The idea of this article came to me on board of a flight from my business trip from London to Athens, after a week spent with Etalon’s customers in Ireland and the United Kingdom. I was thinking about the differences between the Great Britain and the continental Europe in various aspects of life. You can not underestimate the old British empire and its influence on Europe (and the whole world. This relatively small island has always been in avant-garde of history. If you are in doubt, just think of the language you use while traveling to any part of the world. Do you speak English? With the procedure of Brexit triggered, the glorious Kingdom has to renegotiate its place on the political and economic map of the old world.
Of course, my article is not about politics. I would like to share with you my views about the automotive body and repair business in the UK in comparison to the rest of Europe.
Consolidation of coatings suppliers
For those who are not familiar, automotive paint supplies stores in the UK are called factors or motor factors. Firstly, I would distinguish a very high level of consolidation in the UK paint supply chain, with groups like Morelli Group, Movac Group or LKQ to be very sizable and hungry for growth. While consolidation is not completely unknown in Europe, it is still going in slower pace. Secondly, the corporate groups, like above mentioned, have tremendous purchasing power. They strike deals with manufacturers directly, pushing out of business the smaller players.
Types of factors
In the UK you will see more and more companies with spare parts trade background, which incorporate refinishing departments in their business structure. Supplying spare parts is a business with high entrance costs; it requires fine-tuned logistic departments, big warehouses and a fleet of the delivery vehicles. With all this set up, they try to achieve much needed growth by supplying paint and consumables as well. Of course, this affects greatly the traditional paint-only stores.
Many of my colleagues from other countries believed that the British market price levels are on the high side. You will be surprised how low the prices are for many essential consumables. Probably it can be explained by the extremely high competition, and, by the levels of the consolidation, I mentioned already. When the large groups manage to negotiate large deals with the manufacturers, inevitably their smaller rivals will search for supplying solutions from the lesser-known brands. In addition, you will see many cheap private labeled products in white boxes on the shops’ shelves. Therefore, prices for many materials are bottom low.
When I look at the shelves with body fillers, I think of the United States. Just like across the Atlantic, in the UK, a traditional body filler is usually lightweight and comes in tall 3-liter cans. You will not see much of flat 2kg or 1L tins, which are so popular in Europe. A lot of the body fillers I tried, required a thin layer of glaze to be used to close pinholes. Also, very “American” thing. In the mainland Europe we see predominantly universal (filling and finishing) putties in use.
Fast is the keyword
I supply paint products to various countries with very diverse climate conditions, but what surprised me most in the UK – a demand for the fastest possible curing primers and clearcoats. We had to introduce extra fast hardeners to all of our two pack materials! Nothing was quick enough. I have seen a painter mixing an express clearcoat with extra fast hardener, adding accelerator and fast thinner. How is that? Of course, speed comes at cost of quality, but this is a subject for another discussion.
On the other hand, you should also consider the very high levels of humidity in certain regions, which affects negatively curing times of 2K materials. In addition, plenty of smaller bodyshops avoid using a spray booth for drying to save on energy costs.
After Brexit era
Automotive refinishing business in the UK is very dependent on imports. Therefore, uncertainty is very high. What will be the customs duties? What additional costs will the customs procedures bring along? How the payments of VAT upfront upon the goods arrival will influence the cash flow of distribution? What about the border between Northern Ireland and Republic of Ireland? Too many questions, no answers so far. Perhaps a bit of English humor will help our friend in the UK to overcome all the obstacles.