How the Russian market of waterproofers, glues and sealants is divided

How the Russian market of waterproofers, glues and sealants is divided
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Top-manager of the Bostik company has analysed the situation in the market of waterproofers, spoke about the rivals of the company and shared the plans for the future

Evgenia Vinpal, Marketing Director of Bostik company in Eastern Europe, answers the questions of our magazine

— How do you assess the current situation in the Russian market of waterproofers and construction chemicals?
— The construction market, and the market of waterproofers in particular, keeps developing. We assess the rate of growth as 10—15% a year. The market is very interesting and provides a lot of opportunities: many commercial and housing objects are being built. Our company deals with production of materials for adhesion and joint sealing, including the solutions in waterproofing. That is why we consider the Russian market very attractive.

— What are the most noticeable tendencies in the market from your point of view?
— A bias towards service and material quality increases is taking place now, and it is very important for us because we give priority to reliability, technologies and high quality of service. Besides, new high-tech materials are appearing, and many of them have started to be produced on the territory of Russia. It is big progress for Russia.
Many different programs have been started, and both international and Russian companies are developing the market, offering new products and solutions. In this respect Russia keeps pace with other countries, and this means that we are on the right path.

— How does the current crisis impact your company’s activity?
— The process is different in different regions of the world. Some markets keep growing. We now have active and even growing markets – e.g. India, South America. As far as Russia is concerned, the situation is ambiguous. But the majority of market players are optimistic about the future, and we are among them. To remind you, for more than a hundred years our company has survived several world crises. We have enough experience which helps us to actively develop on the Russian market.

— Who do you consider your rivals in the Russian market, in the segment of waterproofers, sealants and glues in particular?
— Many players are present here. There are international companies: Sika, MAPEI, BASF, — and large Russian producers such as “TechnoNicol” (they are just developing the market).
The market is rather complicated but we are not afraid of competition, as we have unique solutions and understanding of our customers’ demands.

— What waterproofing technologies provide solutions for complex construction tasks, saving both money and time for the customer?
— From the point of view of new technologies, the specific character of waterproofing is that different technologies are used in it: cement, polyurethane resin, epoxies, polymeric compositions. We manage to achieve good results due to technological diversity.
The one who offers complex systems, consisting of several components and which is able to solve a big number of tasks in the sphere of waterproofing wins in the struggle for customers.

— How responsive is the Russian market to advanced technologies?
— Modern solutions find their consumers. Despite the fact that the process may take a long time, the progress is quite noticeable. New technologies are developing in Russia. For example, in the production of bitumen traditional technology gives place to high-tech solutions.

— The main economic problem for the Russian producers of glues and sealants, by their own words, is the high prime cost of the product and the low release price. Is this the direct consequence of imported components prevailing?
— It is difficult to access the price forming policy of a company. Each company pursues its own policy: some work with high gain, others – with low. Every company has its own strategy of entering the market; it’s hard to average it. The most important thing for every company is to achieve optimal correlation of quality and price for the end user. And many try to find this balance.
There’s no secret that the modern world is moving towards a search for new solutions. Primary materials change, and their prime costs rise. That’s why chemical companies develop new technologies allowing them to avoid raw materials price increases and switch over to cheaper technologies, preserving quality.

— What price segments does your company refer to – in waterproofers, sealants and glues?
— We have several trademarks. For example brand the QUELYD is widely represented on the Russian market in the segment of decorative glues. Bostik brand products are mainly for professional users.
We always try to be closer to customers. Of course, there are more expensive materials, because they include complex compounds. It results in advanced materials of high quality, but they are hard to be offered for a lower price. We try to optimize price formation: we have products both for common users in the medium price segment and in higher segment.
The market’s latest tendencies show that much has changed; customers tend to move to other price segments and also look for optimal decisions. Our task, as a big market-player is to follow customers’ demand. We diversify our portfolio, using the approach that we call “Good, Better, the Best”.
“Good” is a good basic simple solution available for a common user. “Better” are more technologically advanced products. “The Best” are premium solutions, rather complicated in their structure and aimed at a perfect result. In this sense they are at the top of the pyramid. Thus, we try to cover all niches.

— In spite of the crisis, your direct competitor, the Sika company, is going to build a new plant for dry building mixes production in Volgograd – they announced it recently. Do you have production localization in your plans? It is difficult to win the customer without it.
— Production localization gives an opportunity to responds to the changing conditions of the market. We consider this opportunity first of all for reducing the distance between the production and the customer. Russia is a country of great potential and peculiarity, thus it demands a special approach.

— Last February your company entered the French chemical group Arkema as its subsidiary (Bostik was bought from French oil and gas holding Total). Why does one of the world leaders in the production of glues and sealants integrate with other companies?
— It is very logical from the point of view of business. Arkema is a holding producing chemical raw materials, i.e. it is located in the beginning of the “product - consumer” chain. The Bostik company, producing adhesives and sealants, is closer to the final user. Besides, the Arkema scientific centers’ expertise will help Bostik in the development of new multifunctional advanced adhesives, which are more than glues. Thus, we catalyze our capabilities to offer an optimal decision to the customer.

— Does that mean that in the result of integration you became a leader in the adhesives market?
— For 125 years we have passed a long way. There were many different reorganizations. For many it is a natural way of development, when business is enhancing, integrating and thus entering new markets. That’s why we consider the purchasing of our company by Arkema holding to be the next step in our development.