Shanghai: Nippon Paint China, long one of the fastest-growing players in the coatings industry with about 800% revenue growth over the past 20 years, is now retooling its growth strategy to adapt to changing market dynamics, the company’s CEO Eric Chung told a media company in an exclusive interview.
Since joining the company, Chung has overseen Nippon Paint’s transformation from a traditional paint supplier with roughly CNY 3 billion (about USD 428 million) in annual revenue to a broader solutions platform generating more than CNY 25 billion (around USD 3.6 billion).
However, the China decorative coatings segment — which accounts for over 80% of revenue — has recently faced demand pressures due to a significant slowdown in residential construction activity. Data from China’s National Bureau of Statistics show new residential construction fell sharply year-on-year, reducing demand for architectural paints.
To counter this downturn, Nippon Paint China is pivoting its business model and product mix. Whereas past growth relied heavily on a “channels plus brand” strategy focusing on tier-one and tier-two cities, the company is now prioritising innovation and services as key differentiators.
A centerpiece of this shift is the “Magic Paint” artistic coatings offering — a premium product designed to mimic natural materials such as stone and fabric and delivered through trained and certified applicators dubbed “magicians.” By standardising both product and application, Nippon Paint aims to create stronger consumer value and new revenue streams beyond basic paint sales.
The company has established training and certification programmes across China, with more than 6,000 certified magicians already trained and plans to scale this to 60,000 workers, combining service delivery with digital tools and AI-enabled training.
Beyond decorative coatings, Nippon Paint China is also expanding into industrial segments, including automotive, aerospace and advanced manufacturing coatings, which have shown resilient demand and higher margins. The firm has opened a major automotive coatings base in Tianjin and is building partnerships with leading Chinese universities and global materials players to strengthen R&D.
Chung noted that while near-term performance might be modest, the longer-term outlook through 2027 remains positive if the company successfully leverages its differentiated service-plus-product model and gains share in new industrial categories.
Despite recent headwinds, Nippon Paint China retains a leading industry position, and the company’s strategic pivot reflects broader trends in the coatings sector where service integration and innovation are increasingly essential for sustainable growth.