Disenchantment regarding politics and the EU on the part of SME colleagues is understandable”

Please describe the market in Luxembourg.

Gérard Zoller: Apart from ourselves in Luxembourg there is only Couleurs Gérard Sàrl, a small family-run business. There are no reliable figures on market size. Encouraged by construction activity, however, a number of coatings manufacturers are muscling their way onto the market. But they are wildly over-estimating its size.

For this reason, we can’t rely only on Luxembourg, and so we cast our net wider to cover an area of radius 120 km around our location in Useldange. This means that our home market consists of four countries, namely Luxembourg, Germany, Belgium and France.

What are the specific challenges facing your company?

Zoller: Leaving aside Luxembourg, we are operating in three different countries, and that is where the difficulties begin for an SME like us. Customers are often unhappy with European-wide labels, and demand national labels instead. Unlike corporations and larger companies, we have difficulty affording these. The European market doesn’t really work for us. The labelling issue clearly impedes our ability to export.

We also find expansion to be very difficult. If we want to open another branch, we are forced to go abroad. We then have to familiarise ourselves with the fiscal rules and all the other regulations. It is often claimed that Europe exists and works – but that’s not true for every company.

Another major challenge is the implementation of European directives. We, with just over 100 employees, have to meet the same requirements as a large corporation with more than 1,000 employees. That’s a burden which is often underestimated. So we can well understand and relate to the disenchantment felt by some SME colleagues about politics and the EU.

How strong is your focus on export?

Zoller: The small size of the market forces us to export, because we have reached our limits here. Exports already generate 30% of our sales. We will increase this figure even further in the future. That will require us to focus more on the neighbouring countries. But naturally nobody has been hanging around there waiting for us to call upon them. We therefore need to build up reliable partnerships that will enable us to expand our activities in these countries.

Which business areas do you want to expand?

Zoller: We produce our own architectural paints, industrial paints and wood coatings. We are an exclusive distributor of automotive refinishes. We also do traditional contract manufacturing, which is a growing business area for us. We’ve found that these types of orders are now being processed more quickly. As soon as the secrecy agreements are signed, everything runs fairly quickly and smoothly. Contract manufacturing currently contributes 20% to our annual sales, but we want to keep growing in this area and still have free capacity which we want to utilise.

You recently obtained certification for your bio-based interior wall paint. How do you assess the potential of these products?

Zoller: We decided at the time that we wanted to move away from petrochemical-based raw materials. We have now developed vegetable oil-based paints which have also attained Cradle2Cradle certification. Until we can reach the population at large, however, we will have to subsidise this product. But we do intend to further expand our range. Customers prefer ecological products if they are not more expensive.

The prices and the availability of raw materials for biobased products are also a major obstacle for us. We’re competing here against the food industry and some of the population take a dim view of this.

We condemn the labelling scams which pervade the market, but regrettably they are why bio-labels are falling into disrepute.

You’re celebrating your company’s 90th anniversary this year. Which projects are planned in the foreseeable future?

Zoller: Our headquarters is bursting at the seams. We are building two new logistics halls. To this end, we are making investments in the low double-digit million range.