MicroBlend®, Inc. is an architectural paint solutions provider that has developed an innovative and cost-efficient paint production process based on its proprietary point-of-sale system. MicroBlend’s Automated Paint Machine® (“APM®”) system utilizes a patented, point-of-sale process to dispense paint on demand based on the consumer’s specific requirements. The APM® system utilizes six proprietary pre-paint components, which are combined in calculated proportions to generate over 2,400 paint SKUs, compared to an average of only 500 at typical retail stores. The MicroBlend system significantly reduces the store area required to approximately 200 sq. ft., which has the ability to increase the retailer’s sales per sq. ft. by six to 12 times. The reduction in square footage also significantly reduces inventory and working capital.
Furthermore, MicroBlend’s consumer-driven model has been proven to drive incremental sales and shift sales mix to higher margin paints for retailers. MicroBlend’s system results in a more efficient supply chain and reduces the cost of purchasing, shipping, handling and labor compared to traditional paint manufacturing.
MicroBlend®, Inc. was founded in 1998, as Coatings Management Systems, Inc., by inventor Danny McClain, Randall Hughes and Dan Trevino. Mr. McClain, who gained experience at Sherwin Williams and operated a small paint manufacturing company, invented the breakthrough technology, which in its current form integrates the color tinting process simultaneously with paint dispensing. In 2004, Mr. McClain unexpectedly passed away. The management team continued to improve Mr. McClain’s Integrated Paint System by automating a robust retail production system, improving paint quality and lowering costs.
Point-Of-Sale Business Model
MicroBlend’s point-of-sale production system is significantly more cost effective than the traditional paint production method. The traditional method was developed in the first half of the 20th century and consists of manufacturing paint in a factory which requires substantial labor and overhead for manufacturing large batches of each paint SKU, then filling, labeling, bailing, boxing and palletizing. The paint is then transported to a warehouse or directly to a store in cartons. At the store, the cartons are removed by hand truck and inventoried; the cartons are opened, the cans are removed and the cartons are thrown away. Finally, the paint is placed on shelves or racks and relocated several times prior to purchase. When the paint is chosen by a consumer, it is selected, removed from the shelf, the can is opened, colorant is added, the paint is mixed in a shaker and the product is sold. In the past century, the paint production and distribution process has remained virtually unchanged until the invention of MicroBlend’s APM® technology.
MicroBlend’s patented point-of-sale business model was developed to improve the operating and supply chain inefficiencies associated with conventional paint manufacturing. The business model utilizes approximately 60 chemicals and raw materials compared to an industry average of 100 used in conventional paint manufacturing and groups them into six unique combinations of raw material pre-paint components. Utilizing its proprietary six pre-paint components, MicroBlend’s APM® system produces paint at the point-of-sale, significantly reducing purchasing, shipping, handling, labor and inventory costs. The Company’s point-of-sale business model reduces the required number of steps in the paint procurement and sale process. The traditional production process utilizes at least 12 procedural steps while MicroBlend’s innovative process requires only six.