Secret sauce of Asian Paints Success | How This Indian Company Became a Global Leader in the Paint Industry
“Har ghar kuch kehta hai ki… Asian paints.” We’ve all grown up after seeing this TV commercial. Asian Paints ( https://www.asianpaints.com/ ) is one of Asia’s leading and largest corporations. There are a lot of struggles hiding behind the beautiful colours and wonderful walls. It has been serving with its colours for over seven decades. The company has had a remarkable success story over the years, with its origins dating back to 1942. Read along this article delight to know the journey of Asian Paints, from its humble beginnings to its current position as a market leader in the paint industry. So that you know the Secret sauce of Asian Paints Success and get inspired with its unique and creative strategies.
Early Days and Founding
Asian Paints was founded in 1942 by four friends – Champaklal H. Choksey, Chimanlal N. Choksi, Suryakant C. Dani, and Arvind R. Vakil. The company initially started as a small paint manufacturer in a garage in Mumbai, India, and faced several challenges in its early years.However, the founders were determined to succeed and focused on delivering quality products at affordable prices. Soon, their hard work and perseverance paid off. And the company started to gain a reputation for its quality products and exceptional customer service.
Growth and Expansion
As Asian Paints continued to grow, the company started to expand its operations beyond India. In 1975, it established its first international subsidiary in Fiji, followed by other countries such as Nepal, Bangladesh, and Sri Lanka.
The company’s expansion was not limited to just Asia, and in 2003, it acquired a 50% stake in the joint venture with the South African paint company, Kansai Paints. Today, Asian Paints is a well-known brand in South Africa, and the joint venture has become one of the largest paint manufacturers in the country.Asian Paints has been a leader in the pigment industry from long before 1970, though. What are the secrets to its palette of success that no competitor ever tries to come after its crown? Let’s find out.
The Secret Sauce Of Success Story of Asian Paints | The Asian Paints Success Story
First secret sause | Asian Paints changed mindset of consumer base
Asian Paints changed the mindset of people who believed that painting is done only when walls are peeling off. Today, painting the walls is more of a home decor and lifestyle.The process of painting one’s house was made an emotional process than a purely mechanical one by the strong ad campaign by Asian Paints. These ads made painting one’s home a festive affair, whether it’s Diwali or Pongal or a personal celebration like childbirth. Painting wasn’t just pigments and colours anymore, it was the reflection of the homeowner’s personality.
Second secret sauce | Paint manufacturing supply chain
Traditionally paint manufacturers would sell their paints to wholesalers or distributors, who would then sell to the retailers to bring paint to the end-user. This system, while effective, would cost manufacturers about 15-20% of their margin to pay the middlemen. What Asian Paints decided to do, which at the moment seemed like madness, was to axe these middlemen. Instead of the 15-20% of its margin going to the supply chain distributors, Asian Paints saved its cost to wholesalers. And, as a result, increased its profit. Asian Paints now earned 97% of its MRP, and the remaining 3% went to the retail seller, compared to the competitors who earned only 60-70% of their MRP due to middlemen.
Asian Paints, continuing its revolutionary idea, decided to alleviate the storage issue by employing a different aid to trade, and transport. The decision was not to make the retailers maintain a significant inventory but to keep restocking them at a high frequency. How high, you ask? Every three hours, during the working day, meaning 4 times a day and 28 times a week! To put this number in perspective, other brands were restocking once every 2-3 days.
Third secret sauce | Bought Supercomputer in India
In the year 1970, Asian Paint, for a grand sum of ₹8 crores, bought a supercomputer, the first to ever exist in India. This was 10 years before ISRO and IIT Powai and 22 years before any other company would do the same.
This supercomputer didn’t just zero in on the colours that would be demanded, but also the can sizes, paint base types, and the quantity of the colours being bought. Each purchase added to the data pool bolstering the accuracy of the predictions. The introduction and usage of trend-based data had far-reaching effects into the pre-production process of procurement of raw materials and the production process itself. Knowing exactly what was to be sold meant knowing precisely what was to be produced as well.
Final Takeaway | Secret sauce of Asian Paints Success Story
The story of Asian Paints undoubtedly impress and inspires you. Asian Paints began as an adventure between four friends in a garage during pre-independence India. The company sought to bring color to a time that was both technologically and emotionally pale.
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