beauty machine

 

Private labels in automotive refinishing market

I have had an idea of writing this article since long time ago. Initially I believed that as the owner of a private label brand, I would be biased and subjective. Yet, now I feel that it is the right time to share with you my vision. If you visited the last Automechanika Fair last September, you would have realized that there are more and more new brands in the market, mainly private labels. For the known reasons, I cannot use the names of the companies and brands in the article, but in any case, the intention is not to discuss any particular company or brand, but to shed the light on the place of private label companies in the car refinishing market overall.

A little bit of history

In order to understand why there is a growing number of non-manufacturing brands, one should analyze first the very nature of the products portfolio needed in a car body paint shop. The reality is that a contemporary painter requires a wide range of tools and consumables to get the job done. Abrasives, masking products, sealing and anticorrosive materials, personal protection products, fillers, clear coats, primers and, of course, paint itself, are just a few to mention. The range is vast and diverse. It is not possible, even for big multinational brands, to produce chemicals and, let’s say abrasives, at the same time. Yet the end user searches for a one-stop shop to get all his consumables needs covered. Inevitably, even large manufacturers go after the outsourcing of the big part of their products portfolio. Actually, the concept of the private labeling has been introduced by the producers, not traders.

Different types of private label companies, partial manufacturers as I mentioned before, the very first private labeled products have been introduced by the leading paints producers, who wanted to enlarge their offerings by non-paint products, like tapes or sanding discs. I call them “partial manufacturers”. A typical example of a partial manufacturer would be a liquid chemicals producer, who has under its brand’s umbrella all the rest of materials needed in a car repair process. However, for the last couple of years, we see the opposite examples just as well. Producers of abrasives, for instance, add chemicals and other products to their catalogue, and with a great success in certain countries.

Pure private label brands

You can find nowadays a good deal of the brands, which do not produce any or the vast majority of their products they sell. These companies are assembling their products range like a puzzle, working with different manufacturers virtually all over the world. A part of those companies became really sizable businesses, and, they are actually lined up with many leading physical manufacturers. Success here depends on how well-tuned their range is, how the marketing works, and whether they have enough financial background to back the endeavor. Building successful private label brand involves a huge amount of time spent on sourcing and testing the products, which would fit the existing range and create a uniform product offering with consistency and coherence.

Fake manufacturers

I know at least one company, which built its corporate story around a decades old factory, which never existed. The intentions are clear, this brand wants to attract customers, who want to work with “real” producers. Is it good or not? I don’t want to judge.  But believe me, the false or misleading marketing has been used by many companies in different areas of business. One famous notebooks producer boasts that it notebooks were in favor of Ernest Hemingway. Small detail, the world renown writer died before the brand was born.

Advantages and opportunities of private label brands
  • Flexibility. Most of the private label brands are very quick and flexible. They react much faster on the market’s shifts than the physical manufacturers. For example, if a customer of Etalon needs a particular product, which is not in our range, within 30-45 days we can have it ready. Larger companies may need months if not a year to react. The secret here is that we don’t rely on a single manufacturer with its existing range and production restrictions.
  • Using the best producer for the product category. It is not a secret that every manufacturer has strong and weak production sides. A purchasing manager of a private label brand knows very well where he or she should go “shopping” for bodyfillers and where for clearcoats.
  • No geographical limits. This is my favorite. If your market is saturated and/or the local economy is in recession, with your own brand you can literally sell anywhere in the world. Etalon is a proof of this. Actually I am writing this post on my way to Australia and New Zealand.
  • Possibility to serve diverse customers segments. If you are a physical manufacturer in Switzerland or Germany, for example, you may experience a difficulty to cater for the price sensitive markets simply because your fixed costs are high. However, if you are a private label owner, you can create two product ranges, by placing your orders with different producers depending on their price levels.
Disadvantages and difficulties for private label companies
  • High order volumes. If someone decides to launch a private label brand, he or she must be aware of high order quantities required by manufacturers. Usually it is minimum a pallet per product, size or color. Therefore financial backing in this case is very important.
  • Logistics. Big order quantities will require large storage facilities and a fine-tuned logistics are imperative. It is also important to have really professional people in the purchasing department, who will monitor constantly the stock levels and place the needed orders just in time.
  • Overstocking and under- stocking could ruin all the efforts.
  • Marketing. Don’t even think about starting private label without professional marketers and designers onboard. Poor appearance, slow webpage, outdated labels design will never allow you to grow. Unfortunately, many private label brands go unnoticed because of unprofessional marketing. Also, since we are dealing with chemicals, it is crucial to have experienced labels’ designers, who would know all the regulations for safety and dangerous goods handling.
Takeaway

The main idea, which I wanted to share with you is that private label brands could be as valuable suppliers as physical manufacturers. However, launching a brand or a product group with your label is much harder than one could imagine. Constant market prospecting, product testings, innovative marketing techniques, smart brand name, catchy corporate identity, trade mark registration, professional design, miles and miles of traveling, all these are required for success.

