PAINT SUPPLIES AND LOCATION: EXAMINING ICI

https://doi.org/10.24057/2414-9179-2016-2-22-3-19

View or download the article (Eng)

About the Authors

M. Herron

School of Architecture and Built Environment
Australia
Deakin University, Geelong, Victoria, Australia Tel 61+393984308

D. Jones

School of Architecture and Built Environment
Australia
Deakin University, Geelong, Victoria, Australia

J. Godfredson

Victoria University
Australia
Footscray, Victoria Australia

C. Donley

Donley Systems, Colorado Springs
United States
Colorado USA, Tel 1 +303 641-3232

Abstract

How important is location to an international retailer? Not just any retailer but the second largest paint retailer in the world. Imperial Chemical Industries (ICI) was a British chemical company and was at one stage the largest manufacturer in Britain. Formed from the merger of several leading British chemical companies in 1926, ICI makes paints and speciality products, including food ingredients, speciality polymers, electronic materials, fragrances and flavourings. ICI paints purchased the Cleveland Ohiobased Glidden Coatings & Resins (Glidden Paint Company) in 1986 for USD$580 million. The addition of Glidden to ICI's North American operations more than doubled that subsidiary's annual sales to $3 billion and increased ICI's corporate presence in the United States dramatically. A decline in paint and solvent consumption during the 2000 decade slowed the average growth of the paint industry to about 2% annually. Rauch Associates, the leading US paint analyst firm, predicted near-term growth to slow even further to 1.2% per annum. Through the 1990’s and early 2000’s Glidden paint was sold only through Glidden-badged paint stores and smaller retailers under licence, developing a strong identifiable brand and reputation. How were potential Glidden retail paint store locations chosen across America to enable and support this market growth? This paper investigates the real process that was developed and applied to construct a national network of retail outlets across the United States. It also highlights the change in direction that occurred at ICI paints culminating in its eventual acquisition by AkzoNobel in 2008 who immediately sold parts of ICI to Henkel, and integrated ICI's remaining operations within its existing organisation. This sale and the associated corporate restructure caused considerable change in marketing directions allowing for the first time the selling of Glidden paint products to mass market centres such as Home Depot. This change in marketing strategy caused the traditional Glidden retail store network to decline to about 420 stores nation-wide, with the subsequent effect that ICI (Glidden) gave up some of its profit margin to third-partner retailers in exchange for higher sales volume.

Keywords

optimal store location, geographic data, GIS, demographic analysis.

For citation: Herron M., Jones D., Godfredson J., Donley C. PAINT SUPPLIES AND LOCATION: EXAMINING ICI. Proceedings of the International conference “InterCarto. InterGIS”. 2016;22(2):3-19. https://doi.org/10.24057/2414-9179-2016-2-22-3-19