Tinashe Makichi Business Reporter
PLAYERS in the paint industry have failed to meet the 60 percent capacity utilisation target set by the industry since the dollarisation of the economy, an official in the industry confirmed yesterday.
The industry players have bemoaned the growing influx of imported paints and liquidity challenges on the market which has led to the recent slump in capacity utilisation among different paint manufacturing companies.
The paint manufacturing industry is currently dominated by Astra Industries Limited and Dulux Zimbabwe.
Competition and Tariff Commission of Zimbabwe this year said most local industries were in their infancy due to the hyperinflation that affected Zimbabwe since year 2000, and industry was in dire need of protection from foreign competition until such a time as they can stave off competition.
In an interview with Herald Business, Astra Industries managing director Mr Mackenzie Mazimbe said the paint industry has been under threat from global factors.
“The industry targeted 60 percent capacity utilisation but for now as industry players, we have not been able to meet that figure due to liquidity challenges.
“It has proven to be difficult to deal with imports considering that as the industry, some of the players have been operating below the standard production capacity. In addition to that demand has been softer lately,” he said.
He said the paint industry was currently on 35 percent capacity against the targeted 60 percent.
Mr Mazimbe said the issue of disposable income has also been another huge hindrance to growth in the paint industry considering that there have not been big projects currently taking place.
He said paint companies should not look for too much protection from Government but should come up with initiatives that boost their competitiveness, because everything has gone technological.
Mr Mazimbe said Astra was operating at 35-40 percent production capacity. He, however, added that by next year the group would be able to ramp up production.
He said Astra is currently re-orienting its business model through coming up with latest branding and new marketing strategies that will cater for all consumers on the market
This year, Japanese paint manufacturing giant Kansai Plascon acquired 49 percent of the Reserve Bank of Zimbabwe’s 63 percent stake in Astra Industries in a deal worth US$5,5 million.