Enjoy!

Automotive Paint Supply Shop’s Alternative Paths

The best way to avoid business downfalls is to be proactive. It is just like with our health. Your doctor probably told you that it is much easier and cheaper to treat your body and mind as top priority than to deal with illnesses piled due to bad habits and negligence. Well, business health is no exemption. If you run a shop or a warehouse for automotive collision repair industry, this article is for you.

Threats of the industry

Paint supply in the automotive refinishing industry is a mature and saturated industry. In most of the parts of the world, it grows at a rather moderate pace, and, therefore, doing business becomes more and more difficult. Competition is very high and profits are shrinking. Additionally, international groups buy one shop after another. Consolidation is ruthless and imminent threat to the independent body and paint suppliers. In parallel, supplying automotive paint requires more investment in training, expensive equipment and fine-tuned stock management. Thus, regardless of what state your market is in now, it would be wise to safeguard your future by not putting all the eggs in the same basket. I strongly advice to broaden your products offering and enter one or more from the below mentioned industries.

Industrial paints

Probably the closest product range to automotive paints are the industrial paint systems. Usually the automotive coatings producers can supply mix systems for the light industry as well. Additionally, if you trade automotive paint, then it will not be a big issue to master the niceties of any industrial coating system. However, what is the target market for the industrial coatings? You will be pleasantly surprised how many potential customers are out there. Agricultural machinery, metal construction workshops, various machine shops, sign makers, contractors, you name it. Examples of such mixing systems are Selemix (PPG), Lechsys (Lechler), Ivat, Alcea, Rembrandtin (Helios) and many others. Imagine that with a good industrial mixing scheme you have a mini paints factory at your disposal. Just change binders…

Marine and yachting coatings

If you are lucky to live by the sea, ocean, river or a big lake, then there is a great chance to offer marine and yachting coatings. Whether it is a small fiberglass boat, sailing boat, commercial ship or a mega yacht, they must be protected, refurbished and maintained. The scope of the products include antifouling paints, epoxy primers, topcoats, cleaners, polishes and a great deal of the auxiliary products. Keep in mind that sometimes there is seasonality factor in this industry.

Furniture and wood coatings

It doesn’t matter which country you are in, there are always furniture factories somewhere close to you. Believe it or not, but wooden tables and chairs are painted in a similar way with the car. A painter needs abrasives, spray guns, masking tapes, personal protection products and coatings of course. Even if you decide not to invest in a stock of wood and furniture coatings, there is still a great number of consumables you could sell to this market.

Detailing products and car wash supplies

Detailing shops spring up like mushrooms after the rain all over the place. As people get more educated how to protect their vehicles’ appearance, the demand for the detailing products is growing. Among the products you probably already have on your shelves are polishing compounds, pads, microfiber wipes and polishing machines. Earn new customers by adding shampoos, dressings, washing machines and greater variety of the cleaning products, and you will see your sales growing from the completely different customers pool of hobbyist and professionals.

DIY and construction paints

I have seen many customers of mine, who grew up their range to a full size hardware store with paints, tools and accessories needed for any household. It is a big move, I must admit, because the whole philosophy of the store will must be altered. Selling automotive paints is primarily a B2B business model, while a hardware store carries a big variety of the goods aimed to the non-professional customers or B2C. It is very important to understand the difference. On the other hand, if the collision repair business is declining, then it is a one-way road to enlarge your offerings and target much bigger customer base.

Conclusion

I strongly believe that any entrepreneur should keep his or her eyes open for the new opportunities. The above-mentioned list is not an exhaustive one, of course. There could be many more other related or completely unrelated industries one could consider. The main takeaway from this humble article is that it is much better to stay tuned for an additional revenue, and, who knows, it may turn out a saving vest in difficult times.

Color matching problems not related to the paint itself

Probably color-matching problems are among the most frequent paint defects in the car refinishing industry. It is also the main cause of expensive re-works and unhappy customers. In many cases, the poor color-matching is due to the darker or lighter appearance of the final result. Below I bring to your attention 6 parameters a painter should consider before the basecoat application:

Spray gun pressure

Unfortunately, many painters underestimate the importance of precise measurement of the spray gun inlet pressure. They either do not use a manometer at all, or rely on a poor quality analog manometer.

Outcome: Lower than designated pressure causes darker color result, while higher pressure – lighter color than needed.

Solution: Use a reliable manometer, preferably digital one, for each basecoat application job.

Humidity

Most of the paint manufacturers state the ideal humidity level for the perfect applications conditions. However, we do not have the possibility to control humidity levels easily. For your reference, ideal humidity level is between 30% and 50%, lower than 30% humidity is considered low, while higher than 50% humidity is considered high.

Outcome: Low humidity causes darker result, while high humidity – lighter result

Solution: Adjust viscosity based on the instructions from paint manufacturer, consider changing nozzle size and air cap with lower or higher air flow (consider switching between higher air volume HVLP technology gun and lower volume Devilbiss Trans-Tech or High Efficiency or SATA RP).

