Brand Management

Akzo Nobel ICI Assignment

Ali farukhh Farid ahmed Haroon 1233 Umer Naseer 1236 Umar parvaiz Shoaib azam 1191 MUHAMMAD JUNAID 309-1209


April 18, 2011

Hajvery University Euro Campus Lahore

The paint industry in Pakistan operates both in the organized as well as the unorganized sectors. There are around 22 paint producing units in the organized sector. There are two multinational companies also in the organizational sector. According to an estimate, over 350 units producing paints are operating in the unorganized sector. Many of them are also not covered under the excise net in the same way as the organized sector and therefore, are in a better position to compete in the local market. According to the latest findings of Federal Bureau of Statistics, around 30,000,000 liters of paint was produced from 87 units. Pakistan Paint Manufacturers Association (PPMA) represents the organized units in the paint sector. Paint is categorized in two broad classes; namely water based paint and solvent based paint. The industries produce a wide range of finished and intermediate products which include pigments, distempers, plastic emulsion, enamel, undercoat, primers, rubber paint, aircraft paint, marine paint, anticorrosive paint, anti fouling paint, etc.

Growth in Paint Industry
The demand for paints is derived from expansion in construction, building, manufacturing, transport and other sectors. The country has yet to go a long way in its development efforts. There appears to be a sizable potential for further strides in the country¶s paint industry. Moreover, the development of chemical industry is also taking place and therefore, most of the raw materials used by the paint industry


are expected to be produced and manufactured locally during the next five years. The paint industry would thus find cheaper raw material for further expansion and growth. There are huge opportunities for the growth of paint industry in Pakistan. But due to Economical recessions and unstable Political conditions this industry has declined. Pakistan is currently experiencing a GDP growth rate of 3.5-4.5%. Meanwhile the paint industry is witnessing a 6-8% growth rate. This high growth can be attributed to the current boom in both the automotive as well as the construction industry. However if we see the data below, it can be easily said that there is still great potential for growth in the paint industry in Pakistan.

Per Capita Consumtion [Paints]
0.5 Liters 8 - 10 Liters 4 Liters Pakistan Singapore Brazil

The table above shows a comparison of the per capita consumption of paints in Pakistan, Singapore and Brazil. Thus it can be seen that Pakistan is way behind with only 0.3 Liters of consumption from these more developed countries.

ICI Pakistan Limited ICI Pakistan Limited (Imperial Chemical Industries) is located in Karachi, Pakistan. The company was subsidiary of ICI Plc United Kingdom but with worldwide takeover of ICI PLC by AKZO NOBEL now AKZO NOBEL is 75.81% stake holder of ICI PAKISTAN. It was set up as a public limited company in Pakistan in 1952. The ICI Group is a renowned international business. It employs approximately 31,000 people worldwide. The vision of ICI is to be the leader in formulation science. It has, and continues to develop, a portfolio of businesses that are major players within their respective industries, bringing together outstanding knowledge of customer needs with leading edge technology platforms to provide superior products to its customers. Through these attributes, it aims to create superior value for ICI customers and shareholders, without compromising its commitment to safety, health, environment and the communities in which it operates. ICI Pakistan Limited is involved in various businesses including:      Polyester Fibers Soda Ash Paints Chemicals Pharmaceuticals



1944 The Khewra Soda Ash Company, a predecessor of ICI Pakistan Limited, set up a soda ash manufacturing facility in Khewra with a capacity of 18,000 tonnes per annum. This facility was sited next to the salt range as rock salt and limestone, two key raw materials needed for manufacturing soda ash, were available here in abundance. 1953 The Khewra Soda Ash company was incorporated as a public limited company. 1966 The Khewra Soda Ash Company changed its name to ICI Pakistan Manufacturers Limited. Over the next few decades, major changes took place in the company as our Specialty Chemicals and Polyester plants were commissioned, and Imperial Chemical Industries (Pakistan) Private Limited and Paintex Limited both merged into ICI Pakistan Manufacturers Limited.

1987 We changed our name to ICI Pakistan Limited We launch our Seeds business as well as the Dulux range of coatings. We also established ICI Pakistan PowerGen and set up the ICI Pakistan Foundation as a charitable trust. 1995 We set up a USD 490 million PTA manufacturing facility at Port Qasim, near Karachi. 1998 PTA manufacturing facility commissioned. 2000 The business was de-merged to form Pakistan PTA Limited, which was at the time a subsidiary of ICI Plc UK. 2007 We completed 50 years of continuous listing on the Karachi Stock Exchange. 2008


We formally became part of the AkzoNobel Group, bringing us under the banner of one of the largest coatings and chemicals companies in the world.

Our values
The beliefs that underpin our business Our values define what we are and what we aim to be. They reflect the way we should operate both internally and externally. And they¶re summed up in the line µTomorrow¶s Answers Today¶. We believe in:
y y y y y

Focusing on our customers¶ future first Embracing entrepreneurial thinking Developing the talents of our people The courage and curiosity to question Integrity and responsibility in our actions

These values give us standards to measure ourselves by, particularly in our dealings with customers, suppliers, our own people and the wider world. The values have real meaning for us and the way we behave. Here¶s what each of them means in practice: Focusing on our customers¶ future first We can guarantee our future only by giving our customers products and services that improve their future. So this value comes first. It¶s our priority and the reason why we exist.We¶ve always met the needs of our customers ± that¶s why we¶ve grown. But now we make it very clear: it¶s the basis of everything we do.

Embracing entrepreneurial thinking
New thinking and new ideas are everything ± if we¶re to compete. So we need an environment and a mindset that encourages new ideas from individuals and teams. ³Yes´, not ³Yes, but...´ ³Why not?´ not ³Why?´ We might fail occasionally, but we¶ll get great ideas to market more quickly as a result. And we¶ll keep more people with truly original ideas within the company.

Developing the talents of our people
Our business will grow if our people grow too. So we¶re committed to professional and personal development. We¶ll do all we can to develop existing talents, nurture new skills and progress within AkzoNobel. Through this commitment, we¶ll attract and retain people of the highest quality to develop the business.


The courage and curiosity to question
AkzoNobel isn¶t one of those companies with a set way of doing things. We dislike rigid hierarchies and we want our people to take a broad, interested view of the world. We like them to ask questions. ³Is there a better way?´ There generally is a better way, if we challenge ourselves and our customers to look at things differently. It¶s the way we improve.

Integrity and responsibility in our actions
Business needs to work within a framework. Our employees have to be aware of rules and regulations that they must comply with, in whatever part of the world they work. But integrity and responsibility go deeper than that. They¶re about doing things in the right way, as individuals and as a company. Ethical and responsible behavior matters to our business. If we do the right things, people will know we¶re a company that can be trusted. They¶ll then be more likely to work with us and invest in us ± which is good for our long-term growth. This ambition defines us. This is the way we work. This is why we come to work. This is AkzoNobel. Tomorrow's Answers Today At AkzoNobel, we believe the future belongs to those smart enough to challenge it. We believe that real progress belongs to those who not only think with courage, but also have the courage to deliver on the thought. Tomorrow¶s answers, delivered today. Often people achieve only incremental progress, because their view of tomorrow is determined by what they see today This benefits our customers because we sustain their future competitiveness and meet the consumers¶ unspoken needs.

Our brand shows the way forward Slogan


AKZONOBEL TOMORROW¶S ANSWERS TODAY All the evidence shows that consumers and business customers are more likely to deal with companies with strong brands. Our brand also gives our customers an assurance of quality and purpose. It contains a promise ± Tomorrow¶s answers today ± that motivates us to deliver, think ahead, increase customer satisfaction and drive future business.

Mission Statement
³Enriching people¶s lives by bringing visual delight and lasting care to their surroundings´

y y y y y y y y y y Market driven-innovation in products and services Winning in quality growth market worldwide Inspiration and reward of talented people Exemplary performance in safety and health Responsible care for the environment Relentless pursuit of operational excellence To be No.1 in all its 6 Pakistani businesses To achieve turnover of 20% in 2002 from over all business portfolio. To reduce its industrial wastes by 50% till 2004. To contribute at least 25% in overall ICI Pakistan profits.

Five Years Goal for ICI Paints
y y y y Target 10:20:30 10% return on sales (ROS) 20% growth in sales in 5 years (3.7% CAGR in organic like for like business) 30% Return on Net Assets (RONA)


This is the formula from which ICI Paints sets and achieves its targets i.e. 10% return on sales, 20% growth in sales in five years and in the last 30% Return on Net Assets. y y y y y Total adherence to HER. Dedicated involvement of every employee at all levels of the organization to the total quality management concepts. A complete focus or prevention of non conformance through cohesive team work. Constant emphasis on ³doing it right the first time and every time´ Improving the quality of everything we do, to the complete satisfaction of internal and customers.

ICI Paints Business Lahore
y In 1965, ICI UK acquired a 50% interest in the paints company named as ³Fullers Paints Pakistan Ltd´ situated at Ferozepur Road, Lahore. Its name was changed to Paintex limited and it was converted into a public limited company in 1973. The capacity of the plant was upgraded and enhanced in 1981 and since then the business has proceeded progressively to consolidate the market share in the major segments of decorative paints, Industrial and automotive paints market. ICI paints business Pakistan has become an undisputed leader in the decorative motor and refinish segments of Pakistan¶s paint market. y With production of 14milion litres, ICI Pakistan touches the lives of painters, architects, paints retailers and home owners with color throughout the country. ICI¶s Dulux, Glidden, Maxilite and paintex brands have become as much a part of painter¶s vocabulary as color choice, quality; variety and durability are the criteria for the selection of the paints by the end-users. y ICI has consistently developed new and innovative areas of businesses, since its formation in December 1926, by the merger of four of the largest chemical companies in the UK. ICI today is a collection of world class businesses, many of them leaders in their sectors. They are strongly led, technologically sophisticated with healthy and sustainable long-term growth-prospects . y ICI¶s paints brands are some of the most successful in the world. It¶s starches and adhesives find their way into everything from foods to building materials, and from sports shoes to medical electronics. It¶s lubricants make vehicle transmission and fridges run smoothly, and the vital ingredients in many personal and household care products come from ICI. .



ICI brings together a family of businesses with an impressive record of innovation and an ability to meet the changing needs of an increasingly global marketplace. The Company has a range of over 50,000 products, more than 38,000 employees and over 200 manufacturing facilities in 55 countries throughout the world. .


ICI Pakistan Limited is a 75.81% owned subsidiary of ICI Plc, UK. It was set up as a public limited company in Pakistan in 1952. ICI¶s presence in this part of the world, however, predates the formation of the public limited company and indeed, Pakistan itself. The Khewra Soda Ash Company, a predecessor of ICI Pakistan Limited, set up a soda ash manufacturing facility in Khewra in 1944 with a capacity of 18,000 tonnes per annum. This facility was sited next to the salt range as rock salt and limestone; two key raw materials for manufacturing soda ash were available here in abundance.


ICI paints aims to delight and inspire customers to transform their surroundings at home and work with performance products and colors. With some of the world¶s top paint and decorative product brands, serving both the professional and DIY markets, ICI Paints has products to prepare and care for all building materials. The business also provides coatings for cans and packaging. Headquarters in the UK, with manufacturing in 25 countries:

y y y y y y y y y y

Architect Consultant and Design Engineers Quantity Surveyors Corrosion Engineers and consultants Steel Fabricators Painting Contractors Civil, Structural and site engineers Maintenance Engineers Interior Decorators At ICI they believe that their job does not stop at merely supplying the paints: is important to them as it is to the user that good results should be obtained from their products. We set great value to their technical Service Department, which is staffed by individuals of wide practical experience in the use of paint under all conditions. This experience is readily available to paint users requiring advice and assistance in the choice of paint to the preparation of painting specifications.


