Paints and coatings marketThe paint market can be divided into two main categories, decorative paints and industrial coatings, based on the end-use of the products. In addition to segmentation based on the end use of the product, the paint markets can also be divided based on the price and quality of the product. Paints are usually divided into three quality and price categories: premium, medium and economy. The size of each category varies by country and market area, depending on the standard of living, local painting traditions, construction styles and available materials, decorating trends and the general construction, renovation and industrial activity. A considerable share of Tikkurila’s products consist of premium products.
The total value of the global paint and coatings market amounted to approximately USD 140 billion in 2015. Decorative paints represented approximately 43 percent of the market value. The share of European paint sales in global sales volumes was some 30 percent of the sales value. Tikkurila is a regional player with the Nordic countries and Eastern Europe as its market area. Decorative paints account for some 80 percent of Tikkurila's revenue.
During the past five years (2010-2015) the global decorative paints market has grown at an annual rate of 4-5 percent. However, there has been significant variation in regional growth rates.
Value of the global paints and coatings market
Regional distribution of decorative paints value
Customer segments in decorative paints
In decorative paint segment, three customer types are typically considered: the professional painting contractor, the do-it-yourself (DIY) painter and the buy-it-yourself (BIY) category. In BIY, a homeowner purchases paint for a contractor to apply.
On a global basis, the professional contractor is the primary customer and is responsible for over 40 percent of all decorative paints volume. In Europe, professional painters are responsible for approximately 45 percent of the market. The DIY customers account for roughly 30 percent of overall global demand and is most prevalent in Europe, where it makes up roughly 45 percent of regional decorative paints sales.
DIY segment size is proportional to labor costs. Areas having the highest labor costs, such as Europe, also have the highest DIY coatings percentage.
Share of different customer segments in decorative paints in Europe (Source: IPPIC 2017)
Paint market information on Tikkurila's key operating countries
The most important markets are Russia, Sweden, Finland, and Poland, which account for approximately 80 percent of Tikkurila's revenue.
Paint market in Russia
- Value of the decorative paint market some EUR 1.3 billion
- Average yearly volume growth of the decorative paint market some +6% in 2004–2012, some -1% in 2013-2016, some +2% in 2017
- Decorative paint consumption some 4 liters per capita
- Competitors include AkzoNobel, Lakra-Sintez, Empils, Prestizh, ABC-Farben, Meffert, Caparol, several local players
Paint market in Sweden
- Value of the decorative paint market some EUR 380 million
- Average yearly value growth of the decorative paint market some +2% in 2010–2017
- Decorative paint consumption per capita some 8 liters
- Competitors include AkzoNobel, Flügger, Jotun, Sherwin-Williams, Teknos, several local players
Paint market in Finland
- Value of the paint market some EUR 230 million
- Average yearly value growth of the Finnish paint market one percent in 2004–2014
- Paint consumption per capita some 11 liters
- Competitors include Teknos, AkzoNobel, NorMaali, Sherwin-Williams, several local players
Paint market in Poland
- Value of the Polish decorative paint market some EUR 670 million
- Average yearly value growth of the Polish decorative paint market some +5% in 2012–2016
- Decorative paint consumption per capita some 11 liters
- Competitors include AkzoNobel, PPG, Sniezka, Caparol, Teknos, Flügger, Sherwin Williams, a large number of local and regional suppliers
Tikkurila market shares
Tikkurila is the market leader in decorative paints in
- Sweden with a market share of 37%
- Russia with a market share of 15%
- Finland with a market share of >50%
- the Baltic countries with a market share of >20%
In Poland, Tikkurila is the fourth biggest paint company with a market share of 15%
Historical development of Tikkurila's market shares in key countries
Market share development in decorative paints in Finland (value, source: Association
of Finnish Paint Industry, VTY)
Market share development in decorative paints in Sweden (value, source: SVEFF)
Market share in decorative paints in Russia (volume, source: Chem Courier)
Market share development in decorative paints in Poland (volume, source: IBP Research)
Tikkurila is the market leader in decorative paints currently in Finland, Sweden, Russia and the Baltic region. In Poland, Tikkurila is one of the largest suppliers of decorative paints. The competitive situation on the decorative paint markets has been relatively stable in the past few years, and there have not been many changes in market shares. Considerable changes in market shares have mainly been seen in connection with acquisitions. In industrial coatings markets, Tikkurila delivers various products and solutions to several market areas, and the competition is fragmented by area and customer segment.
Tikkurila's competitive advantages
Strong brands and leading market position
- Extensive distribution network
- Good pricing power
- Paint-related services
Tikkurila's competitors include
- Russia: Lakra-Sintez, Empils, AkzoNobel, ABC-Farben, Meffert, Caparol, a large number of local suppliers
- Sweden: AkzoNobel, Flügger, Jotun, Sherwin-Williams, Teknos, a large number of local suppliers
- Finland: Teknos, AkzoNobel, NorMaali, Sherwin-Williams, a large number of local suppliers
- Poland: AkzoNobel, PPG, Sniezka, Caparol, Teknos, Jotun, a large number of local and regional suppliers