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ASIAN PAINTS DEALER
Key takeaways
Asian Paints gives dealers a margin of ~7% on mass and mid-end products and 8%-12%
on premium products. New players such as Nippon, Jotun and Sherwin Williams are
offering higher margins. However, volumes for the newer players are low and supplychain
efficiency is one of the biggest challenges faced by them.
APNT has ~20,000 dealers and clubs them in various buckets—(1) ordinary dealers, (2)
critical retailers (gives training and updates on features of the company’s products), (3)
privilege members (given some information on the company’s prospects), (4) privilege
premium members (two staff members from the dealer’s shop are taken to the company
site and training/relevant information is shared with them), (5) super privilege members
(form inner coterie of the company). There are ~40 super privilege members and ~400
privilege premium members and privilege members each.
To increase loyalty of painters towards APNT’s brands, the company has introduced a
‘Masterstokes’ card which is a reward point system.
~15% of paint demand is for new construction and the balance for repainting, repainting
cycle has reduced to ~4 years now.
Strong infrastructure and dealer network is the biggest strength of APNT.
Supply-chain efficiency is APNT’s strength—it services the key dealers twice/thrice a day
(competition’s service efficiency is ~3 days) which results in lower inventory carrying cost
for the dealer and hence, higher ROI for them.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
ASIAN PAINTS DEALER
Key takeaways
Asian Paints gives dealers a margin of ~7% on mass and mid-end products and 8%-12%
on premium products. New players such as Nippon, Jotun and Sherwin Williams are
offering higher margins. However, volumes for the newer players are low and supplychain
efficiency is one of the biggest challenges faced by them.
APNT has ~20,000 dealers and clubs them in various buckets—(1) ordinary dealers, (2)
critical retailers (gives training and updates on features of the company’s products), (3)
privilege members (given some information on the company’s prospects), (4) privilege
premium members (two staff members from the dealer’s shop are taken to the company
site and training/relevant information is shared with them), (5) super privilege members
(form inner coterie of the company). There are ~40 super privilege members and ~400
privilege premium members and privilege members each.
To increase loyalty of painters towards APNT’s brands, the company has introduced a
‘Masterstokes’ card which is a reward point system.
~15% of paint demand is for new construction and the balance for repainting, repainting
cycle has reduced to ~4 years now.
Strong infrastructure and dealer network is the biggest strength of APNT.
Supply-chain efficiency is APNT’s strength—it services the key dealers twice/thrice a day
(competition’s service efficiency is ~3 days) which results in lower inventory carrying cost
for the dealer and hence, higher ROI for them.
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