The US paint market is divided into three segments: architectural coatings which is 43% of the market, original equipment manufacturing (OEM) coatings which is 35% and special purpose coatings which is 22%. The U.S paint industry is considered to be a maturing industry. Industry sales in 2004 were estimated to be slightly over $16 billion and average annual dollar sales growth was forecasted to approximate the general rate of inflation through 2005. The architectural coatings are general purpose paints, lacquers used on residential commercial and institutional structures as well as varnishes. These types of coatings are mainly sold through wholesalers and retailers. The OEM coatings are formulated to industrial buyer specifications and they are used for durable goods such as automobiles, transportation equipment, and building products for the industrial industry. Lastly, Special purpose coatings are formulated for special applications or environmental conditions (extreme temperatures, exposure to chemicals). They are used for automotive and machinery refinishing, industrial construction such as factories, railroads, utilities, bridges marine application, highway and traffic machines and roof paints. The architectural coatings sales are distributed evenly between two-market area segments, Dallas fort-worth area and the non-Dallas-fort worth areas. Jones-Blair’s approximate architectural paint and sundry sales increased by 4.3% from 2000 to 2004 according to the information provided in the case. The Jones Blair trade area has the 7 biggest paint combines accounting for 60 percent of all sales. In the Dallas-Fort worth area the 11th county is the major business and financial center to the company’s southwestern area which also brings in 60% of 80 million dollars sold where 60 percent came from the Dallas-fort worth area. Do it yourself and household buyers were believed to account for 70 percent of non-contractor related volume in DFW and 90 percent of non-contractor related volume in other areas. This company is privately owned and produces everything under its own name enabling it to distribute its products through 200 independent paint stores and 8 sales representatives. Industry sources estimate that the number of paint companies is currently 600, or about 40 percent fewer companies than in 1980. The number of paint companies is presently declining at a rate of 2 to 3 percent per year. Major producers of paint for the architectural coatings segment include Sherwin-Williams, Benjamin Moore, the Glidden unit of imperial chemicals, PPG industries, Valspar Corporation, Grow Group, and Pratt and Lambert. These producers account for upwards of 60% of sales in the architectural coatings segment.

About 50 percent of architectural coatings are sold under private, controlled or store brands, sears, Lowes, Wal-Mart, and Home Depot are major marketers of these brands. Industry sources estimate that specialty paint stores account for about 36 percent of paint and sundry sales; hardware and lumberyards account for 14 percent.
The company distributes its products through 200 independent paint stores, lumber yards and hardware outlets. 40% of its outlets are located in the 11 county DFW area. The remaining outlets are situated in the other 39 counties in the service area. Jones Blair sales are distributed evenly between DFW and Non DFW accounts.

The Jones Blairs market area can easily be divided into 3 broad segments which include OEM, Special purpose coating and architectural coating. The Jones-Blair market can be segmented by Do it yourself consumers and consumers who are interested in hiring professional contractors for their work. On top of segmenting those areas you are also able to segment consumers in the Dallas Fort worth area versus the consumers in the smaller rural areas. In all there are four consumer segments for Jones-Blair which include Do it yourself painters in the DFW area, Do it yourself in the other areas like the rural communites, Hired painters in the DFW area and the hired painters in the rural communities.

When we look at the markets that Jones Blair should pursue we are faced with a few markets to look at before jumping to a conclusion. From this case I can see that the Non dallas fort worth households have a high potential for growth. The reason for this is because there is not a large volume of distribution in this segment because of the low population. We then have the nondallas fort worth professional that is already dominant that does not need present any real opportunities for Jones Blair but to maintain a good setting in this segment is well recommended. But the biggest opportunity lies with the urban professionals that are looking for the high quality paint that Jones Blair offers. The reason for this opportunity is because the work a painter does reflects on his future business. A painter’s customer wants high quality work done so the painter should be using high quality products. The professionals are looking for products that are long lasting, and washable paint in which can be applied in one single coat.

For the competitive advantage Jones Blair’s must maintain the customer relationships they currently possess. With the customer relationships they have Jones Blair should also continue to work with the Do it yourself customers that are looking strictly for good service. Something Jones Blair’s provides in how to do certain things when painting which will enable a loyal customer. In addition to the Do it yourself you would also be positioned to help the professional painters that want high quality paints. This will enable professional painters to continue to receive repeat business because of the great job they are able to deliver with such high quality paint.