How are the companies in the adhesives industry dealing with the lingering economic crisis? What do they think of setting-up regionally based testing centres? How is the market appreciating product innovations and advancement in the sector? Jerome Sanchez reports.

The adhesives industry is very promising in the Middle East, with the adhesives market for ducting alone being worth approximately $100 million. Nabeel Awan, Managing Director, Napco Middle East Ltd, valued the overall adhesives industry at $500 million, with Saudi Arabia, UAE and Qatar getting a majority of the market share. Based on the figures given, albeit estimated, the market size of the adhesives industry in the Middle East is substantial, and the use and applications of adhesives in the region are critical.

In these times of global economic crisis and increased pressure for better efficiency and improved quality, businesses are continuously striving to stay alive, achieve better market share, and comply with the new demands and standards set by the industry. Besides asking Awan, Climate Control Middle East spoke to several other key industry players how their companies were coping with the lingering economic downturn and how the market was receiving the introduction of higher-priced products that promised more value and better quality of living.

BATTLING THE CRISIS

The players agreed that the economic crisis had, indeed, affected not only the adhesives industry but also the whole HVAC industry. They were, however, optimistic and reported that their respective companies had strategies in place to combat the present downturn. As Sal Fasanella, Products General Manager, Carlisle HVAC, put it: “Our focus in these troubled times has been in areas where there is little competition. We have achieved this by innovating new products and solutions that do not exist but are needed in our industry.” Awan said that market and industry diversification, increase in export, and development of products for industrial applications were the keys to surviving the present economic situation. Ajit Abraham, Divisional Manager, HVAC, Leminar Air Conditioning Company, on the other hand, suggested a more personal approach. “We meet our clients and contractors to find out how we can provide them solutions and meet their requirements,” he said.

Despite the economic situation, however, they said that companies in the industry were still looking at expanding their market presence and venturing into new locations and areas. Awan revealed that Napco was currently exporting to approximately 25 countries, with distributors present in every country that they exported to. “We are currently not planning to venture into the UK market as of now, since it is really bad at the moment,” Awan said. “Venturing into Eastern Europe, perhaps Turkey, is more of a possibility,” he said. Abraham, however, said that Leminar was keeping its expansion within the GCC. “Our Oman outlet has just opened, so we are more interested in expanding in the GCC,” he said. “Africa is a potential market, but not at the moment.” Fasanella gave a hint to Carlisle’s plans by simply stating, “We are interested in expanding current markets as well as looking to open new markets.”

INNOVATING IN TRYING TIMES

All three were united in saying that, in spite of the shrinking market, their companies had not stopped innovating and working to offer better products to consumers. Fasanella said that Carlisle had developed a solution for retrofitting existing buildings. “The concept is basically a series of products and equipment that can seal the interior of the ductwork,” he said. “Our process allows a robot, called ISAAC, to spray specially engineered products from the interior of the ductwork, therefore eliminating the need to tear down walls of ceilings,” Abraham and Awan answered in the same perspective, saying that improvements in their products, such as reduction in VOCs, were motivated by new green building standards, international quality and efficiency specifications and rating systems, such as LEED and Estidama.

Improvements in their products were also geared to address some key maintenance issues, including air leakage; presence of dust and debris; and growth of moulds, microbes and fungi. “We have created specialised anti-fungal coatings that protect the surfaces exposed to high humidity,” Awan said. Speaking for Carlisle, Fasanella said: “The presence of moulds in a duct system is eliminated when the food for the mould – microbes and fungi – are not allowed to enter the duct system. The ISAAC robotically applied products seal the duct openings in the duct system, thus not allowing the mould to get into the ducts. Carlisle sealants have chemicals in the formula that will prevent mould in the wet state and, once dry, will not become food for the mould.”

Abraham provided a broader perspective to the issue. He said that the maintenance issues could be addressed through proper installation and good quality products. He mentioned that products to be used in this application should be tested and approved by governing bodies, including Dubai Municipality and Civil Defense, and must comply with standards like the American and the British standards.

PASSING THE TEST

In line with the question of quality and standard compliance, the respondents elaborated on their testing regimen. “Our laboratory in Texas tests and benchmarks current products with others supplied in the area,” Fasanella said. For Leminar, Abraham said that the products they supplied were tested and approved by the Dubai Municipality and Dubai Civil Defense. Awan, on the other hand, said that the contractors and consultants they dealt with, assigned the testing centres, and that they usually sent the products to Canada or to the UK for testing.

The answers, however, were conflicting when the three were asked about their take on setting up regionally based testing centres. “Consultants, contractors and the government should push for a regionally based testing centre,” Awan said. “Cost-effective, regionally based testing centres will help improve quality of products. The government should push for high-quality products, and the contractors should advocate quality.” Added Abraham, “Regionally based testing centres help you find out if products adhere to regional requirements.” Fasanella, on the other hand, maintained that Carlisle did not find the need for a regionally based testing centre, and that their testing facilities were “quite capable with this type of testing”.

LUKEWARM WELCOME

When asked how the market was receiving and giving importance to these product improvements and innovation, against the cost of procurement and ownership, the respondents gave differing answers. “The market is maturing, but as of now, I can say that 60% of the market still gives premium to cost instead of to quality,” Abraham said. Added Fasanella: “This depends on where the products are sold. In the past, it was all related to cost; however, in the Middle East, we are starting to see a shift to safer products. Awan, however, decisively answered that consultants and contractors had their quality specifications and that they procured products that complied with their set standards.

CONCLUSION

Companies in the adhesives industry agreed that the economic downturn had affected their businesses, in one way or another. Some made their way through, while others succumbed to the crisis and to the increasing pressure to innovate and meet new industry quality and efficiency standards. Working with stakeholders, innovating to produce better and more reliable range of products, meeting industry requirements, complying with the new set of quality standards, and finding solutions to problems no one thought existed, were the strategies some companies adopted to thrive in these trying times.