Fri | Sep 22, 2017

Paint maker seeks market in Jamaica through franchise partnerships

Published:Friday | September 23, 2016 | 9:00 AMTameka Gordon

Trinidadian paint company Kaleidoscope Paints Limited is hoping to re-enter the Jamaican market and is actively recruiting franchisees to produce and distribute its products.

The company previously sold through Facey Commodity Company but that relationship ended in the 1980s, said Kaleidoscope General Manager Dexter East via email.

He said the company wants two partners in Jamaica to distribute its line of automotive and decorative paints.

"Both will be involved in licences/light manufacturing arrangements, which will create additional employment in Jamaica," he said.

Kaleidoscope opted to distribute through franchisees since consumers will most likely support a locally known agent over an outsider, East told the Financial Gleaner.

Founded in 1970, Kaleidoscope boasts of being the first 100 per cent owned paint manufacturing company in Trinidad and Tobago, with markets in Antigua, Belize, Suriname, Dominica, Guyana, St Vincent, St Lucia, Grenada and Haiti, the company's website said.

Kaleidoscope is, at the same time, expanding into Cuba and Central America, East said.

Back in the mid-1990s, the company increased daily productive capacity from 7,000 gallons to 21,000 gallons.

Kaleidoscope's re-entry in Jamaica will mean direct competition for at least four other brands that trade here, only one of which is Jamaican-owned.

In the line-up of paint companies, Berger Paints Jamaica Limited and BH Paints West Indies Limited hold the number one and two spots, respectively. Berger is ultimately owned by Asian Paints of India, while BH is Barbadian-owned.

The other players are Sherwin-Williams (West Indies) Limited, and EdgeChem Jamaica Limited, owned by Doreen Frankson.

Another Trinidadian company, ANSA McAL, sells the Sisson and Penta lines in Jamaica through ANSA Coatings Limited.

ANSA McAL's operations spans eight sectors throughout the Caribbean, including its home market Trinidad, Barbados, St Kitts-Nevis, St Lucia, Guyana, and Grenada, as well as the United States. Sisson was reintroduced to Jamaica in 2014.

Kaleidoscope is aiming for two per cent of the Jamaican market in year one, 3.5 per cent in year two and six per cent by year six, East said. The value of the Jamaican paint market is unknown, but its main player, Berger Jamaica, reported annual revenue of $2 billion at March 2016.

"We are aiming at very conservative figures, as the process will be a learning one for the partner, and for the consumers," said the Kaleidoscope GM.

Citing a 2012 survey of the Jamaican decorative/ architectural or house paint market, East said the market then amounted to 8.3 million gallons of volume sales.

Sales have since been growing at the rate of 1.2 per cent per annum, he said.

BH Paints puts its hold on the market in the lower 20 per cent range, with Berger commanding the lion's share of the market.

BH Paints is owned by the Harris Group of Companies of Barbados. Its paints are distributed under two brands - BH in Jamaica, Belize and Cayman Islands; and Harris in the rest of the Caribbean.

Penta Paints General Manager Trevor Lloyd, who previously headed Berger's marketing team, downplayed the impact of a new market entrant.

"The competitive rivalry is at its most intense right now but it is another choice that the consumer has, and another player coming in can be a good thing," Lloyd said. Still, he said none of the companies can afford to be complacent.

Berger International operates in six regions, including Middle East, Africa, South Asia, South East Asia, South Pacific, and the Caribbean, through its six brands - Berger Paints, Asian Paints, SCIB Paints, Apco Coatings, Taubmans, and Kadisco. It has been in Jamaica since 1953.

EdgeChem, founded in 1990, is a wholly Jamaican-owned company, while Sherwin-Williams is a subsidiary of Sherwin-Williams Company of the United States.

tameka.gordon@gleanerjm.com