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Argentina in slow recovery

Juan Nicolás Iadisernia - Argentina

The lags of the economic crisis and the increases in the prices of raw materials have affected the painting industry. However, the sector maintains the dynamics and the market seems to grow.

by Vanesa Restrepo

- Publicidad -

Despite the demand for products, the recovery of the economy and the competitiveness that are still preserved, the growth prospects of the painting industry in Argentina are fraught with uncertainty. According to Nicolás Iadisernia, of Sherwin Williams Argentina, this is due to the conjunctural moment that the economies in the world are going through and particularly Argentina, where there are still high levels of inflation.

Iadisernia, current director of Research and Development of the Hispanic South America Region for the areas of architectural paints and coatings, wood products and aerosols of the multinational painter, assures that the sector faces some difficulties that slow down its growth and force an increase in the prices of the products. Despite this, he argues that the industry is still competitive.

"The situation of permanent increase in the prices of raw materials, polymers of all kinds, organic and inorganic pigments, solvents, additives and even mineral fillers, are producing increases above the ability to transfer them to the prices of finished products. This, in addition to a restriction on sales, impacts on the margins of the industry," says Iadisernia.

Similarly, the rise in energy prices contributes to increased production budgets for both finished products and raw materials. With the energy crisis, explains Iadisernia, "the prices of those raw materials with high energy consumption in their production increase, as in the case of understandr pigments, which can also impact the productivity and organization of industry activities."

A dynamic market
The paint market in Argentina presents very particular conditions, because in addition to having international influences and permeating itself with world crises, it must also overcome the lags of the economic crisis that erupted at the beginning of the decade.

"Our market is recovering its level of activity after the sharp fall of our economy in 2002, from 2004 began a frank and sustained recovery to reach during the last two years, the levels of production prior to the crisis" says Iadisernia, with the ownership given by his more than 37 years in the industry.

Despite the adversities, our professional of the month maintains his faith in the good prospects of the sector, as he assures that it is diverse: "it is a very competitive market, there are five leading companies that, together, have 70% of the paint market. The remaining 30% is distributed in more than 200 companies, many of them important in the sectors in which they participate, particularly when they are dedicated to special niches."

- Publicidad -

Precisely, this difference in the type of companies gives a special characteristic to the Argentine paints market: "the main companies serve all market segments from architectural, industrial protection, industries, OEM, powder coatings and automotive repainting. Then there are also very specialized niche market companies with very good technology and a long history in their fields."

Another characteristic of this market is the coexistence of companies of international level with other local ones, in similar conditions in terms of competitiveness and development. In both types of companies, explains Iadisernia, there are high professional levels.

As for marketing, Iadisernia explains that in that country there is "an extensive and developed network of independent paint shops that are characterized by their high professional and commercial level" and recognizes that, in them, there is a specific orientation depending on the public to which the product is directed, whether they are professionals or home consumers.

"These networks, of various sizes, are distributed throughout the country and are constantly expanding and changing. Some are true "paint boutiques" in which the purchase of the most diverse coatings and colors offered, becomes a pleasant and profitable experience in terms of satisfying the needs of consumers and professionals, "he points out.

In the segment of industrial paints, Iadisernia also points to an important growth in recent years "associated with the recovery of some important projects in the areas of mining, petrochemical, construction, and in the greater activity of the agricultural machinery industries, timber and automotive that continues to consolidate its local participation and expand its exports."

Recovering market
The process of recovery of the Argentine economy, after the recession experienced between 2001 and 2002, also benefited the paint sector. The average growth of the country, in economic terms, fluctuated around 8%, which allowed a staggered recovery of the levels of productivity that were had in the early 90's.

- Publicidad -

This growth, according to what Iadisernia pointed out, produced, by drag, the growth of the painting industry, although it was also accompanied by certain changes in the characteristics of products and services: "sometimes, motivated by aspects of purchasing power, solutions with little added value are offered for consumers and the distribution chain".

Despite the above, the economy of that country shows a tendency to slow down that, added to the increases in the international prices of oil and its derivatives, as well as energy and raw materials in general, may end up hitting the industry again. Similarly, phenomena such as the increase in interest rates on loans, cooling of the economy and the collapse of the agricultural crisis that that nation faced in the previous months are experienced, due to differences in the agricultural policies adopted by the government.

Iadisernia mentions significant increases in the price of monomers, solvents, pigments and in plastic and metal packaging. These elements become threatening to the industry, if other elements such as financial uncertainty in the international arena, the real estate crisis and the generalized increase in inflation levels are taken into account.