Supporting the technical Service Department is the Development Laboratory whose equipment and facilities are the finest of their kind in this part of the world. Here new and


established products are tested in both laboratory and fully practical conditions, using the widest possible range of application methods and equipment. y Their products are based on continuous research and product development carried out by their parent company ICI Paint Division UK. The information derived and results obtained by ICI Development Laboratory are readily available to them here. ICI is employing and putting into use best available technology in the world for their users. y y y y y y y y y y Some Facts and Figures 50 million households, all over the world, use ICI paints every year. Each year ICI Paints produces enough paint to decorate every house in all of Los Angeles, London and Beijing. ICI Paints makes enough paint to completely cover 2.8 million football pitches. ICI Paints produces 1.1 billion liter of paint which if in 1 liter cans placed on top of on another, would be 13,000 times the height of Mount Everest. ICI Paints sells to over 100 countries throughout the world. Over a third (35%) of ICI Paints¶ business is represented by new products introduced in the last five years. ICI Paints are used in countries which represent over 95% of the world¶s population. ICI Paints prides itself on being at the forefront of innovation: we employ 680 people worldwide in Research and Development. ICI Paints spends over £30 million per year on Research and Development worldwide.

The threat of substitute products y Although products such as distemper (choona), wallpaper, tiles etc are available but customers are not likely to substitute them for paints as it would compromise on quality and at the same time would not server the purpose. The growing share of companies in the unorganized sector provides a low price substitute.


The threat of the entry of new competitors y With regard to the paint industry in Pakistan, there is a high threat of new entrants. The main reason for this being low entry barriers, as there is no requirement of high capital investment to enter the paint business. Also, there are no proprietary product difference and low switching costs which puts the phrase ³brand loyalty´ into jeopardy.




y y

What make the paint industry attractive for newcomers is also the ease of acquiring skilled people, material and supplies. Moreover, lack of long term contracts also contributes towards the attractiveness of the industry for the newcomers. However, there are established brand identities as well as consolidated distribution channels to be accessed which would result in strong retaliation to be faced by the newcomers. Such is an example of Nippon who set up its business in Pakistan recently.

The Bargaining power of customers y Bargaining power of the intermediaries is high because the industry is divided into the structured and unstructured market and does not act as a unified whole to leverage the bargaining power in its favor. Therefore the more the channel sells each product, the higher the margin they keep for the company. The bargaining power of end users however, is low because there a large number of buyers, each with relatively small purchases. In addition to this, the organized paint sector has also accepted branding which creates loyalty and decreases the price sensitivity, resulting in low bargaining power of buyers.

y y y

The Bargaining power of suppliers y y Bargaining power of suppliers is low in the decorative segment as inputs required are commodities and there a number of suppliers available who are fighting for a small market. However, since big companies fight on the ³quality´ dimension and cannot switch their suppliers are in a position to negotiate their terms upon providing the desired raw material which makes the overall bargaining power of suppliers moderate.

The Intensity of competitive rivalry y y The paint industry can be characterized as a fragmented industry divided into the organized and unorganized sector. The unorganized structure is the biggest threat for established brands.

PAINT PRODUCT:level of the product Core benefits
The core benefit what a consumer is looking for? In paint products the core benefit is protecting the walls. The safety need is high concerned with the core benefit.

Basic Product:
ICI basic offering is a paint which gives protection and excellent glass retention on metal and wood services. It is also in form of liquid


Expected Product:
The customer expects the product to be protected and have excellent retention on surface. They also except that it should spread smoothly and easily while it should give reliability.

Augmented product:
ICI highest quality premium interior/exterior hundred percent acrylic glasses finishes is specially formulated to provide exceptional toughness and durability, easy application and quick curing resulting in a long lasting uniform finish. Dulux glass also provides excellent adhesion moisture resistance coverage and application resistance, courage and application properties when applied by brush, ruler and spray. It is ideal for use on properly prepared interior and exterior substrate such as wood siding trim and sash, shingles, weather aluminum, metal, dry wall and sound painted surfaces.

Potential Product:
The potential product encompasses all the possible argumentations and transformation the product or offering might undergo in future, the potential product ³fragrance base paint´. The will be give fragrance of different flowers and roses. The next augmentation can be launch product in plastic jar. Those will easy to use and less harm to the hands, while environment protection can be increased by the product, because customer may use the plastic jar after using the product. ICI Dulux is a brand of quality and its all products are quality products which are manufactured to compete with international paint products. But the Paintex products manufactured in order to compete with local low quality and low price products At this time ICI also working on the new products developments. .,

Products paints
1. Dulux Super Gloss Enamel 2. Dulux Metallic Finish Enamel 3. Dulux Matt Finish Enamel 4. Dulux Synthetic Enamel Fan Finish White 5. Dulux Pentalite Special Plastic Emulsion (Acrylic Based) 6. Dulux Pentalite Natural White Special Plastic Emulsion with Added Fragrance (Acrylic Based) 7. Dulux Contractor¶s Plastic Emulsion 8. Dulux Weather Shield (Acrylic Based) 9. Dulux Prime-on 10. Dulux Water Repellent 11. Dulux Synthetic Clear Varnish


12. Paintex Plus Emulsion 13. Maxilite 14. Dulux Red Oxide Anti Corrosion Metal Primer 15. Dulux Aluminum Paint Dual Pack

ICI today is one of the world¶s largest manufacturers of paints. With acquisitions in the Americas and Europe it produces and sells over a billion litres of paint annually. In 1965, ICI UK acquired a 50% interest in a paints company situated at Ferozepur Road, Lahore Pakistan and changed its name to Paintex Limited. In 1973 the new Company was converted into a Public Limited Company. The paints manufacturing capacity of the plant was upgraded and enhanced in 1981 and since then the Business has proceeded progressively to consolidate market share in the major segments of the decorative, automotive, industrial and refinish paints market. It has now become the undisputed leader in all the three segments. The Refinish and Industrial Businesses were recently divested by ICI Plc to PPG. However the agreement excludes the sale from the portfolio in Pakistan. Hence these businesses will continue to be retained by ICI Pakistan and will have the additional advantage by accessing support from the new parent. PPG is today among the World market leaders in Refinish and OEM businesses. Hence ICI Paints in Pakistan will enjoy the benefits of both the old ICI Autocolor umbrella and the new innovative edge of PPG through a licensing agreement and be able to further consolidate its position in both segments i.e Refinish and Industrial Paints. With production of nearly thirteen million litres, ICI Pakistan µtouches the lives' of home owners, architects, paints retailers and painters, with colour throughout the country. ICI's Dulux, Duco and Paintex brands have become as much a part of the painter's vocabulary as colour choice. Dulux is a premium quality brand which provides its users the key desired attributes of premium paints - a beautiful, durable and smooth finish. Dulux has a robust range of quality products which includes premium quality interior and exterior paint, enamel and primers. ICI Pakistan Paints has once again taken the initiative of providing the very best to its consumers by launching Master Palette, the most technically advanced tinting system that gives the consumer a choice of 6,134 discernibly different colours. From the brightest ambers to the softest pastels, from the coolest blues to the ripe reds, the Master Palette offers a plenitude of 6,134 colours to match every environment and mood.


The Paints Business accounts for nearly 20% of ICI Pakistan's annual turnover and contributes nearly 24% of the Company's profit. The impressive growth recorded by the Paints Business through aggressive marketing and refined brand management is a success story where the vital ingredient has been consistently superior quality and focus on customer satisfaction. By offering technical and free colour advisory service, ICI has set a high value on being able to advise and assist the customer about his needs for specialised applications, and resolving problems of technical specifications for the use of paints under varying conditions. Access to research and technical capability of ICI in the United Kingdom and worldwide, and Japanese collaboration and technology, often enables ICI Pakistan to serve the special needs of customers in Pakistan. The factory produces pre-treatment chemicals, conventional paints, chlorinated rubber paints, epoxy paints, heat resistant paints, automotive refinish paints, stoving paints and varnishes and Nitrocellulose based finishes. ICI Autocolor Business, a part of ICI Pakistan Paints, is a market leader in the manufacture of paints for cars and vehicles for their repair and refurbishment. Recently, the Company established a state-of-the-art Technical Training Centre for refinishes training, the first of its kind from a commercial enterprise in Pakistan. The Business has a comprehensive safety, health and environment programme that receives the highest priority to ensure that the Company complies with all regulations and meets ICI international standards, both internally and externally. The recent launch of the Product Stewardship Programme is a clear indicator that ICI Pakistan is committed to pioneering SHE initiatives in the paint industry in Pakistan. In 1998 the Paints business was awarded MRP (Manufacturing Resource Planning) II Class A for excellence in overall business operations. ICI Paints is the first company in Pakistan and 23rd in the world to be awarded MRP II Class A. ICI Paints is also the first paint company in Pakistan to receive ISO 9001 certification in all it's disciplines and it became the 3rd company in all of Pakistan to achieve the ISO 14001 certification for environmental management system. The achievement of MRP II Class A accreditation and ISO certifications is not only a reflection of commitment to excellence in service standards, customer satisfaction, safety, health and the environment but also in the pursuit of being among the world's best.


Decorative Paint
y y y y y Handy Tips for Color Scheming from Dulux Choosing the right color is not always as straightforward as you might think. When decorating is there any rules about choosing a color scheme? How does light affect the way we view color? Are there any simple tips for trying out the color without painting the walls?

Dulux Super Gloss Enamel
Dulux Super Gloss Enamel is a high quality solvent-based super gloss finish, suitable for use on all types of interior and exterior wood and metal surfaces. Dulux Super Gloss Enamel gives a smooth mirror like finish and has excellent durability. Generally resistant to heat up to 90 C, but some discoloration of light colors may occur at temperatures above 80 C. Resistant to the levels of atmospheric humidity present in normal interior and exterior environments and will withstand repeated washing. Not suitable for use on immersed surfaces. It can be applied through Brush, Roller or Conventional Spray and it is highly flammable.

Dulux Metallic Finish Enamel
Dulux Metallic Finish is a high quality solvent based super gloss finish, suitable for use on all types of interior and exterior wood and metal surfaces. Dulux metallic Finish gives a smooth finish and excellent durability. Generally resistant to heat up to 90 C, but some discoloration of light colors may occur at temperatures above 80 C. Resistant to the levels of atmospheric humidity present in normal interior and exterior environments and will withstand repeated washing. Not suitable for use on immersed surfaces. Spray is the only way to apply and it is highly flammable.

Dulux Matt Finish Enamel
Dulux Matt Finish Enamel is a high quality solvent-based matt finish, suitable for use on all types of interior wood, metal and masonry surfaces. Dulux Matt Finish Enamel has excellent resistance to steam and moisture, which makes it ideal for use in Kitchens and Bathrooms. Generally resistant to heat up to 90 C, but some discoloration of light colors may occur at temperatures above 80 C.


Resistant to the levels of atmospheric humidity present in normal interior and exterior environments and will withstand repeated washing. Not suitable for use on immersed surfaces. It can be applied through Brush, Roller or Conventional Spray and it is highly flammable.

