Interview with Ozan Kaya, Board Member of Halimoğlu Fasarit Boya

We had an enjoyable interview with Ozan Kaya, Board Member of Halimoğlu Fasarit Boya. Kaya recounted the history of Halimoğlu Fasarit Boya, which has been operating continuously for over 50 years, and provided information about the new products and technologies it has brought to the sector.

Could you briefly tell our readers about yourself, your educational background and professional experience?

I belong to the second generation of Halimoğlu Fasarit Boya. I completed my undergraduate education in Business Administration at Marmara University Faculty of Business in 1999; I completed my master's degree in Production Management and Marketing at Marmara University in 2002. I prepared a thesis titled "Distribution Channel Selection in Enterprises, Factors Affecting the Selection and an Application in the Paint Sector." With the advantage of studying in the evening program, starting from my university years I had the opportunity to work at various levels of the company. I continued my work at the company following positions as sales representative and sales manager, and currently serve as a Board Member.

Could you provide information about the founding process of Halimoğlu Fasarit Boya and the stages it has gone through to reach today? What technologies and products has Halimoğlu Fasarit Boya brought to the sector?

First, I would like to tell you about the founder of our company, Ersin Çelik. In 1958, he began his education at the State Applied Fine Arts School (TGSO), now known as Marmara University Faculty of Fine Arts. During that period, within the framework of student exchange programs being newly implemented, foreign instructors came to Turkey from abroad, while some Turkish students had the opportunity to go abroad. During this period, the renowned German muralist and instructor at Stuttgart Academy of Fine Arts, Hans Baurle, was also Ersin's teacher at the State Applied Fine Arts School. When Baurle returned to his country, he provided internship opportunities in Germany for four Turkish students. Ersin was one of these fortunate students. In 1962, in his early twenties, Ersin, after his studies in Turkey, had the opportunity to deepen his education both theoretically and practically under the supervision of Hans Baurle in Stuttgart. Hans Baurle was a very accomplished muralist and sculptor. Ersin worked with his teacher on relief artistic works on the walls of the city's metro stations. Meanwhile, he had the opportunity to become familiar with Western art up close and see contemporary art museums. This opportunity opened a great window for him at that time. It is 1964 and Ersin is now back in Turkey with the knowledge he has acquired, and in service to his country.

This company is still one of the largest and most respected producers of paint rollers and brushes in our country.

Upon returning to Turkey, Ersin founded Ersin Dekorasyon company focusing on decorative paints and their application. The question of why the decorative paints and relief paints he saw in Germany should not be applied in Turkey led to the creation of Fasarit, which remains our company's flagship product today. Fasarit is a decorative coating material sprayed with the aid of a compressor and spray equipment, which covers plaster defects on ceilings and all types of wall surfaces, creates a decorative appearance, and reduces echo in the space by diffusing sound waves. Additionally, at a time when whitewash brushes were used in our country, Ersin initiated the use of paint rollers for the first time and, by providing roller samples he brought from Germany to one of the companies producing brushes at the time and giving guidance, he started the development of roller manufacturing and industry. This company is still one of the largest and most respected producers of paint rollers and brushes in our country. From 1964 to 1972, Ersin handled both the application and sale of the materials he produced. Fasarit became well-known throughout Turkey, and found wide application in mass housing, apartments, cinemas, display windows, shopping arcades and many other places where it was constantly in demand. Our product became the only choice due to its ease of application and use and cost advantages in mass housing construction together with Turkey's first mass housing project, the Merter Simitaş Blocks, and in the following years in mass housing projects built with the tunnel formwork system that Mesa İnşaat began implementing in Turkey.

"Fasarit became well-known throughout Turkey, and found wide application in mass housing, apartments, cinemas, display windows, shopping arcades and many other places where it was constantly in demand."

Thanks to Fasarit, classical plastering applications were eliminated in tunnel formwork construction, construction periods gained tremendous speed, and it became a savior in this field. After constructions were directly built with tunnel forms, classic plastering was eliminated and Fasarit was sprayed directly and then painted, which gave incredible speed to the housing production process. Imagine that a master and an apprentice could cover 350-400 square meters in a day with Fasarit, and obviously this was not possible with traditional plastering. Later, in the 83-84 period, we received a request from Mesa İnşaat saying "Can you make a product to repair segregations in concrete, that is surface pores that occur after tunnel form casting?" We developed acrylic-based interior and exterior wall putties. We can say that we are pioneers in the putty field in Turkey and the best at it. Many paint companies' wall putty production is carried out by us, approximately more than 10 companies. Our putty products are in high demand and well-liked. In addition, at the beginning of the 1980s, for use in painting over Fasarit that was sprayed on ceilings, we carried out the first production of ceiling paint in Turkey with the slogan "Goodbye to whitewash." Until then, whitewash was used in these areas. This first product in its field was filled in green-colored metal containers. Even today, green-colored packaging similar to what we used is used by many companies producing ceiling paints on the market.

"All of them are products that bring outstanding solutions to the surfaces where they are applied."

