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                                 INDUSTRY PROFILE #14
                                  PAINT MANUFACTURING
                                      Prepared By
                                    Philip Heiberger
                                      Reviewed By
                                     Patrick Raney
                                     Published By
               1600 Wilson Boulevard, Suite 500, Arlington, Virginia 22209 USA
                         Telephone:   (703) 276-1800, Fax:   (703) 243-1865
                           Telex:  440192 VITAUI, Cable:  VITAINC
                   Internet:, Bitnet:  vita@gmuvax
                                   Paint Manufacturing
                                    ISBN:   0-86619-301-4
                       [C] 1989, Volunteers in Technical Assistance
                                    INDUSTRY PROFILES
This Industry Profile is one of a series briefly describing small or medium-sized industries.  The
Profiles provide basic information for starting manufacturing plants in developing nations.
Specifically, they provide general plant descriptions, financial, and technical factors for their
operation, and sources of information and expertise.   The series is intended to be useful in
determining whether the industries described warrant further inquiry either to rule out or to
decide upon investment.  The underlying assumption of these Profiles is that the individual
making use of them already has some knowledge and experience in industrial development.
Dollar values are listed only for machinery and equipment costs, and are primarily based on
equipment in the United States.   The price does not include shipping costs or import-export taxes,
which must be considered and will vary greatly from country to country.  No other investment
costs are included (such as land value, building rental, labor, etc.) as those prices also vary.
These items are mentioned to provide the investor with a general checklist of considerations for
setting up a business.
These profiles should not be substituted for feasibility studies.  Before an investment is made in
a plant, a feasibility study should be conducted.   This may require skilled economic and
engineering expertise.  The following illustrates the range of questions to which answers must
be obtained:
        *   What is the extent of the present demand for the product, and how is it now being
        *   Will the estimated price and quality of the product make it competitive?
        *   What is the marketing and distribution plan and to whom will the product be
        *   How will the plant be financed?
        *   Has a realistic time schedule for construction, equipment, delivery, obtaining
           materials and supplies, training of personnel, and the start-up time for the plant
           been developed?
        *   How are needed materials and supplies to be procured and machinery and
           equipment to be maintained and repaired?
        *   Are trained personnel available?
        *   Do adequate transportation, storage, power, communication, fuel, water, and
           other facilities exist?
        *   What management controls for design, production, quality control, and other
           factors have been included?
        *   Will the industry complement or interfere with development plans for the area?
        *   What social, cultural, environmental, and technological considerations must be
           addressed regarding manufacture and use of this product?
Fully documented information responding to these and many other questions should be
determined before proceeding with implementation of an industrial project.
                   Equipment Suppliers, Engineering Companies
The services of professional engineers are desirable in the design of industrial plants even though
the proposed plant may be small.   A correct design is one that provides the greatest economy in
the investment of funds and establishes the basis of operation that will be most profitable in the
beginning and will also be capable of expansion without expensive alteration.
Professional engineers who specialize in industrial design can be found be referring to the
published cards in various engineering magazines.   They may also be reached through their
national organizations.
Manufacturers of industrial equipment employ engineers familiar with the design and installation
of their specialized products.   These manufacturers are usually willing to give prospective
customers the benefit of technical advice by those engineers in determining the suitability of their
equipment in any proposed project.
Volunteers in Technical Assistance (VITA) is a private, non-profit, volunteer organization
engaged in international development.   Through its varied activities and services, VITA fosters
self-sufficiency by promoting increased economic productivity.  Supported by a volunteer roster
of over 5,000 experts in a wide variety of fields, VITA is able to provide high quality technical
information to requesters.  This information is increasingly conveyed through low-cost advanced
communication technologies, including terrestrial packet radio and low-earth-orbiting satellite.
VITA also implements both long- and short-term projects to promote enterprise development and
transfer technology.
                      PAINT MANUFACTURING
Prepared By:  Philip Heiberger
Reviewed By:  Patrick Raney
The Product
Paint is a fluid suspension of finely ground pigments in a resinous
liquid known as the "vehicle."   When applied to a surface
as a thin liquid film, it changes to a solid.   Paint is used in
all countries to decorate and protect surfaces.