Dulux Synthetic Enamel Fan Finish White
Dulux Synthetic Enamel Fan Finish White is a high quality, high gloss solvent based finish, suitable for use on all types of fans. It has good adhesion and resistance to mechanical damage. Generally resistant to heat up to 90 C, but some discoloration of light colors may occur at temperatures above 80 C. Spray is the only way to apply and it is highly flammable.

Dulux Pentalite Special Plastic Emulsion (Acrylic Based)
Dulux Pentalite Special Plastic Emulsion (Acrylic Based) is a high premium quality emulsion with a smooth matt finish. It is suitable for all normal interior masonry surfaces including brickwork, plastic, cement and wallboards. Will tolerate the levels of atmospheric humidity present in normal interior and exterior environments. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you.

Dulux Pentalite Natural White Special Plastic Emulsion with Added Fragrance (Acrylic Based)
Dulux Pentalite Natural White Special Plastic Emulsion with Added Fragrance (Acrylic Based) is a premium quality emulsion with a smooth matt finish, which contains fragrance. It is suitable for all interior masonry surfaces including brickwork, plastic, cement and wallboards. Will tolerate the levels of atmospheric humidity present in normal interior and exterior environments. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you.

Dulux Contractor s Plastic Emulsion
Dulux Contractor¶s Plastic Emulsion is a premium quality emulsion with a smooth matt finish, which contains fragrance. It is suitable for all interior masonry surfaces including brickwork, plastic, cement and wallboards.


Will tolerate the levels of atmospheric humidity present in normal interior and exterior environments. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you.

Dulux Weather Shield (Acrylic Based)
Dulux Weather Shield (Acrylic Based) is a high quality, 100% acrylic based emulsion for new or previously painted exterior masonry surfaces such as brickwork, plastic and cement fastness. Resistance to the levels of atmospheric humidity normally experienced in exterior environments. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you.

Dulux Prime-on
Dulux Prime-on is a solvent based sealer for interior and exterior masonry surface both new and previously decorated such as brickwork, plaster and cement. It reduces damage form alkali and salts and seals powder, porous surfaces. Not suitable where the surface is saturated. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you.

Dulux Water Repellent
Dulux Water Repellent is an excellent protective barrier against moisture for unpainted surfaces. It penetrates the surface and acts as an effective guard against water. It is suitable for brickwork, concrete, plastered surfaces, unglazed tiles and sand-cast surfaces. Dulux water Repellent is not recommended for surfaces in constant with water, like tanks to masonry surfaces below ground level like basement etc. It can be applied through Brush or Conventional Spray, which is convenient to you and it is highly flammable.

Dulux Synthetic Clear Varnish
Dulux Synthetic Clear Varnish from Dulux is a solvent-based varnish suitable for use on all types of new or previously treated wood and metal. Typically uses include paneling, cane or wood furniture, windows doors and partitions.


Dulux Synthetic Clear Varnish has a high gloss finish and has excellent abrasion resistance and is fast drying. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you and it is highly flammable.

Paintex plus Emulsion
Paintex Plus is an economical emulsion with a smooth matt finish. It is suitable for all normal interior masonry surfaces including brickwork, plaster, cement and wallboards. Will tolerate the levels of atmospheric humidity present in normal interior and exterior environments. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you.

Maxilite Economic Wall Paint:
Maxilite Economic Wall Paint is an economic water based paint that has excellent coverage and provides a smooth matt finish. It is suitable for all normal interior masonry surfaces including brickwork, plaster, cement, asbestos and wallboards etc. Will tolerate the levels of atmospheric humidity present in normal interior and exterior environments. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you.

Dulux Red Oxide Anti Corrosion Metal Primer
Dulux Red Oxide Anti Corrosion Metal Primer is a solvent-based sealer, anti-corrosive protective primer for interior and exterior ferrous and non-ferrous metalwork including steelwork, new weathered and pre-treated aluminum. Can be used on heated surfaces up to 90C. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you.

Dulux Aluminum Paint Dual Pack
Dulux Aluminum Paint Dual Pack is a silver paint with high metallic luster, which protects the surface from corrosion, discoloration and the effects of heat. Typical uses include chimneys, pipelines, storage vessels, steam pipes, machinery surfaces, oven doors and heat exchangers. It can be applied through Brush, Roller or Conventional Spray, which is convenient to you and highly flammable in nature.

ICI Pakistan was a pioneer in the PSF industry, which it entered into in 1982, with the commissioning of a 12, 000 tpa plant at Sheikhupura, at a cost of Rs 630 million. Successive expansions thereafter have brought polymerization capacity to 91,000 tpa (1997), which includes


60,000 tpa PSF capacity. The most recent expansion was at an estimated cost of Rs 3.2 billion, using DuPont technology. PSF is blended with cotton and other manmade fibres such as viscose and acrylic to produce blended yarn. The future outlook for PSF demand is optimistic, based on factors including: ‡ ‡ ‡ ‡ ‡ ‡ A growing local population; Limited cotton acreage; One of the lowest PSF per capita consumption rates compared to the South East Asian region as well as the world; Expanding export demand for higher value added textiles; A large spinning industry; Government incentives for blended textiles.

Subsequent to the second capacity expansion, ICI Pakistan set up a wholly owned subsidiary, ICI Pakistan PowerGen Limited in 1993, a 14 MW power generation plant, in order to ensure an uninterrupted power supply for smooth plant operations and meet its increasing demand for power. ICI PowerGen, in addition to meeting the power requirements of the Polyester Plant, also provides power to other industrial customers in the vicinity. The Polyester Plant produces premium grade polyester staple fibre, with the brand name, Terylene, which has a national image of consistency and quality. Further commitment to international standards was proven by the Business¶ ISO 9002 certification in 1999. ICI Polyester takes pride in its professional relationship with customers and has proven time and again to be a responsible supplier, adhering to business principles and code of ethics. ICI Polyester is conscious of its social responsibility, and participates in community welfare projects in areas surrounding its plant. The Polyester plant at Sheikhupura was also recognized for its environmental consciousness when the WWF survey confirmed existence of a number of rare species of plant and animal life on the plant site.


ICI Polyester remains committed to the Textile Industry of Pakistan and believes in continuous improvement in all aspects of the Business to benefit its customers. The ICI Pakistan Polyester Fibres business is a customer-driven business, providing a consistently high quality of product and after-sales service. In view to the growing demands for value-added/specialist products, ICI¶s Polyester Fibres business has expanded its product portfolio providing their customers with a distinct edge over their competition. These products include

Standard 1.2 Denier Semi-Dull PSF
catering to all sectors of all the domestic PSF market. This product is specially known for its strength, consistency and superior dye uptake.

SCD Single Component Dyeing
Caters to PC hosiery yarn export market; eliminates white polyester spots when only cotton portion is dyed.

SDOB Semi Dull Optical Bright
Fabric produce from this product gives an outcome that is distinctly bright/white in appearance catering mainly to the North American Market. The product can be woven and knitted and is also used in dyed and printed form in the Home Textile segment

· EHT Extra High Tenacity
Caters to the requirement of the sewing thread industry and with a tenacity of 7.5 gpd +

· Super Bright
Product with Super Brightness to cater for broad-spectrum usage.

· Low Pill
Minimizing pilling when fabrics are subjeced to heavy industrial wshing.

· Denier Microfibre
Fine Denier product to improve both yarn strength, output and quality.


Soda Ash
The Soda Ash Plant is located in the northern part of Punjab at Khewra, District Jhelum. The initial work of setting up a soda ash plant at Khewra site dates back to 1929, however, commercial production began in 1944. The original capacity of the plant was 18,000 tonnes per annum that has increased to 200,000 tonnes per annum through a number of expansion projects. The plant is currently meeting about 80% of the Country's requirement for Soda Ash, and by using locally made equipment and raw materials, provides savings to the Nation's foreign exchange reserves. Soda Ash is an essential raw material used in the manufacturing of Glass, Detergents, Caustic Soda, Soap, Paper, Textile, Water Softener, Petroleum, Washing and Laundry Soaps. The major raw materials used in the manufacturing of Soda Ash are Salt, Limestone and Coke. Salt and Limestone are locally available at Khewra, in abundance, whereas Coke is procured from the Pakistan Steel Mills, Karachi. Other essential requirements are Natural Gas, Furnace

Oil, Ammonia and Water.
The product range was diversified in 1995 with the commissioning of a 10,000 MT Refined Sodium Bicarbonate Plant. The basic raw materials for its manufacture are soda ash and carbon dioxide, both of which are available at the Khewra Works. The Soda Ash Business strives for continuous improvement of its already excellent SHE record. This commitment is demonstrated by the prime position given to SHE in all aspects of Business operations, and the programmes in place. In 1998, ICI Pakistan was the joint winner of the Chief Executive's Safety Award through the Soda Ash submission of µSITARA', safety through teamwork. The quality initiative was first introduced at the Soda Ash Business in 1985 with a fundamental part of µTotal Quality' being the implementation of management systems based on the principle of prevention. Subsequently, the process of Quality Improvement Teams was introduced, which improved the quality of the products and operating efficiencies. Currently, the Business is working to implement International Quality Standards (ISO-9002) in all areas of its activities.


The Soda Ash Business employs 550 permanent Staff and has 2500 people who work as Contractors and Suppliers. Most of the permanent employees are provided housing facilities on the Company's well developed residential estates. Other facilities like the Winnington School,

Alkali Sports Club, Winnington Club,
hockey & football grounds, squash courts, 20 bed Winnington Hospital, with a full time Medical Superintendent and a Lady Medical Officer supported by visiting specialists and a well trained paramedical staff, are also availed by the employees. As part of its community development initiatives, the Business routinely extends support to local schools, colleges, parks and other institutions in the area.

The ICI Pakistan Chemicals Business comprises of a unique and diversified portfolio encompassing Uniqema, Polyurethanes, and a Trading concern that includes representation of ICI Businesses, such as National Strach and Chemical, Chlor Chemicals, Synetix, Crosfield and as well as former ICI Businesses such as Tioxide, supplemented by imports of complementary product lines from non-ICI companies in the USA, Europe and Far East. The Business markets a diversified product range used for various applications by nearly every industry in Pakistan, prominent amongst which are textiles, paints, pharmaceuticals, personal care, food & beverage, detergents, footwear and household appliances. In June 1999, ICI plc completed the sale of its Polyurethanes and titanium dioxide (Tioxide) business to Huntsman Corporation, USA. ICI will, however, retain a 30 percent stake in the above businesses, for a minimum of three years, through a new company Huntsman ICI Holdings, which will be 60 percent owned by the US company and remaining 10 percent by financial institutions. This divestment excludes ICI's interest in Polyurethane and Tioxide in Pakistan and as such ICI Pakistan retains these businesses within its portfolio and will continue with them with full support from Huntsman. As Polyurethanes will be a core business for Huntsman, ICI Pakistan expects to have more focused resources available for business development.


The Uniqema Business at ICI Pakistan includes the manufacture and marketing of textile auxiliaries, adhesives and paint lattices, and the trading of personal care products to a wide range of industries. The Uniqema plant at Karachi was primarily designed to manufacture a range of textile auxiliaries. Today, with a capacity of 4,000 tonnes it manufactures and formulates a range of over 60 products used in industrial processing that call for Specialty Chemical applications. The products manufactured include textile auxiliaries for applications in preparation, dyeing and finishing of fabrics, PVA based lattices for paints, PVA based adhesives for the woodwork and packaging industries, and products for supply to end users in the jute, leather and paper industry.

