Customer Information: Raw-Material Price Rises
Customers of Regal are the lifeblood of our business and we feel that it is important to keep you all informed about the current climate in the paint-manufacturing industry.
Unprecedented Increases in Costs
Over the past 12 months paint-manufacturing companies have been hit by an unprecedented rise in the price of raw materials.
This has put us, and all businesses in the sector, under enormous cost-pressure.
Regal’s Retail Prices Have Remained Static
Every ‘ingredient’ in our paint has seen a surge in cost price and the impact has been tremendous on our business and on that of our competitors.
Similar to the construction sector, raw materials have been in short supply or with long lead times. This has meant that it has been quite a task to keep manufacturing; something which we have succeeded in doing.
And despite the rise in costs and issues with the supply of raw materials, Regal Paint has continued to maintain static retail prices of our floor paints, metal paints and masonry paints for our customers.
Our Prices Have to Increase
Unfortunately, the cost pressure has now become so great to our business that we are taking this step to forewarn all our customers of imminent and unavoidable price increases.
Oil and Resin
As you might know, oil prices have more than doubled in twelve months to $83 per barrel, compared to $42 this time last year. And when compared to $20.16 per barrel in April 2020 there has been around a 300% increase.
The resin used to make our paint is derived from oil. According to the British Coatings Federation, the cost of resins and related materials has increased by over 36% in the last twelve months. Epoxy resin, in particular, which is used to make our epoxy floor paints, has gone up by over 100%.
For several months there has been a shortage of epoxy resin and we have had to source supply from all corners of the globe. This is not British problem, nor a European one, but rather something that has hit worldwide. In turn, this results in suppliers diverting products to their own local markets rather than exporting to Europe and so prices get pushed up further.
Solvent costs have increased by a whopping 82%. This is not just affecting the paint industry but has also had a major impact on the ink sector.
Pigments have increase by 10% but we predict that this will see another increase shortly due to changes in the law around pigment use.
Along with the raw materials, most other costs have also seen price hikes. The supply of packaging, such as corrugated-cardboard boxes, virtually dried up earlier in 2021 as more and more people sought to buy online. Huge worldwide demand, especially from China, along with dwindling supplies, pushed up prices again and again.
Paint cans haven’t escaped either. The 5 litre cans we buy have increased by 30% since January 2021 and a barrel (drum) by 40%.
There have been price increases in carriage charges too. We never make a profit on carriage as we only ever pass on the cost that we are charged by the courier companies. With the sheer volume of parcels being delivered all over the country and the need for the couriers to take on more staff, transport businesses have also been squeezed. This has resulted in price increases.
Fuel and Energy
We are no different to any home and need to use gas, electric and petrol/diesel….we all know what the crack is with prices there.
We Promise to Keep Price Rises as Low as Possible
The cost of resin and a continued instability in raw material supply means that the prices are the highest we have ever seen and are likely to remain very high.
Sadly, this leaves us with no option other than to increase our retail prices on all products.
Please be assured that we will try to keep price increases to a minimum.
We also remain committed to sourcing and using only the best raw materials in our paints.
From all the team at Regal, thank-you for your continued custom, support and understanding.