The many kinds of paint may be classified according to use:
trade-sales paints are used to paint houses; commercial or maintenance
paints are used for painting buildings and ships; and
industrial paints are used on machinery, manufactured goods, and
motor vehicles.
The Facility
This Profile describes a small plant that will serve local needs,
mainly in the trade-sales sector.   Its output may exceed 4,000
liters per week (L/wk).  For economic reasons, at least part of
its total output may have been imported in bulk, and then tested,
modified, and repackaged for the local market.
Paint is made in batches because the huge variety of uses and
variation in raw materials require adjustments of its properties.
The kind of plant varies somewhat according to the kinds and
amounts of paint to be made and whether the process starts with
raw or partially processed materials.
Many people work in some aspect of the paint business; for example,
distribution, application, or marketing.   Some of them may
recognize that the time is ripe for starting local paint manufacture.
Operating a paint factory does not need large capital
investment, but is technically complex and must take into account
the special needs of the local market.   Moreover, success requires
careful planning and deliberate growth.   A new business should
acquire the services of an experienced consultant.
The world's paint industry operates at an annual level of
US$20,000 million (estimated 1989 costs) with an annual, real
increase of three percent.  Rates of use depend on a country's
geography, industrial development, and the income structure of
the population.  Lacking specific information on these factors, a
rough estimate of annual trade-sales use is 400,000 L per million
population.  Of the total market, trade-sales paints make up about
40 percent, maintenance paints 20 percent, and industrial paints
40 percent.
Local manufacture should be considered when the costs of importing
the finished product become too high.   Government policy may
encourage local manufacture.   To help decide the best time to
start in a country where labor costs are relatively low, estimate
that half of the cost of imported materials is due to high labor
costs in the industrial countries.
At the start, a business plan should be jointly prepared by the
local entrepreneurs, appropriate government authorities, and the
consultant.  It includes levels of production, a developmental
time table, and concurrent development of technical expertise and
market knowledge.
The standards for finished paint usually are established by the
customers.  They relate to color, viscosity, composition and
percent of solids, gloss, and so on.   Tolerances to product variation
are relatively broad in trade-sales products:   an off-color
white house paint may be acceptable.   But industrial tolerances
are narrower:  a slightly off-color automobile paint will be
Regardless of plant size, each paint must be tested and warranted
by the manufacturer to meet the specifications established by the
supplier and the customer.  Raw materials are never uniform, the
process of dispersing the pigments in the vehicle is often unreliable
and color matching is erratic.   For such reasons every
batch of paint, whether imported or locally manufactured, needs
to be tested and approved, or modified to meet established standards.
Inadequate or inefficient quality control can lead to
business failure.
Manufacturing Equipment Flexibility
Tanks, mixers, dispersion mills and pumps exist in large variety.
The usual justifications for dedicated, expensive equipment
are to reduce labor costs and to meet production levels, factors
that are of relatively low importance in many countries.
Each company should buy the most readily and economically available
equipment and then operate it as skillfully as possible.  In
making decisions on equipment flexibility, the technical manager
takes into account the properties of construction materials as
well as fire and safety hazards.
Knowledge Base
Three kinds of experts are usually needed to start a paint factory.
The entrepreneur, who must be identified first, has access
to capital, knows the business environment, is influential in
government circles, and is enthusiastically committed.   The sales
manager must capably manage cost accounting, marketing, and
distribution.  The technical manager, who should be an experienced,
technically-trained engineer or chemist, manages the
purchasing, as well as laboratory and manufacturing operations.
Purchasing is a technical function because substitutions are
frequently made, and delivery and manufacturing schedules require
Quality Control
Every factory requires a laboratory to test both incoming raw
materials and outgoing finished products.   It must be staffed by
persons who can use testing equipment (e.g., viscometers, balances,
colorimeters, calculators) and application facilities
(spray guns, spray booths, dip tanks, brushes) and interpret the
results.  This phase of the business cannot be ignored or neglected.
Constraints and Limitations
Promised delivery dates of materials are frequently unmet.  Materials
that are received may be off specifications, with replacement
both costly and time consuming.   To help avoid these disappointments,
the supplier, the paint maker, and the customer
must work together.  Substitutions can sometimes be agreed upon if
the company can develop an alternative product or method of
application by understanding the science behind the technology.