For Polyurethanes, ICI Pakistan has its own blending unit with an installed capacity of over 2,000 MT/ annum with three shifts operation. It produces rigid Polyol, which is one of the two components used in thermal insulation of appliances and panels for cold storages. The various industries that the Polyurethanes Business caters to are appliances, construction, footwear, transport and furniture. PU chemicals are also used in chemical plants and animal houses such as poultry sheds, etc. Apart from local blending, PU chemicals are also sold on direct indent and ex-stock basis for different applications. In PU, ICI Pakistan is the market leader, in all major SBU's, with an overall share of about 63%. Polyurethanes will spearhead Huntsman/ICI's strategy to expand downstream into more specialised markets by offering globalisation and diversity. Since PU is a core business for Huntsman, more resources will be available for its development in Pakistan.

The Business handles a diversified product range from specialised chemicals used for water treatment to basic commodity chemicals used in a variety of industries including fertilizer, cement, polyester, oil and gas, plastics and paints. These products originate from ICI companies worldwide and from non ICI companies globally for whom the Business acts as agent. The products are sold both on ex stock and indent basis directly to the customers or through commercial importers/distributors to achieve a wider market coverage.


The products offered by this SBU of the ICI are as follows:

ICI Pakistan's Pharmaceuticals Business markets prescription drugs with a strong portfolio of innovative medical products from Astra Zeneca Pharmaceuticals UK. A focused portfolio of products is at present maintained, with strong representation in the cardiovascular, oncology and anaesthetic segments. The product range consists of Tenormin, Inderal, Zestril and Etizem (cardiovascular); Nolvadex and Zoladex (oncology); Diprivan (anaesthesia); Proxen and Synflex (NSAIDs) and Meronem (antibiotic). ICI Pharmaceuticals' strength is in cardiovascular drugs with Tenormin, a product used for controlling hypertension and the market leader in its therapeutic segment. In addition, Inderal, Zestril and Etizem complete a comprehensive portfolio of cardiovascular drugs, meeting the needs of treatment required to be given to patients. ICI Pharmaceuticals also specialises in drugs for the treatment of cancer. Presently, the product portfolio consists of Nolvadex, used for the treatment of breast cancer, and Zoladex, an advanced technology drug used in the treatment of prostrate cancer. Future expansion of this range will result in new therapies being introduced to further broaden the availability of cancer treatments in Pakistan. ICI Pakistan Pharmaceuticals imports finished products and also uses toll manufacturing facility for local manufacturing from imported raw materials. At present the Business, including its Animal Health division, has a staff strength of over 120 personnel, located across Pakistan.


The products being offered by the Pharmaceuticals division are:
CARDIOVASCULAR, Tenormin Tenoret 50, Zestril, Zestoretic, Inderal, Etizem, ONCOLOGY, Nolvadex Zoladex, Arimidex, Casodex, NSAIDS, Proxen Synflex, ANAESTHETIC, Diprivan (EDTA), ANTIBIOTIC, Meronem, CNS, Zomig Seroquel, ANTHELMINTIC, Ketress, GASTRO-INTESTINAL, Etipro, RESPIRATORY, Accolate,

The Animal Health Business of ICI Pakistan is involved in the marketing of veterinary medicine for use on livestock. The portfolio consists of animal health products from Schering-Plough Animal Health Corporation. Products in the locally formulated category are liquid formulations of Nilzan, Nilverm, Zanil and Systamex, and the Business imports specialised products for direct

sale in the market.
ICI Animal Health has the largest market share of the livestock market segment in Pakistan, and its products are respected in the industry as market leaders. The Business acts principally as a selling unit employing 27 staff stationed in key regions of Pakistan, to allow focused selling to farmers and government institutions.

The products offered in Animal Health division are:
NTHELMINTICS, Nilverm Nilzan Nilzan Bolushttp Zanil Systamex Oxfenda SC Endectin, INTRAMAMMARY, Spectrazol, ANTIPROTOZOALS Butalex, Imizol, ANTIBIOTIC, Amoxivet, VACCINE, Decivac FMD, INJECTABLE, Somatic, PURE TEREPHTHALIC ACID,



The obvious pricing objectives of ICI Dulux are 1 Maximization of Profits 2 To achieve the target return and targeted sales 3 Maintain the Market share. As far as the pricing is concerned it is the most difficult decision because keeping all the things on one side price matters. ICI Paints is promoting different brands on different prices according to the market segmentation. Dulux is the most expensive brand in the market. The reason is that the best raw material and components are used in the manufacturing of the Dulux. Second reason is that Dulux target market is upper tier. And to some extend upper tier of middle tier. But paying more for Dulux, customer feels value.

The pricing method adopted is profit based. A target about the profit percentage is decided, after assessing the net cost, profit is added to it to determine the price. Since ICI Dulux is the Market Leaders they can easily manipulate prices. The changes in the prices are decided in the Head quarters and the dealers are informed 15-20 days before the price are actually increased. This strategy has a dual effect, on one hand the price is increased and on the other it helps in blooming sales. It acts as a promotional tool because dealers pick up their stock with no delay and they purchase more than the usual bulk. It is also beneficial for dealers because then they sell their old as well as the new stock on the latest high prices and hence receive a greater profit. If we compare the price of Dulux with other local brands, it¶s the fact that price difference is not more than 20-100 rupees. As far as quality is concerned, by paying more customers is not worried about the quality. For the market which is middle tier, ICI¶s brands Paintex Emulsion and Glidden are the brands with low price and optimum quality within the tier. If we go into the comparison of Paintex and Glidden their price is lower than the other paint brands selling in the market. Glidden is purely priced to cover the buying power of middle tier.


The price of the products in which ICI is having technological edge over competitors is comparatively high. The reason is that ICI is enjoying state of monopoly for that product. There is no product in the market to encounter them. The price of Dulux Weather shield Fresh is Rs. 1050/-, others companies brands offered in the market are 300-400 Rs less than Weathersheild Fresh. Same is the case with Dulux Gloss Finish and Dulux Matt Enamel Odorless Range. The price is Rs. 300-400 more as compared to other brands. So pricing factor vary from brands to brands and target market.

Placement of ICI Paints
³Place includes company activities that make the product available to target consumers.´ Placement is the process in which the final good or service is made available to the end Customer .The channels used for this purpose are known as ³Marketing Channels´. Marketing channels are defined as ³set of independent organization involved in the process of making a product or service available for the use or consumption by the consumer or business user´. The overall ICI Paints products are manufactured in ICI Paints Lahore. For all Pakistan stocks Dispatch is carried out from factory warehouse. There are further 5 warehouses in the country. · LAHORE · ISLAMBAD · MULTAN · KARACHI · QUETTA The distribution channel includes Distributors and Dealers/ retailers. The Pakistan is divided into 3 regions. · Upper PUNJAB · MIDDLE PUNJAB · LOWER PUNJAB Every region is headed with Regional Sales Manager and in every Region there are further Area/ Territories. The supply activities are carried out with keeping the region and areas. One region cannot carry out supply in others region same in the case with areas/ territories. The product is only delivered to the company approved dealer or distributor. Distributor can sale to the customer which is not approved dealers of the company. Main consumption of paint is on


dealer/retailers counter. The delivery is made through 2 modes · Distribution Vehicles · Freight On Road ( goods transportation service) By these 2 means ICI manage the distribution and placement of their products to be available for Their customers and consumers

ICI Dulux has certain requirements after these requirements are fulfilled a dealer is registered and is legally allowed to start the distribution. 1 Special accounts with Dealer¶s Code (DC) are opened in the computer; 2 A promissory Note is signed; 3 Dealers have to sign a blank cheque for security; 4 Dealers have to submit a copy of their Identity Card (ID card) and a few more documents; 5 After this they are registered as ICI Dealers. Most of the distribution and trade is done on cash. Lahore and Karachi are advance payment markets where as Multan and a few other small cities have a credit market. Transportation from Lahore i.e. the production site is done through trucks and railway. Transportation within the city is done by trucks in large cities and by donkey carts in smaller cities. Even in Multan most of the transportation is carried on the donkey carts.

Channel Distribution:
Intensive distribution stratgy is used by ICI paints,where the majority of resellers stock the 'product' with convenience products, for example, and particularly the brand leaders in consumer goods . A distribution channel is the method a company uses to get its products into the marketplace for consumer use. The traditional channel goes from supplier, manufacturer, distributor, wholesaler and retailer. Two types of distribution channels exist: indirect and direct.As ICI uses indirect distribution channel in order to provide product to the customer

Indirect Channel Methods
Distributors, wholesalers and retailers are the primary indirect channels a company may use when selling its products in the marketplace. Companies choose the indirect channel best suited


for their product to obtain the best market share; it also allows them to focus on producing their goods

Promotion of ICI Paints
ICI Paints is using following promotional tools: Customer satisfaction is itself a promotion tool for ICI Paints and it help to develop C2C relationship. ICI Paints arranges painter parties at different places and at this event gift are given to those painters which have used a reasonable quantity of ICI paint for the period. ICI Paints has given a target to every dealer according to its capacity and market analysis. If that dealer meets that target, ICI Paint will take that dealer to some other country for recreational purpose e.g. last time ICI Paints chartered special plane for its dealers and took them Dubai. For present year ICI Paints has promised to take its dealers to Malaysia. Just like other paints ICI has offered a token in every Bucket or Gallon of Maxilite and Paintex which are worth Rs. 220 per Bucket and Rs. 60 per Gallon. The company is promoting its product through the following modes · Advertisement · Public Relations · Sales Promotion · External Communication · Events And Exhibitions · T.V Advertisement on different channels · Radio Advertisement , F.M 100 · Bill boards almost in every big city · Posters / Banners · Small gifts for dealers/distributors to push new product sale · Small gifts for painters / contractors who are labor force who apply paint · Painters party to introduce them new product · T ± Shirts printed with product logo on them · Caps · Key chains


The company many warehouses in different places like · LAHORE · ISLAMABAD · KARACHI · QUETTA.

As ICI Dulux has a diversified market it has to use a number of promotional Tools.


Television Advertisement
It is a very expensive tool of promotion but it is worth it. ICI Dulux though still advertises through Television commercials but it has reduced its intensity. They just use it to create awareness among their target market about a certain product and try to highlight its main selling features. Now a day the Television commercial of the ICI Dulux plastic emulsion can be watched which emphasizes the 6134 shades it has.

Radio Advertisement
It is a relatively cheaper source of advertisement and due to various FM channels; the number of listeners has increased. Therefore Dulux finds it effective to communicate with its customers through radio. But these FM channels advertisements can only be found in Karachi and Lahore. Recently ICI has renewed its advertisement contract with FM-100 Lahore.

Print Advertisement
A substantial part of Dulux¶s total promotional expenditure goes under this head. Approximately all the good and standard magazines carry the advertisement of ICI Dulux.

Point Of Purchase Advertisement
Many colour cards, brochures and other informative material is available at dealers shop along with the product itself in attractive cans. The dealers display contest is another kind of advertisement.New dealers are registered where intensive contraction is being done.


Out Door Advertisement
In out door advertisement Dulux mostly uses sign boards and they are placed at busy areas where maximum people can see it.

Free Dulux Colour Advisory Service They say ³for our valued customers, expert help is available through a creative color consultancy service provided free of charge. Our color Advisors would be available to develop innovative color schemes to bring out the best in your home.´ This is the most important promotional tool and helps to generate maximum demand. TTF (Trained task force) is a trained mobile team which reaches at the place where construction or revocation is being done, just on a single phone call. They sometimes reach at the point of construction or renovation with our being called and give the customers free advice. Another mobile service available is the LCA (Lady color Advisory Service) where innovative and creative ladies give advice about the color scheme of the house. If the customers have any kind of problem or complaint the mobile teams are always there to help them.

