Why small paint companies live hard
On Board Charger,Smart Charger,Scooter Charger,Buck-Boost Charger Beiamp New Energy Co., Ltd. , https://www.beiamp.net
October 11 09:01:12, 2025
In 2007, China's small paint companies faced a tough year. Rising raw material costs made operations increasingly difficult, and many found their market share shrinking. The industry was undergoing a consolidation phase—stronger players were gaining ground while weaker ones struggled to survive. According to data, over 80% of the companies in China’s paint industry are small, yet they hold only about 20% of the market. This imbalance is not unique to China; many developed countries also have numerous small paint firms. However, these foreign companies tend to be more stable and efficient. Why is that? The author identifies two key factors.
First, most Chinese small paint companies try to offer a wide range of products, aiming for a one-stop solution. However, due to limited resources and financial power, they often fail to deliver quality or consistency. In contrast, small paint companies abroad focus on specialized production, typically producing intermediate materials or niche products. This specialization allows them to develop unique strengths and avoid direct competition with larger firms. Unlike the closed-loop model seen in many Chinese companies, foreign small businesses operate in a more integrated and efficient manner.
Second, in China, small and large paint companies often compete head-to-head for raw materials, logistics, and market access. This creates a hostile environment where both sides fight for survival. Some small companies even engage in misleading branding, such as using similar names like "Da Bao Qi" and "Tai Bao Qi," which harms the industry's reputation. Meanwhile, in developed countries, small paint companies often work as suppliers or partners to larger firms. They provide specialized services and rely on the support of bigger companies in areas like supply chain, distribution, and sales. This collaborative model fosters mutual growth and stability.
With the construction industry booming, the paint sector now has a golden opportunity. However, the market is crowded with too many brands, leading to intense homogenization. Companies will soon face a major shake-up. Compared to large enterprises, small paint firms lack advantages in technology, capital, and scale. Simply competing through price or volume won’t be enough. To survive and thrive, they need to rethink their strategies and learn from successful models abroad. Change is no longer optional—it's essential.