Paint is a luxury item that has critical users with requirements
that differ from place to place.   In countries where labor costs
are high, trade-sales products must have the properties of easy
brushing, high hiding, and extreme durability.   Elsewhere, color
and appearance are the main criteria.   It would be too costly to
duplicate the first-named properties where labor cost is not a
critical factor.  In addition, paints must be formulated for local
conditions:  climate, color preferences, materials and labor
Maintenance and marine finishes must meet international standards.
A few multinational firms distribute them throughout the
world.  Industrial finishes are designed for specific end uses.
The users have modern application equipment and painting is an
integral part of the manufacturing process.   Most industrial
finishes are imported, but a local paint company that has acquired
market and technical experience can consider making industrial
finishes to given specifications.
Raw materials are rarely manufactured in nonindustrial countries
because the manufacture of pigments, solvents, and resins requires
complex, capital-intensive operations.   Thus, it is most
often the large, multinational chemical producers that sell these
materials to paint manufacturers.   Some intermediates (vegetable
oils, varnishes, alkyds, polyvinylacetate (PVA) emulsions) can be
made in smaller plants.  Additives are used in small amounts, but
they are proprietary and are bought from the manufacturers.
Raw-material suppliers are an important source of information.
They provide formulas and technical assistance on the use of
their products.  Even so, products claimed to be "easy to use"
(e.g., PVA emulsions) can be misused.
Multinational companies distribute their products widely and have
agents in many countries.  It is always best to work with the
local agents.  Because packaging and transportation are major cost
factors, it is advisable to buy from companies located so that
they can ship over short distances.
Sales Channels and Methods
Trade-sales paint outlets may be independent merchants or company-controlled
shops.  Sales channels thus must be selected with
adequate market knowledge.  New products can be promoted through
radio, TV, newspaper advertisements, special offers, or locally
appropriate means.  Painting contractors should be directly approached.
It is necessary to be part of the local business network
to get the best results.
Maintenance-paint sales usually begin with social contacts.  When
accord has been reached, the technical people of both the supplier
and the customer together sort out details and initiate a
development and testing program.   The paint company may need to
import or license the product until a volume or skill level is
reached to justify local manufacture.
In the industrial market, one deals directly with key executives
of the manufacturing facility.   Informal contacts often help key
persons of the country or region to gain confidence in the entrepreneurs'
manufacturing efforts, thus increasing sales.
Geographic Extent of Market
Sales may be limited to one country, a region or a large city
that is both a population and an industrial center.   If there is
more than one city, each may require different marketing approaches.
For example, paints for coastal areas differ from
paints used at high altitudes.   Satellite plants or local warehouses
may be advisable, depending on labor conditions.
Imported trade-sales paints or locally repackaged, imported, bulk
paints may compete with locally manufactured products.   Multinational
firms may establish local subsidiaries, offering them a
guaranteed source of raw materials and competent technical backup.
Their strengths are uniformity and reliability, but not
versatility.  Local entrepreneurs have the advantages of local
contacts, lower labor costs, and a more intimate understanding of
local needs.  It is in the trade-sales area that local manufacturers
have the best chance to meet foreign competition.
Market Capacity
In many countries only a few people can afford paintable homes
and purchase manufactured goods.   However, because nearly all
governments seek to improve general living standards, paint
manufacture is a potential growth industry.   As an example, the
factory's business plan may assume (from the best available data)
that two percent of the population are paint consumers and that
in five years another two percent will become users; thus usage
will double in five years.
Infrastructure, Utilities
     Land (large tract to allow for growth)
     Buildings (office, warehouse, laboratory, etc.)