Sales promotion is also a very important promotional tool used by Dulux in which different short term and long term incentive schemes are offered to the dealers. Sometimes the company provides the dealers with extra discount if they sell up to or more than a target amount preciously decided. Dealers are sometimes also given small incentives like T-shirt, wall clocks, folders, brochures, pen holders etc in return of the sales promotion.

Promotional strategy:
ICI has taken many steps to promote its paint products. ICI uses multiple techniques under the promotional strategy. y Word of mouth through its sales representative y Publicity e.g. recent float truck activity is the part of publicity y ICI gives free samples to its different customers. Recently ICI give free sample to many hotels for the purpose of the promotion. y ICI offers discount to increase the no of dealers. y ICI offers a token system in the Paintex paint box in order to attract more and more painters. y ICI gives the prizes to the painters to increase it sales.



ICI gives the SINGAPUR return ticket to the most leading dealers for the purpose of encouragement of more sales.

Ici Pakistan brand element:Brand names URLs Logos and symbols ICI Pakistan



POD | Points of Differentiation:
History Variety Innovation in product offering Distribution and inventory management Committed Sales force

POP | Points of Parity:
One of the early entrants in the world Durable and quality product


vast product field




Salience: Quality, Range, environment friendly Performance: Variety of products as per specific customer need Judgement: Quality at a price Reputation: New Entrant Feeling: high rate of customer Satisfaction Resonance: Market expansion and loyalty factor

ICI paint is the largest paint industry in Pakistan. The company is holding a position of market leader in the market. The company has highest share in oil and paint market in Pakistan. ICI paints have got the latest technology with them as compared to their competitors. Their production process is highly automated. They can offer any color as demanded by the customer. Customers can ask for any of 6134 colors. For every shade of color there is a specific formula that states about composition of constituents and their proposition. High level of automation is one of the critical success factors of ICI that differentiates then from their competitors and serves as a source of competitive advantage.


Competitor analysis
ICI is the largest paint manufacturing company in Pakistan. The company has hundreds of competitors in open market, but they have little share in total market. Mainly there are two main competitors of ICI paints i.e. Burger paints and Master Paints. Other competitors include the following: 13 Nippon paints Diamond paints Silky paints Bright paints

ICI PAINTS 25% BERGERS PAINTS 12% MASTER PAINTS 3% SILKY PAINTS 1% All other companies have fewer shares as compared to the main competitors.

Marketing and Business Strategies
In order to better understand how to increase the market share of ICI paints, we have to position the brand with its direct competitors. That is best demonstrated with the help of the BCG matrix. BCG Matrix The BCG matrix categorizes brands according to two parameters, the rate of market growth and the relative market share. There are four categories under which brands may fall: y y y y Star: High market growth & high relative market share. Cash cow: Low market growth & high relative market share. Question mark: High market growth & low relative market share. Dog: Low market growth & low relative market share.

The market positioning of ICI paints and its direct competitors is shown in the diagram below. As it can be seen ICI paints has high market share and high relative market share, therefore it is categorized as Star.











The purpose of the BCG matrix is to help devise a strategy in order to help resolve the problem of increasing the market share from 60% to 70%.

Strategies under BCG matrix: The various strategies available to improve the market position of a brand are as below: y Differentiation Strategy: Differentiation strategy is that the company differentiates its products or services to those of other companies. y Cost Leadership Strategy: Under this strategy the product or service is provided at the lowest possible cost so that it higher margins may be earned by the company. y Focus Strategy: This strategy gives importance to focus on the customer/ target market; identifying and serving them better.


ICI paints is at present following the differentiation and focus strategies. Although controlling costs is an important matter, ICI paints does not believe in comprising its quality. That would be detrimental to its leadership position in the market. Also the number of household users is greater than the number of corporations within the country and contractors always use the brand demanded by their consumers. For this reason the brand employs differentiation and focus strategies. These strategies suit the present situation of ICI paints and therefore should be continued.

Push Strategy
PushStrategy is used by ICI in order to increaser their market share ad in order to create percpetion in the mind of the customers .A strategy was developed to provide for customer pull and merchant push through an integrated mix of front and back of house promotion. This route was chosen to encourage staff recommendation and customer choice and this Push strategy promote brand switching, creating trial and repeat purchase of productA back of house promotion was created to challenge branches to compete on a regional and national level with each other whilst a front of house promotion rewarded customers for purchasing across a range of products above a certain value, offering them the chance to win a range of prizes instantly.

Persolized marketing:
ICI company no doubt are the gaint in the entire market but they have to build relationship with the customer in rder to increase their share and equity in the market. ICI paints are more concern about their interaction with the customers. Personalized marketing is an extreme form of product differentiation. Whereas product differentiation tries to differentiate a product from competing ones, personalization tries to make a unique product offering for each customer.As for creating awareness in the cutomer about the product charactersitis, ICI also personaly contact their clients and their customer for the innovation and additional feature in the product . They do proper market survey and incur a major chunk of expenses for the prodcut promotion.

One-to-one marketing
refers to marketing strategies applied directly to a specific consumer. Having a knowledge of the consumer's preferences enables suggesting specific products and promotions to each consumer.As ICI is directly dealing with the customers and to their liking and disliking. Aas all the production process is directly link with sale. If the brand equity is not present in the customer so how a brand will be successful in the market. If ICI fails in the market no retailer and


distributor are going to place their product on their shelf. One-to-one marketing is based in four main steps in order to fulfil its goals: identify, differentiate, interact and customize. Identify: In this stage the major concern is to get to know the customers of a ICI, to collect reliable data about their preferences and how their needs can best be satisfied. Differentiate: To get to distinguish the customers of ICI in terms of their lifetime value to the company, to know them by their priorities in terms of their needs and segment them into more restricted groups. Interact: In this phase it is needed to know by which communication channel and by what means contact with the client is best made. It is necessary to get the customer's attention by engaging with him in ways that are known as being the ones that he enjoys the most. Customize: It is needed to personalize the product or service to the customer individually. The knowledge that a company has about a customer needs to be put into practice and the information held has to be taken into account in order to be able to give the client exactly what he want

Entering New Market Segments
As we have already discussed that ICI always believe in high quality premium products. But if we carefully examine the market then we come to know that there is a very large segment present in the market that are price conscious and therefore they are using the paints of some Mushroom Companies. In this situation management of ICI decided that they have to enter in this market also so they introduced an economical paint for this segment as well with a little compromise on quality with a slightly higher price than the mushroom companies.

Winning Competitors Customers
They are also trying to win the customers of their competitors through different techniques which are discussed in detail under promotion heading. Product Modification Strategy


ICI has also applied this strategy by introducing new colors quite often. They are also having a very colorful website on which you can choose the color of your choice and can get online suggestions and advice as well.

Most of the products are in maturity stage and just a few are in the growth stage e.g. Dulux Once.

Dulux is renowned for its superior quality and in Pakistan too, its quality is the best. Continuous product research and development, with input from vast international laboratory network, backed by consumer research (finding out what customers need and want) keeps them above the competition.

The company¶s trade name is combined with individual name of the products e.g. 1 Dulux Once 2 Dulux Synthetic Enamel 3 Dulux Pearl Glo 4 Dulux Primer On Dulux Weather shield had become so popular that ³Weather shield´ has become a generic name for weather protective paints. They also have their special color and brand codes.

The paint is available in plastic containers (Dulux Pentalite Special Plastic Emulsion, Weather shield) as well as Tin containers of different sizes. Almost all the packaging is done at its production site in Lahore.

A change in the product design is the available of perfumed/ fragrance finishes of which has attracted those customers who get irritated by the smell of the paints and solvents e.g. Dulux Pentalite Natural Whites. But there are no continuous changes in the product design.


ICI Dulux offers a wild range of colors as that is the soul of the paint. They have developed beautiful shades and shade cards. Dulux Master plate plastic Emulsion has 6134 shades and has huge beautiful shades card which is it self very expensive.

ICI Dulux does not compromise on quality. About 99.5% of its raw material is imported and a strict check on quality is maintained. It is because of its high quality and durability that people buy it even at high prices and it has captured 70% of the market share in Pakistan.

ICI provide their products only to the dealers (registered) which in turn serve to the various market segments, which are as follows: 1 Painting Contractors 2 Architects 3 Construction companies 4 Consumers.

The Target Market of ICI Paints consists of two types of customers: · Quality Conscious (Upper Class or Elite Class) · Price Conscious (Upper Middle Class and Lower Middle Class) And these students also want to get education, so the basic segmentation of ICI Paints is on the basis of social class (Psycho graphic Segmentation). For quality conscious customers ICI Paints offers D-Line products or Dulux and for price conscious customers ICI Paints offer Non-D products. This aspect tells us about the difference between luxury and need.


ICI Dulux is having a wide range of products that fulfils the needs of all type of customers, yet its main focus in on the upper/elite class and the upper middle class. Comparatively little emphasis is made on the lower middle class and further down in the market. Industrial customers are also included in their target market. ICI has infact categorised its customers into three categories. 1 Category A 2 Category B 3 Category C Category A constitutes the elite / higher class and category B constitutes the upper middle class. Both of these categories include the people who can easily afford the paints (highest quality) of ICI Dulux. Therefore these two categories get the most importance Category C is of the middlemiddle and lower-middle class which usually afford the normal/average quality paints of ICI Dulux. Therefore they define their Target Market according to the class categories and not through territories.

P s of ICI Product of ICI Paints
According to market point of view the product of ICI is: · Customer Satisfaction · Safety and health (For everyone which is directly or indirectly related to the company)

Position of ICI Paints
ICI is the leading company in the Pakistan as well world. It has 76% market share in Pakistan and ICI Paints are used in countries which represent over 95% of the world¶s population. So ICI Paints is not only market leader of Pakistan but also world¶s leading company in the business of Paints.

Price of ICI Paints
ICI Paints price is very reasonable when we compare with the benefits or offering of ICI. Some people think that paints of ICI are costly but keep in mind quality is free.


Promotion of ICI Paints
ICI Paints is using following promotional tools: · Customer satisfaction is itself a promotion tool for ICI Paints and it help to develop C2C relationship. · ICI Paints arranges painter parties at different places and at this event gift are given to those painters which have used a reasonable quantity of ICI paint for the period. · ICI Paints has given a target to every dealer according to its capacity and market analysis. If that dealer meets that target, ICI Paint will take that dealer to some other country for recreational purpose e.g. last time ICI Paints chartered special plane for its dealers and took them to Dubai. For present year ICI Paints has promised to take its dealers to Malaysia. · Just like other paints ICI has offered a token in every Bucket or Gallon of Maxilite and Painex which are worth Rs. 220 per Bucket and Rs. 60 per Gallon.

People in ICI Paints can be divided into following categories:
Management Staff:

Management Staff is being used for decision making process and if there is any problem occurs to the company.
Non-management Staff:

Non-management Staff includes Sales Promoters, IT persons and other contract based staff. Process ICI Paints is customer centric company so the process starts from the need or desire of customer and ends at the delivery of products or finished goods.
Physical Evidence

The physical evidence of ICI Paints is its production unit, Decorative Department and Color Studio which are easily accessible to the customer at any time.

