Paintball in the CEE
And though current number one, Kalon BV-controlled Polifarb Cieszyn, which has its own plans for development in the region, is confident it can maintain its advantage, analysts are less sure.
Śnieżka's IPO at the end of last year was intended to raise zł.45 million to fund a local acquisition and the construction of a production plant in Ukraine. Poland's eastern neighbor currently brings in 80 percent of the group's export sales and the company's two subsidiaries there have seen incomes growing at rates of 30 percent over the last two years. "The situation on the Ukrainian market," according to Sebastian Słomka, analyst at BDM PKO BP, "is much like the situation on the Polish market in the 90s, when there was double digit growth."
The Ukrainian plant is also intended to supply the Russian market, taking advantage of customs agreements between Russia and Ukraine, while plans for further expansion throughout the fast developing markets of the ex-Soviet region have been stimulated by growing sales in Belarus, where the company has also set up a subsidiary.
"Our expansion plan relies on the creation of partnerships with chosen distributors on local markets, based on years of co-operation," says Tomasz Krzak, CEO of Śnieżka. The firm envisages the creation of subsidiaries in Russia and Moldova which would also provide a base for pushing sales into Kazakhstan and Romania respectively. Later plans also see moves into the Czech Republic, Slovakia and Hungary.
"We aim to become a leader on the CEE market," says Krzak, though the company has no plans to move into Western Europe as yet.
"They [Śnieżka] prefer to target post communist markets where they feel that their domestic experience will be more applicable," says Słomka.
According to Roman Podgorski, press-spokesman for domestic market leader Polifarb Cieszyn, though, Śnieżka won't be having everything its own way. Since last April, Cieszyn itself has been operating a plant in Ukraine bought up by its Dutch-based parent company Kalon BV, and has its own plans for expansion into Russia. The company was unable to provide figures for their sales in the Ukraine, but claims that they are growing fast.
On the domestic market, Polifarb Cieszyn, which currently controls 30 percent of the market compared to Śnieżka's 11 percent, has also been investing in distribution with the aim of countering the meteoric rise of Śnieżka, which in 2002 saw sales increasing at a rate of 28.6 percent to Polifarb Cieszyn's 5.5 percent. Already the firm has seen some improvements, with sales incomes increasing at a rate of 8.6 percent in 2003.
The two firm's strategies differ markedly, however. Śnieżka's offensive on the local market is based on one brand and the maintenance of an on-going price promotion, which, according to Słomka, "The company sees as a necessary investment to win itself the market share to move from number two to number one." How the company plans to hold onto consumer loyalty when prices go up, however, Mr Krzak was unwilling to say.
Polifarb Cieszyn, meanwhile, is focusing its energies on its flagship brand, Dekoral, whose products are based within the middle- and upper-shelf segments, creating a network of brand outlets known as Studio Dekoral, of which the company now has 207 with another 130 planned for this year. The company is also launching an intensive brand promotion campaign in the media.
"Studio Dekoral offer not just paint, but also ideas, advice and computerized colour solutions to help customers plan their interiors," says CEO Arnold Peterse.
In his view, Kalon's strategy anticipates future market trends on the Polish market, which have already been identified throughout Europe.
Sebastian Słomka, however, is skeptical.
"80 percent of the domestic market is for lower-shelf products, where Śnieżka has positioned most of its brands," he says. In his view, Polifarb Cieszyn's strategy of developing middle- and upper-shelf products of the Dekoral brand will make it hard for the Dutch owned company to defend its market share as Śnieżka's popular assault hots up, especially considering that in this segment Śnieżka's brand is much better known than that of Polifarb Cieszyn, 'Cieszynka.'
Yet Arnold Peterse is confident, "Our strategy is based on Sigma Kalon's Pan-European experience and is already showing some local success."
Śnieżka's IPO at the end of last year was intended to raise zł.45 million to fund a local acquisition and the construction of a production plant in Ukraine. Poland's eastern neighbor currently brings in 80 percent of the group's export sales and the company's two subsidiaries there have seen incomes growing at rates of 30 percent over the last two years. "The situation on the Ukrainian market," according to Sebastian Słomka, analyst at BDM PKO BP, "is much like the situation on the Polish market in the 90s, when there was double digit growth."
The Ukrainian plant is also intended to supply the Russian market, taking advantage of customs agreements between Russia and Ukraine, while plans for further expansion throughout the fast developing markets of the ex-Soviet region have been stimulated by growing sales in Belarus, where the company has also set up a subsidiary.
"Our expansion plan relies on the creation of partnerships with chosen distributors on local markets, based on years of co-operation," says Tomasz Krzak, CEO of Śnieżka. The firm envisages the creation of subsidiaries in Russia and Moldova which would also provide a base for pushing sales into Kazakhstan and Romania respectively. Later plans also see moves into the Czech Republic, Slovakia and Hungary.
"We aim to become a leader on the CEE market," says Krzak, though the company has no plans to move into Western Europe as yet.
"They [Śnieżka] prefer to target post communist markets where they feel that their domestic experience will be more applicable," says Słomka.
According to Roman Podgorski, press-spokesman for domestic market leader Polifarb Cieszyn, though, Śnieżka won't be having everything its own way. Since last April, Cieszyn itself has been operating a plant in Ukraine bought up by its Dutch-based parent company Kalon BV, and has its own plans for expansion into Russia. The company was unable to provide figures for their sales in the Ukraine, but claims that they are growing fast.
On the domestic market, Polifarb Cieszyn, which currently controls 30 percent of the market compared to Śnieżka's 11 percent, has also been investing in distribution with the aim of countering the meteoric rise of Śnieżka, which in 2002 saw sales increasing at a rate of 28.6 percent to Polifarb Cieszyn's 5.5 percent. Already the firm has seen some improvements, with sales incomes increasing at a rate of 8.6 percent in 2003.
The two firm's strategies differ markedly, however. Śnieżka's offensive on the local market is based on one brand and the maintenance of an on-going price promotion, which, according to Słomka, "The company sees as a necessary investment to win itself the market share to move from number two to number one." How the company plans to hold onto consumer loyalty when prices go up, however, Mr Krzak was unwilling to say.
Polifarb Cieszyn, meanwhile, is focusing its energies on its flagship brand, Dekoral, whose products are based within the middle- and upper-shelf segments, creating a network of brand outlets known as Studio Dekoral, of which the company now has 207 with another 130 planned for this year. The company is also launching an intensive brand promotion campaign in the media.
"Studio Dekoral offer not just paint, but also ideas, advice and computerized colour solutions to help customers plan their interiors," says CEO Arnold Peterse.
In his view, Kalon's strategy anticipates future market trends on the Polish market, which have already been identified throughout Europe.
Sebastian Słomka, however, is skeptical.
"80 percent of the domestic market is for lower-shelf products, where Śnieżka has positioned most of its brands," he says. In his view, Polifarb Cieszyn's strategy of developing middle- and upper-shelf products of the Dekoral brand will make it hard for the Dutch owned company to defend its market share as Śnieżka's popular assault hots up, especially considering that in this segment Śnieżka's brand is much better known than that of Polifarb Cieszyn, 'Cieszynka.'
Yet Arnold Peterse is confident, "Our strategy is based on Sigma Kalon's Pan-European experience and is already showing some local success."