     Access to transportation
     Power (should allow for tenfold expansion)
Major Equipment and Machinery
     Tools & machinery
     steel tanks or drums (200-L)
     1 mixing tank (400-L)
     1 mixing tank (1,200-L)
     portable mixers (several)
     1 large paddle mixer
     1 pebble mill (about 1,200-L capacity)
     1 sand mill (about 120-L/h capacity)
     1 small 3-roll mill
     several pumps
     filter press or centrifugal filter
     lift trucks
     stand-by electric generator
     storage tanks and filling line
     scales of different sizes
     Support equipment and parts
     first-aid supplies
     fire-fighting equipment
     protective clothing
Cost Summary
          Plant equipment . . . . . . . . . . $30,000
          Shop equipment  . . . . . . . . . .   10,000
          Fire and safety equipment . . . . .   5,000
          Laboratory supplies . . . . . . . .  10,000
          . . . plus land, buildings, office furniture and
          supplies, miscellaneous.  Cost not determinable.
These costs are conservative guidelines expressed in 1989 US
dollars.  More precise estimates require knowledge of local availability
and market variables.  Local government may assist by
providing free land, temporary tax relief, venture capital, etc.
Licensors may provide technical assistance and international
agencies may provide financial assistance.   Assistance from all
sources should be considered in the business plan.
Materials and Supplies
     Raw Materials (selected according to kind of paint):
     vegetable oils
     polyvinylacetate (PVA) emulsions
    Containers.   If they are not locally available, estimate
    $10,000 to $50,000 for a six-month supply.
     dispersion foremen
     color shaders
     warehouse supervisor,
     chief quality-control tester
     paint manufacturing foremen
     filling-line foremen
     chief mechanic
     chief electrician
     librarian (maintain technical records and organize literature
     fire chief
     first-aid technician
     dispersion operators
     assistant shift foremen
     cook (if a kitchen is required)
     cleaning staff
     kitchen helpers (if required)
For both large and small plants the main steps in paint manufacture
are as follows:

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Mixing and dispersion.
Pigments are usually added to the vehicle by blending the ingredients
in a paste mixer.  The paste that is formed consists of
poorly mixed aggregates of pigment and vehicle; this paste is
brought to a specified fineness and uniformity by using an appropriate
mill.  "Grinding" or shearing wets the individual pigment
particles with the liquid vehicle and further reduces the
size of the pigment aggregates.   For emulsion paints, such as the
PVA's, the pigments must be dispersed separately in a mixture of
surface-active agents and hydrophilic gums.
Thinning down and adjusting.
The paste is usually further blended with vehicle, driers, fungicides,
and other additives.  It is then tinted with colored
dispersions to match a desired color standard.
The paint is tested against standards for color, application
properties, and other features.   It is then adjusted to meet
agreed specifications and released for marketing.
Filtration and packaging.
Filtration is often performed at the time of packaging to remove
lumps from the product.
Technical Manuals
The most important and useful references are the publications of
the raw-materials suppliers.
Unfortunately, no journals or texts specifically serve the needs
of developing countries.  However, a technically trained and
experienced person can use the libraries and information centers
available in many embassies and trade missions, and in local
universities and technical centers.
Trade Associations
Industrial countries usually have specific technical and trade
associations designed to assist local businesses.   To gain access
to these sources, consult the Economic Advisor attached to the
embassy or trade mission of the country of interest.   One example
of such an association is Paint Research Associates (PRA), Waldegrave
Road, Teddington, Middlesex TW11 B6D, United Kingdom.   This
organization provides information services in English for a fee.
Equipment Suppliers
For turnkey operations or for new equipment, there are many
excellent companies.  Many of these have local agents whom should
be interviewed.  However, it is more usual for a starting company
to purchase used or locally fabricated equipment.   It is assumed
that the entrepreneur of the new company knows of these resources.
If not, he may wish to seek a cooperative venture with
an experienced partner in an industrial country.   For further
guidance on this matter, consult the Economic Attache of a
favored trading country.
Because the paint business is technical, every step must be
constantly monitored by well trained technicians.   Thus, it is
imperative that the entrepreneur have constant access to an
experienced, technically trained person, who should be the technical
director.  Even with such expertise, the entrepreneur should
have the backup of an experienced consultant.
VITA Resources
VITA has a number of documents on file dealing with industrial
VITA Venture Services
VITA Venture Services, a subsidiary of VITA, provides commercial
services for industrial development.   This fee-for-service includes
the following:  technology and financial information,
technical assistance, marketing, and joint ventures.   For information,
contact VITA.