3 C s of ICI Paints
· Consumer · Competitor · Corporate

The consumer of ICI Paints is any individual which has desire for the paint and requires cost beneficial product.


The Biggest competitor of ICI Paints is Berger Robilac; it is local company which is being run by the Big Investors in Pakistan.

ICI Paints management is it¶s corporate and management of ICI Paints is consists of marketing and HR managers which basically belongs to Pakistan.

Environmental Policy

Dulux Decorative Environmental Policy
ICI Paints is part of Imperial Chemical Industries plc and is one of the largest and most successful paint companies in the world. The UK Decorative Business manufactures a full range of interior and exterior surface coatings for the Trade and Retail markets and is well known for its Dulux Brand. ICI Paints has been committed to reducing the environmental impact of its products for many years.

It is ICI¶s policy to ensure that all its activities worldwide are conducted safely; the health of its employees, its customers and the public will be protected; environmental performance will meet contemporary requirements, and that its operations are run in a manner acceptable to the local communities. The Dulux Decorative Environmental Policy underlines the ICI Group Policy and in addition focuses on some key areas of work, where we are committed to improving our environmental performance. These key areas are:

Decorative Products
ICI policy states that it will strive to develop new products and containers that have minimal impact on the environment whilst maintaining its quality performance standards.


One of the largest environmental effects of painting is the solvents which are given off during the painting process. These solvents can cause adverse health effects (if used in poorly ventilated areas) and can contribute to pollution in the lower atmosphere. Much of our Research & Development work is targeted at reducing the solvent content of ICI paint products and offering water-based alternative products. Our objective is to limit the amount of solvent in the products ICI sells and reduces these limits over the coming years. ICI is also taking initiatives to reduce the environmental impact of its containers.

ICI policy states that it will provide its customers with clear, accurate and helpful information on environmental aspects of its products, including guidance on safe storage, handling, use and disposal. ICI provides comprehensive safety, health & environmental information on the back of all its containers, as well as advice on how to use the product. Further information and guidance is given in the Dulux Color Cards, which are available instore, which are available free from the Dulux Advice Centre at Slough.

ICI will take practical steps to ensure its product manufacturing and distribution processes are carried out to minimize their impact on the environment. ICI Pakistan is working with the rest of ICI to meet its main objective of reducing the waste from its factories.

ICI will work with its suppliers to minimize the environmental impact of their own business and manufacturing activities. A program for assessing the environmental performance of ICI key suppliers is in place.

Within Dulux ICI feels it is important for its own employees to be able to contribute to its environmental performance. It is ICI Paints policy to ensure that all personnel receive appropriate training and information on environmental issues and that they are aware of and understand our Environmental Policy.


ICI is using Water-Based Paints for Environment
Water-based paints are now recommended as the best choice for interior use on large surface areas such as ceilings and walls. Water-based emulsion paints such as Vinyl Matt, Soft Sheen and Silk have been available for many years now. One can now buy water-based gloss and satin finishes as well as a special Kitchen and Bathrooms paint. There are also water-based natural wood finishes available such as Dulux Quick Drying Varnish and Timber color. µWater-based paints have become much more widely available over the last few years. Alongside this development manufacturers now recommend restrictions on the use of solvent-based paints inside. All Dulux solvent-based paints that are intended for DIY use clearly state that the product must not be used on large interior surface areas such as walls and ceilings. Previous advice was to keep doors and windows open during application and drying. Recent evidence has shown that even with the doors and windows fully open the smell from the paint can still reach a level that is uncomfortable. The smell from solvent-based paints is caused by the solvent used in the paint (white spirit) evaporating into the atmosphere as the paint starts to dry. If there is not enough fresh air getting into the room to ensure that the solvent vapor is dispersed you will be breathing in more solvent vapor than is good for you, which may cause you to suffer from running eyes, headaches and nausea. This makes decorating unpleasant. Therefore ICI recommends that only water-based paints are used on large surface areas inside. When solvent-based paints are applied to smaller surface areas such as doors, skirting boards and windows, or when used outside, solvent vapor does not present a problem providing the paints are correctly applied in accordance with the can instructions, which give guidance on good working practice. Solvents or Volatile Organic Compounds (VOCs), from paint can contribute to summertime air pollution. It is therefore sensible to restrict their use to areas where they are really needed. Dulux has always had a commitment to offer the best possible choice of high quality products with clear guidance on their safe and effective use. ICI objective is to limit the amount of VOC in our products and reduce these limits over the coming years. As part of the Paint Industry¶s Environmental Policy, a labeling scheme has been introduced on paint cans to give consumers more information about the level of solvent in paint. All Dulux paints are labeled with the appropriate VOC symbol for the product:


Code of Corporate Governance

Compliance with the Code of Corporate Governance
As required under the Code of Corporate Governance dated March 28, 2002 the Directors are pleased to state as follows: The financial statements, prepared by the management of the Company present fairly its state of affairs, the results of its operations, cash flows and changes in equity. Proper books of account of the Company have been maintained. Accounting policies have been consistently applied in preparation of financial statements except for the change indicated in the financial statements. Accounting estimates are based on reasonable and prudent judgment. International Accounting Standards, as applicable in Pakistan, have been followed in preparation of financial statements and any departure there from has been adequately disclosed. The system of internal control and other such procedures, which are in place, are being continuously reviewed by the Internal Audit department. The process of review will continue and any weakness in controls will be removed. There are no doubts upon the Company¶s ability to continue as a going concern. There has been no departure from the best practices of corporate governance as detailed in the Listing Regulations. Statement of Compliance with the Code of Corporate Governance for the year ended 31 December 2004 This statement is being presented to comply with the Code of Corporate Governance contained in the listing regulations of the stock exchanges for the purpose of establishing a framework of good governance, whereby a listed company is managed in compliance with the best practices of corporate governance. The Company has applied the principles contained in the Code in the following manner: 1. The Company encourages representation of independent non-executive directors and directors representing minority interests on its Board of Directors. At present the Board includes six independent non-executive directors including one director appointed under Section 182 of the Companies Ordinance 1984 and another director nominated by a financial institution. 2. The directors voluntarily confirmed that none of them is serving as a director in more than ten listed companies, including ICI Pakistan Limited, except for Mr. Tariq Iqbal Khan who is a


nominee of National Investment Trust (NIT) and has been granted a waiver from the application of the relevant clause of the Code by the Securities and Exchange Commission of Pakistan. 3. The Directors have voluntarily declared that all the resident directors of the Company are registered taxpayers and none of them has defaulted in payment of any loan to a banking company, a DFI or an NBFI. None of the directors is a member of a stock exchange. 4. During the year one casual vacancy occurred in the Board of Directors on 23 August 2004 and it was filled instantly. The Company has filed the necessary returns in this regard. 5. The Board of Directors of the Company, in its meeting held on 23 February 2001, adopted a Statement of Ethics and Business Practices under the title of µThe Way We Do Things Around Here¶, which has been regularly circulated within the Company since 2001 and is in the knowledge of the Company¶s directors and employees. 6. An µEmployee Satisfaction Survey¶ has been conducted and action plans are being implemented under the supervision of the Board. Pursuant to this, a vision/mission statement has been developed and approved by the Board at its meeting held on 25 February 2005 and it will be circulated to the employees of the Company. Earlier on 27 February 2003 the Board of Directors had approved and adopted a corporate strategy and significant policies. The corporate strategy is reviewed by the Board from time to time. 7. All the powers of the Board have been duly exercised and decisions on material transactions, including appointment and determination of remuneration and terms and conditions of employment of the CEO and other Executive Directors, have been taken by the Board. 8. During the year five meetings of the Board were held including four regular and one emergent meeting which were all presided over by the Chairman except for the emergent meeting which was chaired by Mr. Mueen Afzal as Mr. M J Jaffer was abroad. Written notices of the regular Board Meetings, along with agenda and working papers, were circulated at least seven days before the meetings. The minutes of all five meetings were appropriately recorded and circulated in time. 9. The Directors have been provided with copies of the Listing Regulations of the Stock Exchange, the Company¶s Memorandum and Articles of Association and the Code of Corporate Governance. Orientation courses, both in-house and external, were also arranged for the Board in 2003 and they are well conversant with their duties and responsibilities. 10. No new appointments of CFO, Company Secretary or Head of Internal Audit have been made after the application of the Code of Corporate Governance.


11. The Report of the Directors for the year ended 31 December 2004 has been prepared in compliance with the requirements of the Code and fully describes the salient matters required to be disclosed. 12. The financial statements of the Company were duly endorsed by the CEO and CFO before approval of the Board. 13. The Directors, CEO and executives do not hold any interest in the shares of the Company other than that disclosed in the pattern of shareholding. 14. The Company has complied with all the corporate and financial reporting requirements of the Code. 15. The Audit Sub Committee of the Board has been in existence since 1992. It comprises three members, all of whom are non-executive directors including the chairman of the committee. ICI Pakistan also has a Remuneration Committee comprising two non-executive Directors, which has also been in operation since 1997. 16. There have been four Audit Committee meetings during the year under review. The Directors have approved the revised terms of reference of the Audit Committee in light of the Code of Corporate Governance. 17. ICI Pakistan has had an effective internal audit function in place since the late 1970s. 18. The statutory auditors of the Company have confirmed that they have been given a satisfactory rating under the quality control review program of the Institute of Chartered Accountants of Pakistan, that they or any of the partners of the firm, their spouses and minor children do not hold shares of the Company and that the firm and all its partners are in compliance with International Federation of Accountants (IFAC) guidelines on Code of Ethics as adopted by Institute of Chartered Accountants of Pakistan. 19. The statutory auditors or the persons associated with them have not been appointed to provide other services except in accordance with the listing regulations and the auditors have confirmed that they have observed IFAC guidelines in this regard. 20. We confirm that all other material principles contained in the Code have been complied with.

Human Resources
Manpower numbers at 31 December 2004 were 1,299, 25 lower than 2003 as severance/ redundancy was offered to certain employees in accordance with the Company¶s existing Scheme. Efforts continued to bring about further improvement in employee commitment and motivation and another Employee Survey by an external, US based, agency was conducted


during the year. The results of this survey will become available in 2005 and actions in areas requiring improvement will be initiated accordingly. Union-Management relations continue to be friendly and industrial peace prevailed at all locations during the year under review.

Safety, Security, Health & Environment
The Company had zero Lost Time Cases for 2004 in continuation of a performance reflective of the µReportable Injury Accident Free 2003¶ initiative launched at the beginning of 2003. Your Company continued to ensure that all effluent generated at its Sites is treated to the best technical standards through efficiently operated and maintained Effluent Treatment Plants and that the outfall meets the compliance requirements of the applicable National Environmental Quality Standards. In addition, consistent with the Kyoto Protocol, ICI Pakistan has implemented a very demanding process of Environmental Burden Reduction at all its manufacturing Sites. In recognition of the commitment to a safer environment, the National Forum declared ICI Pakistan Limited the winner of the ³Environmental Excellence Award 2004´ for Environment and Health.

Social Responsibility & Community Work
As a responsible corporate citizen committed to the continuous improvement of communities within which it operates ICI Pakistan Limited through its trust, ICI Pakistan Foundation, provided financial assistance to various charitable and non-profit organizations during the year, including healthcare, education and social welfare organizations and projects that serve under privileged members of society. Community work by ICI Pakistan¶s Soda Ash Business in Khewra, Polyester Fibers Business in Sheikhupura and the Paints Business in Lahore also continued during the year. This included donation of computers and furniture, financial assistance, construction, renovation and maintenance of educational institutions and playgrounds in the communities close to the manufacturing sites of the Company. To create awareness about environmental problems, especially amongst children, the Company also sponsored WWF Nature Carnival and Save the Marine Turtle Project during 2004.