Temperature

Just like with humidity, every manufacturer advises the optimal temperature levels for the application. Unlike humidity, it is easier to adjust temperature levels in a workshop, but still there are limitations as well. As a rule of thumb, low temperatures can be considered the range from 15 to 20° C, normal – 20-25° C and high – 28-35° C

Outcome: Lower temperatures will cause darker results, while higher temperatures – lighter results.

Solution: Adjust viscosity based on the instructions from paint manufacturer, consider changing nozzle size and air cap with lower or higher air flow (consider switching between higher air volume HVLP technology gun and lower volume Devilbiss Trans-Tech or High Efficiency or SATA RP).

Thinning (dilution)

Every single automotive coating product comes with a detailed technical data sheet. Unfortunately, often painters either ignore those data sheets or simply continue to work with any new product the “good old way”. In reality, under thinning or over thinning will inevitably cause color problems.

Outcome: Under thinning will cause darker color shade, while over thinning will produce lighter than needed variation.

Solution: Follow the manufacturers’ technical instructions, labels and manuals. Use mixing cups with measurement marking, scales and mixing rulers.

Spray gun distance from the surface

Every sprayer has its own style and spraying technique, however certain standards must be respected. One of the parameters I refer to is a distance between the spay gun and the vehicle’s surface. Consider that normal distance lies within 15 to 25cm range.

Outcome: Too small distance will cause darker colors, too high distance – lighter variation.

Solution: Respect the advised distance between the gun and the surface.

Speed of spraying

Similarly, speed of paint application is very individual and varies from sprayer to sprayer. However, extremes are not good.

Outcome: Spraying with too low speed will cause darker colors, while spraying at excessive speed – lighter color than expected.

Solution: Follow the paint and spray gun manufacturers’ instructions.

 

Spray gun vs iPhone. What a dilemma.

This blog post is not about the new technology in automotive repair industry, nor about its challenges or best practices. This post is about a crisis we definitely have in our industry. This is the human resource crisis. No matter how precise the color matching is, or how fast clearcoats dry, if we don’t have skilled, motivated and proud painters, the industry’s future is not bright. In fact, this post blog comes as a continuation of one of my recent articles “The biggest challenge in the collision repair is to keep it young.”

Just last week we had a round of presentations of new Devilbiss spray gun DV1 on the field. Usually I enjoy this part of my job. What can be better than a direct, unfiltered contact with the end users of your products? While the presentations were “business as usual” , one encounter left me very concerned and in doubt.

My sales manager and I visited a very typical for Greece bodyshop. Average size, family owned workshop of three people. The painter was actually the owner’s son, and the next generation of the business. After initial formalities and casual chat, I asked the young guy about his spaying equipment arsenal. It turned out that he is using two spray guns for basecoat and clearcoat applications. One was a Devilbiss GTI – the very first model of the iconic blue spray gun by the British manufacturer. The other piece was a SATA 2000 model. Both spray guns were purchased many years ago by the painter’s father, and they have obviously seen better days. Looks like a good potential customer, you may think. I thought the same exact thing. However, the youngster looked very indifferent and reluctantly asked for the price. The average retail price for a premium spray gun, regardless of the brand is slightly above 700 Euro in our part of the world. If you take in account that with a quality piece of equipment like Devilbiss DV1 or SATA Jet 5500 (I don’t mention other brands, but the list is not all-comprehensive) one could save massively on materials consumption, improve color matching on difficult metallic colors and decrease re-works, purchasing such gun is a no-brainer. Well, for me at least. However, my prospect customer had a different opinion.

“That is too expensive”, he replied indifferently and took a brand new iPhone XS Max out of his pocket. He started clicking through some Viber messages and turned his back to us. Our pitch came to an end.

En route back to my office I was thinking a great deal about this young man. I wasn’t thinking about the rejection. No. If you are in sales, you know that rejection is just a part of everyday life. What stroke me most is that the “professional” painter didn’t show any interest for something new in his industry. It wasn’t the question of money, of course. Someone who can afford buying an expensive gadget worth about 1300 Euro, can afford investing in his job. Unlike pricy phone, the last technology spray gun (or any other piece of equipment) will earn him money. The problem is that investment in his work is not something he wishes to do, and it is important to distinguish between investment and pure expenses. Purchasing a piece of equipment is definitely an investment. Buying a new phone, unless you are mobile app developer, is an expanse.

To conclude, I would like to say that there are people in our industry who struggle to make both ends meet. Probably not everyone, especially in crisis-hit Greece, can buy a DV1 or similar spray gun. However, a serious sprayer would rather save money for a gun, rather than for a phone. This is my humble opinion.Chances are that this bodyshop will not survive until the next generation, unless the owner changes his attitude.

 

Global Color Popularity Infographics 2018

Translate »