This case is discussing the U.S. paint industry and especially the case of Jones Blair
Company under the direction of Alexander Barrett. This industry contains almost 600
paints firms and is divided into three broad segments: architectural coatings, original
equipment manufacturing coatings, and special-purpose coatings where each segment
serves a specific need. Jones Blair Company produces and markets architectural paint and
original equipment manufacturing coatings under the Jones Blair brand name. In addition
to manufacturing a full line of architectural paint, the company sells sundries under Jones
Blair brand name but not produced by their firm. Jones Blair Company divided the market,
which contains more than 1200 outlets, into Dallas-Fort worth (DFW) metropolitan area,
contains 600 outlets and non-DFW nonmetropolitan area contains the remaining outlets.
The estimated dollar volume of architectural paint and allied products sold in Jones Blair
was $80 million; DFW area contains 60% of this figure and the remaining percentages in
the other areas. Therefore, the Jones Blair Company is succeeding in the DFW
metropolitan area but having some problems in the non-DFW nonmetropolitan area.
This industry contains a high level of competitors in this market:
Large number of companies produces the architectural coatings segments such as
Sherwin-Williams, Benjamin Moore, the Glidden unit of Imperial Chemicals, PPG
Industry, Valspar Corporation, Grow Group, and Pratt & Lambert. These producers market
the paint under their own brand names and for retailers under private, controlled or store
brand names such as WAL-MART.
In addition, specialty paint stores, lumberyards and independent hardware stores that sell
architectural paint and paint sundries have been able to compete in this industry despite the
existence for big stores and home improvements centers.
Moreover, the architectural coatings and sundries demand are affected by the competition
from alternative materials like aluminum and Vinyl siding, interior wall coverings, and
wood paneling.
The higher- quality products that reduced the amount of paint necessary per application
and the frequency of repainting also affected the demand for the architectural coatings and
sundries.
Jones Blair Company were facing competitors at the retail level and the paint
manufacturing level:
o At the retail level, competition has increased in recent years where Sears and Kmart,
Sherwin-Williams and Home Depot have multiple outlets in DFW. Alsothe competition for
retail selling in stores, lumberyards and hardware stores has increased.
o At the manufacturing level, competition has increased as well. Companies who sell to
contractors serving the home construction industry have aggressively priced their products
to attract a higher number of consumers.