SWOT Analysis & Unique Selling Point


The environment policy and safety of health policies are extra-ordinary, it is a standard to follow and no one can compete in this department with ICI. y y y y y ICI¶s first priority is the customer satisfaction and it is practicing well. The customer satisfaction can be measure from the following practices: The delivery of Master Palette is made within 3 hours from order. Free color scheme advice to customers Prompt feed back, if there is any complain from the customer. Customer focus web site

A huge amount of investment made on the employees, dealers and customers. A large amount of tax was paid by company to the government of Pakistan. Also after one month or so painter parties are arranged, which develop a strong relationship: y y y y B2B B2G B2C C2C

When talk about the quality of the products, ICI is leading quality conscious company in the field of paints. · More than 80 years of experience in the paints industry. y y y y y y y y Multinational Company PLc U.K World renowned chemicals and paints manufacturers. Having production setup in more then 55 countries. Popularity of ICI is much more due to its thousands of other products rather then paints. Having product which has no competitors. Laid new histories in the paint industries. Business volume is very high as compared to the competitors. Focuses Safety, Security,

Health and Environment as a corporate social responsibility.

1.ICI s Positive Image
ICI has positive image and reputation in the minds of customers so far them it¶s a great strength because its helps in the sale of their products.


2.Financial Strength Of The Business
The paints business is financially very strong as mentioned by present annual report.

3.Established Nation- Wide Infra-Structure
The ICI paints business has established nation-wide infrastructure. It has network of dealers in all over the country, which will help in the sale of company¶s products.

4.Committed and enthusiastic staff
ICI is enjoying a committed and enthusiastic staff which is experienced as well.

5.Up To Date Technology
ICI paints have up to date technology in its production. ICI paints Pakistan claim that they offer 6134 colors to the customers out of which customer can demand any color and then they will make that color for customer. For that they have latest machinery in which they just give name of the color that customer want and then machinery gives them the formula which will produce that particular color a then they will produce that color for the customer

· The procedure of delivery is very complex for a customer to under, that¶s needs to be simplified or modify. · Some confused marketing strategies are made, which are later on replaced. Very low discounts for business partners. · Comparatively less convenient delivery of the products as the business partners are in 1000,s. · Meeting demand becomes challenge in the seasons

· ICI has the biggest market share in the paints business i.e. 76%. · Berger is the only competitor in this field and it is spending a lot of money and resources to get more market share, but it cannot compete with the quality. · In Pakistan customer are categorize in following ways: o Quality conscious o Price conscious ICI¶s is focusing both types of customers. · Pakistan is a big country when we talk about population, and people here belong to different status. From that point of view there is a lot of opportunity for ICI in Pakistan.


· Pakistan is developing country and there is a lot of business growth in this country. So seeking new markets in this area is great opportunity. · In developing countries, there is always opportunity for maintaining sustainable growth, so it¶s also in Pakistan. · Keeping the need of the market, still there are some products which are not offered by ICI. That product also weights a considerable share so by launching these products ICI can improve its market share. · Finding solutions to the painting problems can also help to grow. Such product are still absent in the market which can gain the attention of customers. So to work on those problems lead to a great opportunity. · Low price products can allow gaining a good market share. So cost cutting should focused. .No Distribution Network The major weakness of ICI paints business is that they don¶t have their own distribution network. They just have dealers in different cities which carry their products and then retailers have to use their own means to get paint from those dealers and then make it available for sale for the customer. Opportunities

1.Increase Quality Awareness Among The Customers
One of the greatest opportunities for ICI paints is that now a days people are very much conscious about the quality of the paints and they are aware of the fact that good quality paint is long lasting. As ICI is producing high quality paints so it will increase the demand of company¶s so it is a great opportunity for ICI paints.

2.Increasing Paints Markets
Another opportunity for ICI is that as now a days in Afghanistan re-construction of the country is taking place so there will be great demand for paints and ICI paints can reap this opportunity by exporting paints products to Afghanistan and can earn great profits

· ICI has only on job training for their employees and some of the employees need to have of job training also e.g. IT. · Berger has 12 housing team members and ICI has only 4, which may be create a big problem in the future. · The biggest threat to ICI Paints is the political and economic instability of Pakistan.


· Threats to the new entrants in the market. Cheap paints producers capture almost 60% of the market share of paints so it¶s a great threat for ICI paints because other companies will share the market as well. e.g. Nippon Paints Japan has entered the market of Pakistan

1.Decrease in Construction Activity
Due to decrease in the construction activity in the country the company¶s sales are decreasing as compared to previous few years.

External Analysis Threat of new entrants
ICI is enjoying No.1 position in paints industry they are having 20% of total market share. They do not consider now entrant as threat for themselves. Because of unstable economy and decrease in trend of construction, there is not much attraction in paints industry for the new entrants.

Threat of existing rivalry
ICI has to compete with a large number of paint makers. But the threat is from two major competitors. Those competitors are Master Paints and Berger Paints. Berger paints is having market share of 10% - 12% of the paints market. Their hot selling brand is Berger Robbialac. Other major competitor is Master Paints. Master Paints is having market share of about 2% to 3%. All other competitors are having a very small portion of market and are not considered as threat for ICI paint.

Threat of substitutes
There are not many substitutes available for the paints. For past few years there is an increasing trend of use of designed tiles and colored bricks.But ICI do not think that they are under any threat as far as substitutes are concerned.

Bargaining power of buyers
Bargaining power of buyer is a considerable threat for ICI paints because many competing brands are available in the market. It is necessary for ICI to satisfy their customers as far as price and quality is concerned. Otherwise the customers will switch to other brands.


Bargaining power of suppliers
There are two major suppliers as far as ICI paints are concerned.If any of the suppliers offer the terms and conditions that do not suit ICI, they would switch to the other supplier. So ICI people think that supplier do not have much bargaining power.

Unique Selling Point
· The unique selling point of ICI is it emphasis on environment control and there is no quality match with it. · An innovative global community working together to find and share better solutions. · ICI Paints, its brands, products and services will be the first choice for people who want the best. · The unique selling point of ICI Paints is its Research and Development. ICI Paints is spending over £30 million per year on Research and Development worldwide, which is huge amount for a business.

Analysis of paint industry in Pakistan

A chemical oriented liquid used to protect and decorate different kind of surfaces. Paint industry can be divided into two sectors. y Organized sector y Mushroom sector

It includes the companies listed in the stock exchange or the firms registered, having planned promotional activities with relatively high prices. They fall under the capacity tax system and distribute in more than one province.

It includes the unregistered firms, having city based distribution with seasonal brands, having lower prices with no planned promotional activities. They fall under the fixed tax system. COMPANIES LISTED IN THE STOCK EXCHANGE ARE


y Dulux ICI y Berger paints Pakistan Limited. y Buxly paints y Kausar paints. OTHER FAMOUS PRIVATE LIMITED COMPANIES 1 Master Paints. Dulux and Berger are the two competitive companies out of these listed companies. This is because these two companies have the higher number of brands which are competitively positioned against one another. Both are dealing in an extensive product range and in each product line they have a number of brands. If we see the product line of decorative paints their number of brands is higher as compared to any other company. Along with the decorative paints, Berger Robbialac is competing with ICI Dulux in other paints, such as auto paints and special protective paints. Almost the same promotional tools are being used by both the companies consequently they are giving a tough time to each other, especially in back selling field. They both have mobile teams focusing directly at the consumers.

Revenue generation makes ICI Dulux the market leaders of the paints industry. ICI Dulux is the market leader not only with respect to the turnover but also with respect to the number of gallons sold. ICI Dulux has an edge over Berger with respect to its diversified fields. ICI is known throughout the world and has a good name in other sectors as well, which gives an advantage to Dulux in paints. ICI has a strong impact on the consumers consequently ICI¶s weather shield has become a Generic name in Pakistan. Consumers often ask for ³Weather shield with lower price, as they are unaware of the fact that weather shield is the name given to the weather protective paints of ICI Dulux exclusively. Berger Robbialac uses the name of ³VIP Weather coat´ for its weather protective paint, but even in this product ICI Dulux is far ahead of Berger. Mushroom sector is not creating much problems and competition as they adjust their prices after analyzing the prices of the market leaders i.e. ICI Dulux. As far as the government is concerned ICI Dulux is paying all its taxes properly and so it is not being bothered by the different government policies. The total sales tax levied is about 16.5%. ICI had the policy of deducting this tax before supplying the products to its registered dealers but now they deduct only 15% tax is paid to the government directly by the dealers. Market share


ICI Dulux being the largest paint manufacturers has the largest holdings. It has almost 20% share in the paint industry in Pakistan currently. The rest of the market share is held by Berger, Buxly and the Mushroom sector. In the overall, local and multinational paints industry ICI has 39% of share. It has got the Turnover of £2161m for the year of 2004. The Trading profit for the year was £216m and it has got the Net operating assets of £790m and its Average number of Employees is 15,330.

The chemical industry in Pakistan is generally a weak sector. However, the downstream allied chemical industries have developed to meet the domestic demand. The example of this development is obvious in synthetic fibres, fertilizers, edible oils, sugar and cement sectors. The chemical industry, especially the petrochemicals, has not developed due to various reasons. This industrial sector is technology oriented and involves larger investment and hence makes the investors shy-away from this sector. Present investment in chemical sectors is estimated at Rs 360 billion. The chemical related imports constitute about 20% of the total import bill. This shows a vast potential for the chemical manufacturing industry in Pakistan. Various studies and surveys have been conducted in the past in order to assess the situation of chemical industry in Pakistan. The observations and recommendations of those reports have not been implemented and the same old impediments to the growth of industrial investment persist even today. Source and Availability of Raw Materials: The raw materials for the chemical industry come from three basic natural resources. a. Agriculture Products b. Mineral Products including Coal c. Petroleum Products (Gas & Oil)


Pakistan is rich in mineral and agro based raw materials. Coal, rock salt, gypsum, lime, molasses and baggase are few examples of abundantly available raw materials. These can be converted to high value addition chemicals for import substitution. · Pakistan is an agricultural country and agriculture based raw materials are available in abundance. Therefore, more downstream chemical products can be easily manufactured based on molasses, rice husk, cotton sticks etc. · Several minerals are available in Pakistan but the exploration and quarrying sectors need to be developed further. Additional investment is required in the infrastructure for the development of minerals, especially coal deposits in the Thur area of Sind. · Petroleum reserves of Pakistan are not adequate to meet the local demand. Most of the available natural gas is being used as fuel for domestic as well as industrial sector. A small portion of this gas is being utilised to produce fertiliser. Though the natural gas production is meeting the present demand, the known gas reserves are not enough for long term planning. Crude oil reserves are low and local production meets only 31% of the demand. So we can conclude that the chemical industry sector in Pakistan has a vast untapped potential to be used, but it is still under growth. The local companies are unable to meet the domestic sector demands for the chemicals. Therefore, we can put the chemical industry in the growing stages of industry life cycle.

ICI Pakistan is facing a tough challenge competing with the competitors in the local chemical industry. As the local chemical industry is not getting adequate support from the economic and political factors therefore the competition boils down to the quality and the price of the products.

