Tikkurila's business model

Sustainable beauty since 1862

We provide consumers and professionals with user-friendly and sustainable solutions for the protection and decoration of surfaces. We are committed to actively developing high-quality and eco-efficient solutions.


Our business model describes our way of obtaining profits in our operations. Our business model highlights strong brands, generated through high-quality and long-term product development and considerable marketing investments. In addition to the strong brands, important factors in our operations include a functioning and extensive distribution network, diverse services and an efficient supply chain.


Brands

Our brands are among the best known in the market. We have expanded our operations by means of significant acquisitions which have provided us with very strong local brands. We adhere to a multi-brand strategy: we position our brands by means of pricing, quality images, packaging, distribution and product properties. Each brand typically targets a certain customer segment and a certain price and quality grade. Thanks to the multi-brand strategy, we are able to successfully compete in all our selected price and quality grades and to offer a product and service portfolio which meets customer needs. Strong brands and innovations are key in achieving our growth target. We work to understand the needs of our customers and help them succeed in their surface protection and decoration projects.  When we look at things from the end users' perspective, we are able to make their lives easier and inspire them. Our business operations are also about making customers happy: by motivating them to beautify and modernize their environment we can help them feel better.


Paint_business_success_factors
Strong brands, efficient and comprehensive distribution, as well as leading market positions are the key success factors in paint business.


Functions

As a paint industry player, we are positioned between raw material and packaging material suppliers and retail in our value chain. We sell decorative paints primarily to paint wholesalers or retailers and directly to construction supply stores. In addition, we have our own stores in Scandinavia and Russia. We sell industrial coatings either directly to customers or through our Temaspeed retailer network.

 

 

Value chain

Illustration of Tikkurila's value chain.

 


Our key raw materials include pigments (above all, titanium oxide), binders, thinners, additives and packaging materials. Raw materials play a key role in the operations of paint manufacturers since raw materials and packaging materials account for a half of our revenue, on average.


Key functions in our own operations include the following:

  • Supply chain
    • Procurement and logistics (procuring and receiving raw materials and packaging materials, transferring them to production, warehousing, order management, distribution management)
    • Paint production (manufacturing paint using the raw materials specified by product development)
  • Research, product development and innovations (developing new products and services, improving product properties, development work related to raw materials and formulas)
  • Sales and marketing (identifying customer needs, marketing, sales, participating in the development of services and products, pricing, retail management)
  • Services (ideas, color and painting guidance, training, technical customer support, search services)

Each of these functions is important in terms of our competitiveness. Our competitive edge stems from our leading market position and brands which we work to strengthen further through innovations, marketing, services and an extensive service network.