Regarding the economic future, particularly for the sector, Iadisernia contextualizes: "it is very likely that the growth prospects will be different for the different segments, according to the new needs that are generated."

Good prospects
The difficulties mentioned above have forced formulators and suppliers of raw materials to look for new products that allow to maintain production levels, maintain quality standards and lower costs, both for the producer and for the consumer.

"Our sector has proven to be dynamic, to know how to adapt to the conjunctural conditions of the economy and permanently generate new solutions and proposals for the markets," says Iadisernia, who also recognizes that the government of that country has been in favor of granting value and supporting investments, as well as supporting the industrial and technological projects that are undertaken.

"In particular, the paint sector has enormous possibilities to make this crisis a new opportunity for growth, improving productivity, reducing costs, generating alternatives and innovative application systems that provide the market with added value."

Likewise, the recovery of some important projects in the areas of mining, petrochemicals, construction, and in the greater activity of the agricultural machinery, timber and automotive industries that continues to consolidate their local participation and expand their exports, are elements that allow us to glimpse a sectoral growth in the coming years.

Vision of the future
In order for companies to take advantage of public policies and be able to stay in the market, it is necessary that they provide greater added value. This translates into the need to offer advantages in applications, properties and quality of products, to compete shoulder to shoulder with the other companies that are in the market.

Nicolás Iadisernia suggests that companies "must have a clear interpretation of what is happening at a global level, make a clear reading of the needs, to solve these new problems". That is why he insists that it is important to be informed and updated, because innovation becomes a differentiating element.

Elements such as environmental awareness, social responsibility and commitment to the final consumer are some of the aspects that can make the difference between one company and another. To the extent that each of these elements is developed responsibly, the company can be strengthened, both internally (relationship with employees) and externally (interaction with the community). "It will no longer be enough to do more of the same," he says.

"For this they must equip themselves with highly trained professional teams, promote the continuous training of their cadres, technological updating with a vision of making their activities and businesses sustainable."

The key to corporate success is then in the company's ability to improve its productivity, promote and operate competitively, reduce its costs, generate new business, propose creative and innovative solutions to current problems and challenges. According to Iadisernia, "a long-term vision is vital in which compliance with all regulations, both tax and business and social and environmental, are part of their strategies."

The professional profile
Nicolás Iadisernia has dedicated more than half of his life to the painting industry, which he joined when he was 16 years old. By then, he alternated his studies in chemistry with a position at the Beckacite synthetic resin factory, where he worked for 5 years in the areas of quality control and polymer development and production.

Iadisernia, born in Buenos Aires, is proud of his professional career: "throughout my extensive career I have had many challenges and achievements in terms of solving technological and formulation problems."

During his formative stage, he also went through companies such as Resinas Argentinas, Diransa S.A and Sherwin Williams Argentina. As a result of each of these experiences "I was developing a great passion and interest in the industry, the training in polymers allowed me to understand in depth the principles of formulation, manufacture and control of products and processes, and at the same time understand the art and science of the formulation and management of technology. to paints and coatings, plus all their needs and characteristics associated with industry and the market."

In his academic training, there are countless courses and specializations in the areas of polymers, ISO quality systems, statistics and statistical tools, paints and coatings, color and color measurement, management, project management, teamwork, negotiation and management, among others. Likewise, he has taught courses in paints, corrosion protection, color and color systems in different academic and technological centers.

Since 1979, Iadisernia has been part of the company Sherwin Williams Argentina, where it began in the direction of the area of formulation of resins and varnishes and in the resin manufacturing plant. His skills in management and direction allowed him access to the research and development laboratories of synthetic varnishes and enamels and, later, to the development and quality management.

He arrived in this last area in 1984 and through it he has been at the forefront of the processes of technology update and technology transfer from the headquarters of Sherwin Williams in the United States.

Some of Iadisernia's main achievements in the last 24 years are the design of the processes, the aqueous effluent treatment facility and the water recycling plant in the company.

For three years, Iadisernia has held a position in the Technical Management of Sherwin Williams Argentina, a job that alternates with the Direction of Research and Development of the Hispanic South America Region for the areas of paints and architectural coatings, products for wood and aerosols. "I have incorporated new technologies in this area for all the processes of our plant, thanks to the concern and determination of our company for industry standards and care for the environment."

For Iadisernia, the future of the sector lies in the use of raw materials based on renewable resources such as solvents and additives for paints, produced from corn and other cereals to replace current monomers. However, it recognizes that these new products also represent a double challenge, since it is necessary to have a complete supply of these foods to be able to use them as substitutes for pre-oil derivatives. "This will not be easy and will require a large investment in technology, creativity and innovation."

Author: Vanesa Restrepo

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