Last time, we evaluated the SWOT Analysis of Kansai Nerolac Paints. This time, we will examine the SWOT Analysis of Berger Paints.
Berger Paints is the 2nd largest paint company in India, founded in 1760 in the UK. Over the last century, technology has advanced tremendously, and they think the future will be just as exciting. Why? Because their products have always satisfied a need in people’s lives, they will never stop making them.
Berger Paints has also competed successfully in its marketing efforts in the past few years. With the growing popularity of online mediums, marketing is undergoing constant changes. If you would like to learn more about the most up-to-date marketing techniques, consider joining our Quick Masterclass on Digital Marketing Basics by the CEO and Founder of IIDE, Karan Shah.
In this blog we will talk about the detailed SWOT Analysis of Berger Paints and decode its success. Let us begin by learning more about Berger Paints, its founding, products, financial status, and competitors.
About Berger Paints
Berger Paints traces its roots back to its founder Lewis Berger, who established the business in 1760 in the UK. Berger Paints India Limited began in India in 1923 with modest beginnings. Today, Berger Paints India Limited is the second-largest paint company in the country and has consistently been one of the fastest-growing paint companies for decades.
Over its 88-year history, the company has seen several changes in ownership and nomenclature. Its first factory was in Howrah, West Bengal, as Hadfield’s (India) Limited. British Paints (Holdings) Limited, a company based in the United Kingdom, acquired Hadfield’s in 1947. After this, British Paints (India) Limited was formed. Berger Paints India Limited was established in 1983 as a new name for the company. Presently, the majority of the shares are held by the Dhingra brothers from Delhi. This is how it has established itself over a long course of time.
|Origin||Kolkata, West Bengal, India|
|No. of Employees||3600|
|Market Cap||₹74.73 T Crore (2020)|
|Annual Revenue||₹6,365.82 Crore (2020)|
|Net Income/ Profit||₹1,798.49 Crore (2020)|
Products of Berger Paints :
Berger Paints has been in this industry for more than a century and it has many items to sell to consumers to choose from. Some of them are :
- Decorative paints
- Industrial finishing products
Close Competitors of Berger Paints:
The top 5 competitors of Berger Paints are:
- Asian Paints.
- Akzo Nobel.
- Shalimar Paints.
- Kansai Nerolac Paints.
- Acro Paints Ltd.
Now that we understand the company’s core business, let’s delve into the SWOT Analysis of Berger Paints.
SWOT Analysis of Berger Paints
SWOT analysis is a strategic planning framework that a firm can use to get a detailed analysis of the company’s situation. Using a SWOT framework can help Berger Paints realize its strengths, weaknesses, opportunities, and threats associated with its strategies.
Only through regular SWOT analysis and improving itself, Berger Paints several maintain its dominance in its business sector. A Berger Paints SWOT analysis will prove to be very useful for other companies too.
1. Strengths of Berger Paints
Berger Paints has many strengths that will make it a leading player in its market.
- Strong Portfolio: Berger Paints offers a variety of paints, from residential to industrial, in its product portfolio. Also available are decorative paint options, which are the latest offering and in high demand. Additionally, it acquired the decorative paint unit from Sherwin Williams Paint’s Indian unit.
- Brand Recognition: They have strong brand equity because they are the second-largest paint manufacturer. Many people recognize the brand and are familiar with its products and offerings. Intensive marketing campaigns have established them as household names.
- International Market: This company has international operations in several countries, which include Russia, Bangladesh, Nepal, Poland, Cyprus, as well as collaborations with Becker, a Swedish company, and Nippon paints, a Japanese company
- Leaders with Experience: The company’s chairman, Kuldip Singh Dhingra, and vice-chairman, Gurbachan Singh Dhingra, own a combined 75% of the company, making it the second-largest manufacturer of paints after Asian Paints.
2. Weaknesses of Berger Paints
An organization’s internal factors include its weaknesses. Several of these weaknesses can be identified through SWOT analysis:
- High Reliance on One Segment: Berger Paints’ highest sales are driven by one segment, which is the decorative market. As a result, it cannot support long-term high growth rates.
- Small Purchasing Power: Due to a duopoly in the industry, they lack pricing power. To remain competitive, they need to keep their costs in line with the paint costs.
- Smaller distribution: As compared to Nerolac, Berger paints are considered to have a smaller distribution network. This presents a challenge for the company. If necessary, it needs to expand its distribution network and increase its production capacity.
- No Premium Alternative: In their Asian paints Royale initiative, Asian paints has successfully targeted a unique segment that gives them a high-profit margin. For Berger paints to improve sales and brand equity, they need to take such steps to get in touch with their customers.
3. Opportunities of Berger Paints
The opportunities in a business are external factors that can be tapped for profit and benefits.
- Marketing: As far as marketing communications are concerned, Berger Paints needs to improve its performance. Asian and Nerolac paints dominate when it comes to advertising, while Berger Paints lags and is less frequent with their advertisements. Marketers will raise the brand’s value and create demand from consumers. Both in terms of visibility and sales, it offers high-quality products and has a large market space.
- Untapped Market Potential: Indian households use very little paint. This segment has considerable growth potential. There is also an increase in demand for paint as urbanization continues.
- Introducing New Products: They can launch new products in the paint industry and invest in their R&D to create superior technology. In addition, they can launch more eco-friendly paints and make them healthier.
- Market Opportunities: Currently, Berger paints is only present in four countries, but its manufacturing base implies that it will be able to expand into other emerging markets in time.
4. Threats of Berger Paints
As part of a swot analysis, threats are most important. A Berger Paints SWOT analysis will reveal the threats that have been holding the company back.
- Price Fluctuations: Paint’s raw materials are subject to large fluctuations in price. These fluctuations may pose a risk to the company.
- Changes in Government Laws: New companies may be established in this sector as a result of changes in government laws. There will be more competition in the market.
- Margin Erosion: Asian paints, Nerolac, and Berger paints are all facing stiff competition. Berger paints seem to have fallen behind, resulting in penetrating pricing and smaller margins. This may affect Berger’s future.
In conclusion, Berger Paints can be said to be strong due to steady growth in profits and global reach. As for its greatest weakness, that would be a stiff structure of an organization. Although it doesn’t look like much, it is a huge burden to carry.
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