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Overview of Vietnam’s paint and coating industry

Overview of Vietnam’s paint and coating industry

Monday 07, 03 2022
Currently, there are about 600 enterprises operating in Vietnam’s paint and coating industry, 70 of which are foreign-invested companies. According to a report by VPIA (Vietnam Paint and Ink Association), in the past 5 years, paint manufactured by FDI company has accounted for more than 65% of the Vietnamese market despite their small quantity, while that of domestic companies accounted for only 35% of market share.

Value of Vietnam’s paint and coating industry

Paint and coating industry in Vietnam is predicted to grow from 383 million USD in 2018 to 459 million USD by the end of 2022. The industry has recorded steady growth over the years due to the very active development of the construction sector.

Paint and coating industry

With the massive participation of leading multinational paint and coating manufacturers such as AkzoNobel, Nippon, Jotun and companies in Southeast Asia such as Toa, 4 Oranges, capacity of Vietnam’s paint and coating industry has been expanded significantly in recent years. In addition, over the past time, a number of domestic companies have also invested in modern machinery and lines to meet the increasing demands of the market.

Despite being severely affected by the Covid-19 epidemic, in 2020, Vietnam's economy grew significantly at 2.91%, while many countries in the world recorded negative growth. Stable economic growth in next few years is expected to give the paint and coating industry in Vietnam a much-needed boost in the short and medium term.

The architectural paints segment has a breakthrough opportunity, accounting for about 62% of the paint and coating market in Vietnam by volume. The retail paint and decorative coatings market in Vietnam is expected to grow from 89,000 billion VND ($382 million) to about 107,000 billion VND ($459 million) by the end of 2022 when the Covid-19 epidemic is under good control.

The architectural paints

Along with the recent rise of real estate, which has created a fever in the Vietnamese paint market, domestic and foreign paint businesses have entered a real race with increasingly high quality paint and deversity in types, features, and colors. This has created a healthy competition and a vibrant and positive overall picture of the overall development of the coating market in Vietnam.

Competition between domestic and foreign enterprises

Currently, there are about 600 enterprises operating in Vietnam’s paint and coating industry, 70 of which are foreign-invested companies. According to a report by VPIA (Vietnam Paint and Ink Association), in the past 5 years, paintmanufactured by FDI company has accounted for more than 65% of the Vietnamese market despite their small quantity, while that of domestic companies accounted for only 35% of market share.

Paint produced by foreign companies is more professional and covers a wide range of categories. It can be seen that each type of foreign paint has its own unique features. Foreign paint products serve many purposes such as shipbuilding, galvanized steel coating, airport paint, wood, beverage shells, etc. Therefore, ordinary consumers will know little or have no idea about such brands.

35% of the paint market is held by domestic companies and low-quality paints. However, the domestic paint market still has a positive growth rate.

With the real estate market gradually recovering, followed by urgent needs for construction materials and decorative paints, Vietnam's paint market has also experienced a remarkable and attracted many participants.

The Vietnamese government

However, along with the massive entry of large and small enterprises, counterfeit or poor quality products appeared rampant, causing the market to become mixed. The Vietnamese government also has no specific punishment for this issue. The heaviest punishment is only 20 million VND when detected, which is too small compared to the profit that manufacturers of counterfeit and poor quality goods may earn.

With such potentials and barriers, Vietnam’s paint and coating industry is a growing industry that has much room for development.

Source: Coatingsworld, dantri

Compiled by VietnamCredit

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