Swot Analysis of Asian Paints Essay Example

is widely distributed with a country-wide distribution network of 13,000 dealers, regional offices, company depots, and sales personnel. They possess strong inventory control, with an average inventory level of 28 days sales compared to the industry average of 51 days. AP Paints' pricing strategy is geared towards middle/lower end consumers. With a policy of providing tailor-made products to cater to individual customer needs, they have continually expanded their product range through in-house production and no outsourcing. Their production-marketing coordination is also quite strong. AP Paints leads in terms of profit and operating margins with a ROI of 40%, while the rest of the industry has a ROI of 22%. The net worth of AP Paints is Rs 204 crores, surpassing Goodlass Nerolac's Rs 58 crores and Berger's Rs 41 crores.AP is known for its high caliber human resource and has a significant proportion of MBAs among its employees. Its corporate reputation is a major strength, as it has won many awards and accolades, including the 1995 Corporate Excellence Award from HBSA and ET. AP has been rated as one of India's most excellent companies and among the top 5 paint manufacturers in the world by various studies. However, AP's weaknesses include only having a 15% market share in industrial paints, far behind the leader Goodlass Nerolac, which has a market share of 43%. Additionally, the company faces strain on production distribution, accounting and administration due to its widening product mix. While AP's innovation in developing new products is adequate, it has a major weakness on the technology front in industrial paints. Most paint firms have technology tie-ups with manufacturers abroad, which AP lacks. For example,

Goodlass Nerolac has a tie-up with Kansai paints, which has given them an advantage with Cathodic Electro Deposition (CED) technology. As Kansai is the supplier to Suzuki, Japan, Goodlass can easily tap Maruti in India. AP has not been able to make any significant advances either with Maruti or the auto segment in general.Berger has several tie-ups for automotive, heavy-duty, and powder coatings with Herbets in Germany, Valspar Corp in the USA, and Teodur NV in Holland. However, the company's expanding product mix has put a strain on inventory management, especially during off seasons when seasonal demand can lead to cash flow problems. While Berger has units in several countries, it currently has no tie-ups with foreign manufacturers. Despite this, there are opportunities for the company to acquire and increase market share in the Industrial paint sector. In addition, developing the market for the automobile industry could be particularly beneficial as it accounts for 50% of the Industrial paint market. Berger has always been quick to capitalize on opportunities and has maintained a product profile that reflects market trends. As evidence of this, Berger shifted their focus to predominately producing industrial paints instead of decorative paints as seen in their 1995-96 production figures.