral and constant white when exposed to various light sources”.

Ghaznavi further says: “It helps us appreciate the form and shape of an object and it defines a space in a beautiful and sophisticated way. Simply White accepts and embraces anything you put next to it.”

Me, I’m just going to get that large white canvas I’ve had in the garage for years meaning to paint and whack it straight on the wall.

 

Rice cake anyone?

Closer to home we asked Resene Colour Consultant Sarah Gregory about her colour trends for 2016.

“The exterior colour trend for 2016 is white on white. Very clean whites. Often you’ll just see all white but sometimes white with a little black for window trims.

“Grey and white have been around now for the last few years but this year we’ll definitely be moving more into the whites. That said grey and white is still very popular.

“Looking at interior colour trends, white interiors are still popular. Whites that have quite a lot of black and grey in them which can be quite a sterile look were on trend.

“What the new trend now is warmer whites such as our Rice Cake which has got a little bit of a yellow undertone which just warms it up a little and Merino is really popular as well.

“And if we look at colour what is popular now is a soft duck egg blue. It’s not a cold blue, it has a magenta through it which makes it a warm blue. The further south you live the more you’ll see a tendency toward warmer interior colours, particularly in the South island.

“The other trends are greys used internally. It sounds boring but it’s not because you can highlight it. The biggest on trend colour combination is grey and yellow. Grey walls and yellow accessories like pillows and lamps.

“Jungle greens, bright greens and deep greens will be on trend – not the citrus greens that we’ve had before. Nature-based greens are really in too. Along with greens there are also inky blues and what we call sorbet colours or pastels. Sorbet colours like peach and pink soft yellow.”

 

Pick a colour, any colour…

Gretchen Flynn, Specifications Manager at Laminex, has the final word on interior colour trends for 2016.

She says to expect a range of greens, terracottas and blues. Meanwhile red is being reinvented to more of a soft raspberry. Every now and again a yellow highlight comes through. Black will be used to frame a colour.

Your neutrals go on hard surfaces like walls and bench tops and then you use these colours for an accent or on accessories.

Overall we can expect more soft whites and more soft shades and pastels.

Group hug anyone?

share this