TOA works to become market leader in protective coatings
New TOA Paint MD outlines strategy to fresh competitive edges
TOA Group aims to become a regional leader in the protective-coatings market with total sales of Bt20 billion by 2015, the year the Asean Economic Community (AEC) becomes effective, vice president Jatuphat Tangkaravakoon told a news conference yesterday.
To support this business strategy, the company has appointed Pongcherd Jameekornkul, who has a proven track record leading and developing the company's business domestically and internationally, as managing director of TOA Paint (Thailand) Co. He is expected to bring added expertise to TOA's management team as the company aims to maximise efficiency, opportunities and performance in key areas.
Jatuphat said the TOA business strategy for 2013-20 focuses on building new competitive advantages for the domestic home-decoration segment, as well as laying the foundation for growth in the non-decorative market at home and abroad amid the AEC.
"Our business goal is to become a market leader in the protective-coatings market in Asean by delivering a variety of innovative products with service excellence that meet the needs and changing lifestyles of our target consumers," he said.
The company expects average sales growth of 16 per cent per year with accumulated sales of Bt20 billion by 2015. From 2007 to 2011, annual sales growth averaged 12 per cent, and last year the company enjoyed 20-per-cent growth to the highest sales figure in its history. This was driven by demand for home repairs after the big flood of 2011, the growing real-estate market in recent years, and the rapid growth within the premium segment, which significantly strengthened TOA's revenue base, he said.
Pongcherd said the industry had a total market value of Bt19 billion in 2012, a 10-per-cent increase over the previous year. Of this figure, the premium segment accounts for 26 per cent, while ultra-premium products secure 23 per cent, the medium range 31 per cent and eco-products 20 per cent.
TOA had a 50-per-cent share of the premium market, 23 per cent of the ultra-premium, 62 per cent of the medium and 26 per cent of the eco-market.
Overall, TOA held 47 per cent of the paint market last year with reported revenue of Bt9 billion, or 20-per-cent growth over 2011. Sales of water-based paints in all portfolios reached Bt15.5 billion, also up 20 per cent, which surpassed the company's initial projection of Bt14 billion.
This year, TOA expects revenue of Bt18.6 billion, up 20 per cent, Pongcherd said.
The company's outlook includes increasing its market share by 1 per cent annually in an attempt to achieve the first position in the markets for wood paints, chemicals and industrial coatings as well as a leading position in the water-based category across Indonesia, Vietnam and Malaysia.
Its projected market share for Southeast Asia is 14 per cent, rising from 12 per cent set for 2012. The strategy to fulfil the goal is to build new competitive advantages in addition to leveraging such existing edges as established brands, an extensive retail network and expertise to grow the non-decorative segment, focusing on wood paints, chemicals and industrial coatings, as well as penetrating international markets.
TOA currently operates facilities in Vietnam, Laos and Malaysia, and plans to invest in new factory constructions in other Asean countries, starting with Myanmar, which will be completed by the second quarter. It is also seeking to expand its business presence and production base in other strategic locations to meet rising demand in the AEC market and make TOA a regional brand in the near future.