There are several key players in the local chemical industry, major competitors of ICI includeDewan Salman Fibres ltd. , Ittehad Chemicals and Sitara Chemicals. The foreign chemical producers have also a significant impact on the local producers because of the low supply of local producers, the buyers can buy from the foreign producers. The major foreign players include the names as ³Century Enka´ and ³J.C.T Ltd.´ China is also playing a major role


in the chemical industry and the Chinese products are being welcomed into Pakistan as they are cheap alternatives to expensive European or Japanese products. Further more the advent of free trade in the year 2005 is also a problem for the manufactures of chemicals in the local markets.

The chemical industry is facing a stiff challenge in the face of increasing costs of inputs and government taxes. The production costs are rising day by day and it is very hard for these companies to improve quality. Therefore this problem is taking a serious hit on the profits of these companies. The cost of inputs for the chemical industry in Pakistan is somewhat fixed and it is very difficult for these companies to change the cost of inputs. Also the companies are producing most of their inputs and these inputs are further used into other products from these companies. ICI is drawing the salt water from the Khewra mines near it¶s vicinity free of cost under the charter of the British Rule. This salt water is then used to manufacture Soda Ash. This is a product which ICI sells separately as well as it is further used in the production of Chemicals and Paints. Despite this fact, the profit margins are decreasing and the costs are rising.

The pragmatic solution to the above mentioned problem is to reduce the cost, not by reducing the cost of inputs, but to decrease the costs of production. Waste products are an integral part of any chemical industry. There is large amount of waste materials both in liquid and solid form. One way to reduce overhead costs is to minimize wastes and increase workers productivity. ICI is currently having only one department for worker training and development. The basic emphasis of this department is the introduction of the SSHE plan. The SHE plan deals with industrial safety , security , employee health and environmental protection. This program mainly deals with the requirements of ISO14001 regulations. The need is for the development of workers for increased efficiency and productivity , maintaining at the same time high standards of works and reduced wastage products.


In a study at Nissan motors, Japan. It was found out that as a group, Superintendents were aware of only 7% of the problems in the plant. Managers knew only 4% of the problems while the workers at the plant were aware of 79% of problems. This explains how well the workers are aware of the problems in the organization and how well the first line workers can be potentially trained to make great differences in the long run to improve performance. And in a highly competitive environments even less significant differences prove to be well worth in the long run.

· There is a big need to increase the housing team, because of market need and competition between ICI and Berger. Berger is penetrating in the market, because last year market analysis shows that market share of ICI Paints has been reduced to 76% from 82%. This is alarming sign for ICI Paints. · The working of entire department depends on only one person i.e. IT/ Computer operator, but he is not happy with the connectivity of system with the Head Office, because everyone is waiting for invoices to print. Now department is using dialup for connectivity that should convert into DSL connection, which is now a day very much used by big organizations and quiet safer way of communication. · There should be special Van/Loader for the Master Palette delivery, because ICI policy is customer satisfaction. And that would be better step towards customer satisfaction.


Consumer Questionnaire

Following question was designed to assess whether consumers felt that fake paint is being sold in the market. Q. In your opinion is fake exterior paint being sold in the local market under various brand names? Yes No


In your opinion is fake exterior paint being sold in the local m





Pcn e et r

0 No Response Yes No

In your opinion is fake exterior paint being sold in the local market?

As shown in the graph almost 80% consumers are aware of the fact that fake exterior paint is being sold in the local market under various brand names whereas approx.20% consumers felt otherwise.

The following question was designed to assess the awareness level amongst consumers regarding any campaigns launched by paint manufacturing companies to warn against sale of fake paints. Q. Are you aware of any campaign launched by any paint manufacturing company to warn against the sale of fake paint? Yes (If Yes, elaborate: ___________________________________ ) No


Are you aware of any campaigns against fake paint?




Pe en r t c

0 No Response Yes No

Are you aware of any campaigns against fake paint?

As shown in the above bar chart more than 75% consumers were not aware of any such campaigns. y Dealer Questionnaire

Following question was designed to assess whether dealers and painters felt that fake paint is being sold in the market. Q. Is fake exterior paint being sold in the local market? Yes No The question yielded the following result:

Is fake exterior paint being sold in the local market?




Pe en r t c

0 Yes No

Is fake exterior paint being sold in the local market?


As shown in the graph almost 70% dealers and painters are aware of the fact that fake exterior paint is being sold in the local market under various brand names whereas approximately 30% felt otherwise. Following question was designed to assess the ways through which dealers and painters felt that fake paint is being sold in the market. Q. What is the basis/indication for the assumption that fake paint is being sold in the market? General market view Customer/Painter complaints Other [Specify: ______________________________________ ] The above question yields the following results:

What are the Indication that fake paint is being sold in the mar




F qec re u n y


0 No Response Customer Painter Com Market View & Compla General Market View

What are the Indication that fake paint is being sold in the market?

The above bar chart shows that 35% dealers have no idea whereas approximately 40% dealers and painters think that customer/painter complaints are the major indications that fake paint is being sold in the market and almost 15% think that general market view is the major indication and 10% painters/dealers think that both market view & complaints are the basic indications. Following question is designed to assess the confirmation of the sale of fake paint in the market. Q. How can one confirm the sale of fake paint in the market? Tempered Paint-box Painter¶s view upon usage The above question yields the following results:


How can once confirm the sale of fake paint in the ma






Pe en r t c

0 No Response Tampered Paint-Box Painter's view upon

How can once confirm the sale of fake paint in the market

As shown in the above bar chart more than 50% painter and dealers confirmed the sale of fake paint through painters view upon usage whereas approximately 35% painters and dealers have no idea about the sale of fake paint. Following question is designed to assess the approximate average percentage of the sale of fake exterior paint. Q. What could be the approximate average percentage of the sale of fake exterior paint? Up to 10% 10% - 20 % More than 20% The above question yields the following results:

What could be the approximate average percentage of the s




Pcn eet r

0 No Response Up to 10% 10% - 20% More than 20%

What could be the approximate average percentage of the sale of fake ext


As shown in the above bar chart approximately 35% of painters and dealers think that up to 10% is the average sale of fake exterior paint in the market whereas approximately 10% of the painters and dealers think that the sale of the fake exterior paint lies between 10% to 20% and almost 30% feels that the sale of fake exterior paint in the market is more than 20%. Following question is designed to assess that either the quantity of fake ICI Weathershield is more or less than the perceived average sale of fake paint. Q. Is the quantity of fake ICI Weathershield more or less than the perceived average sale of fake paint? More than average Average Less than average The above question yields the following results:

Is the quantity of fake ICI Weathershield more or less than t
60 50





Pe en r t c

0 No Response More than average Average Less than average

Is the quantity of fake ICI Weathershield more or less than the percieve

As shown in the above bar chart approximately 50% of the painters and dealers think that the quantity of ICI Weathershield is more than the perceived average of the sale of fake paint whereas almost 15% of them think that it was about average and only about 8% of them think that the quantity of ICI Weathershield is more than the perceived average of the sale of fake paint is less than average.


Following question is assess to design that either there has been any general awareness campaign launched by any paint manufacturing company to warn consumers about fake paint. Q. Has there been any general awareness campaign launched by any paint manufacturing company to warn consumers about fake paint? Yes No

The above question yields the following results:

Has there been any general awareness campaign lau






Pe en r t c

0 No Response Yes No

Has there been any general awareness campaign launched by any paint man

As shown in the above bar chart only 18% of the painters and dealers were aware of such campaigns. The following question was devised to estimate whether it was easier or more difficult to refill the paint boxes of ICI Weathershield in comparison to its competitors. Q. Is it relatively easier or more difficult to refill the paint boxes of ICI Weathershield? Easier More difficult Same The above question yields the following results:


Is it easier or more difficult to refill the paint boxes of ICI W
70 60


40 30



Pe en r t c

0 No Response Easier More Difficult Same

Is it easier or more difficult to refill the paint boxes of ICI Weathers

As we look at the above bar chart results more than 65% of the painters and dealers felt that it was easier to refill the container of ICI Weathershield. Following question was designed to speculate which of the following proposed solutions would be most effective to minimize the sale of the fake ICI Weathershield paint.

Q. What can ICI Paints do to minimize the sale of fake Weathershield? Sell through designated dealers only Introduce a tamper-proof seal Other

The above question yields the following results:


What can ICI do to minimize the sale of fake Weathershield




Pcn e et r

0 No Response Introduce a tamper p Other Sell through designa

What can ICI do to minimize the sale of fake Weathershield

By looking at the above results more than 65% of the painters and dealers were in favor to sell the ICI Weathershield paint through designated dealership whereas almost 23% of them were in favor of introducing a temper-proof seal in ICI Weathershield paints to minimize the sale of fake paint.

The survey findings can be summarized as follows:

y y y y

The quality of ICI Weathershield is considered the best amongst the various paint manufacturers. ICI does not offer as many incentives to its dealers as other competitors. The advice of the painter and dealer plays a vital role in the selection of a particular brand of paint. Consumers are unaware of the details of the token scheme and how they take advantage of consumers. A substantial amount of fake paint is being sold in the market. Fake ICI Weathershield is sold more than the products of other competitors. Consumers are unaware of campaigns against the sale of fake paint. Selling through designated dealers or introducing a tamper-proof seal could reduce the sale of fake paint.

y y y y


Based upon the market survey, the quality of ICI Weathershield is already considered to be the best. However ICI paints should carry out the following recommendations in order to increase the market share of Weathershield from 60% to &70%; y Devise a suitable strategy to nullify the effect of the incentive of ³Token Scheme´ being offered by Berger for its product. The beneficiaries of the ³Token Incentive´ are mostly the Painters/Painting Contractors. They also have maximum influence on the selection a specific brand of paint by the consumers. It is therefore essential the strategy must include some kind of incentive for the Painters/Painting Contractors. One of the approaches could be to give some kind of award to the Painters/Paint Contractors based upon the number of wrappers of Weathershield box collected. Install measures to eliminate/minimize the sale of fake paint under the brand name of ICI Weathershield. This can be achieved by: y Designing and installing a proper sealing system on the Weathershield boxes on similar lines as being done presently by Berger. Raising public awareness through advertisement about the fake paint sold in the market. Taking suitable measures whereby ICI Paints official Dealers are easily recognizable ± perhaps by displaying a sign board.

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Several strategic options can help ICI Paint overcome its weaknesses and gain market share from the competition. y Forward integration: ICI at the moment is depending on dealers for the sale of their products. These dealers store company¶s products, retailers have to get ICI products from these dealers & then offer customers for sale. If ICI instead of depending on dealers use their own on distribution to supply products to retailers then they can increase the sales of their products by giving products to every possible retailers and in this way they can get acceptance of every retailer to get their product and offer it to customer for sale. y Backward integration: Presently ICI Pakistan is purchasing its raw material from both local as well as foreign suppliers. About 75% material is purchased from foreign countries and 25% is purchased locally. As such as huge quantity of raw material is purchased from foreign countries that¶s why change in government import duties have a great impact on prices of raw material which also increase the prices of finished products.


Therefore if ICI acquires local suppliers for start making its own raw material then it can save itself from such fluctuations in prices, which could result in the stabilization of prices, and customers can purchase the products at low prices. If ICI gains control over their local suppliers by ownership and take charge of their operation then a significant cost cutting is possible. After getting ownership if ICI start manufacturing all or most of the required raw material locally then they can significantly reduce the volume of import thus avoiding the heavy import duties imposed by the govt. It will result in decrease in cost of product and ICI would be able to offer its product at a relatively cheaper price.


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