Our work has naturally been based on mass housing, so we have more sales in construction projects through subcontractors and contractors. There were paint companies that bought our products under their own brand and sold them. One of them introduced the product to hardware stores, so it was perceived as if they had produced it themselves. But the reality is different. The first production in Turkey belongs to us. Also, with the idea of eliminating plastering on external facades and accelerating housing production, our textured external facade paint Rustik was created. The production in this field was also the first carried out by us in Turkey. In summary, we have brought 4 products to the sector that are first in their field. These are: Fasarit, ceiling plastic paint, textured external facade paint, and acrylic-based interior and exterior wall putties. All are products that bring outstanding solutions to the surfaces where they are applied. Today, our products are used through subcontractors and contractors, directly at construction sites. We work on a project basis; we do not have our product in the hardware store sector, our products are aimed at industrial consumption. Technical products for housing and construction industry, products that cover plaster defects, particularly Fasarit application which requires skill and tools. By 1984, with the addition of family member Ergun Çol, Ersin Dekorasyon company became Halimoğlu Fasarit Boya and San. Tic. Anonim Şirketi.

What is the current structure of Halimoğlu Fasarit Boya when considering production facilities, machinery fleet, number of employees, as well as data such as turnover and production volume?

We have production facilities in two separate locations: Kayabaşı and Hadımköy. At our Kayabaşı facility, we produce cement-based building chemicals. These consist of products such as external facade thermal insulation systems, ceramic adhesives, grout fillers, repair mortars, and water insulation systems. At our Hadımköy production facility, we produce entirely water-based interior and exterior facade paints, textured paints, ceiling paints, Fasarit, putties, and ready-made plasters. We have a total of 30 personnel including production and sales. Four of them are personnel working in R&D. In terms of production volume, we have a production capacity of approximately 20,000 tons per year at our paint facility and approximately 60,000 tons per year at our building chemicals facility.

What is the secret behind the success of Halimoğlu Fasarit Boya, which has been operating continuously for over 50 years?

In a country where 80% of enterprises do not survive 5 years and 96% do not reach 10 years, we have been continuously conducting production and sales activities for 53 years under the same family. This is a great source of pride for us. When I travel abroad, especially in Germany, I see companies founded in the 1500s and 1600s. Every time I go, I look at them with admiration. To be able to surpass half a century, to stay on our feet for long years is a great honor for us. It is the greatest indication that we are doing our job correctly. Because when I look at our customers, I see that we have relationships with many of them lasting 20-30 years. They have used our products, tested them, experienced our products. In many projects, more than 15-20 years have passed. For example, Aktürk İnşaat's Konutkent project in Ankara, 16-17 years have passed, and there is still no fading or peeling. For this reason, we become their preferred choice again, which is a huge advantage for us. Our company was also honored with the Golden Quality Award at the award ceremony held by TSE during World Consumer Protection Week in 2013. In our country, 8 companies from the paint sector were deemed worthy of this award. The biggest problem in the sector and in our country is disagreements between partners, fragmentation and divisions. Looking at many companies, fragmentation has occurred due to either family disputes or conflicts between partners. They have not established a professional management culture in their companies and emotions have often taken priority. However, despite some disadvantages of being a family company, we are a company that is very pleasant to work in thanks to the division of labor and rules established in our company. During certain periods, many crises are experienced on global and local scales. As businesses, of course we suffer losses during these crises. The 2001, 2004, and 2008 crises are examples of these. During crises, interest rates primarily rise, housing sales decline or stop. This causes serious sales and collection problems in the sector. Ersin has some advice: "If you know you will earn a million, if the person or company is not worth serving, you will know to push that money away with the back of your hand."

"If Halimoğlu faces a problem, they have a solution"

Therefore, we do not enter areas we consider risky. We periodically select our customers. We do not make very long-term sales. Because I think the biggest problem in the sector right now is credit terms. In a country where businesses have an operating life of 3.5-4 years, goods are sold with an average credit period of 8-10 months. This shows that 1 in 4 sales is risky. We do not engage in these, we try to provide service in areas we consider sound. Ersin has a saying: "I would prefer to be a small diamond rather than a large pane of glass." Based on this saying, we do not take any steps that we think would reduce our service quality. Our company is specially invited to construction sites by quite large projects. Among competing companies, there is a perception that "if Halimoğlu faces a problem, they have a solution" if they lack a product needed at the site. Creating this perception is truly very important... It is equally important to support this perception with quality, speed in service and delivery. We have a season of about 5-6 months. Most sales are concentrated in a 4-5 month period.

"We are currently a sustainable, manageable company that protects our workforce in the event of an unexpected crisis"

So yes, we have a capacity of 20,000 tons, but if you base it on the fact that 55-60% of this 20,000 ton production occurs within these 4 months, we need serious additional personnel capacity. Additional personnel means additional costs, and that cost becomes unsustainable. Additional capacity means additional sales needs, additional sales needs also brings various concessions in sales. So it is actually a vicious cycle. Yes, when you increase your tonnage, your unit costs decrease and your profitability may increase; but when you add a personnel burden that can meet that within this 4-5 month period, you are taking more risk. We are currently a sustainable, manageable company that protects our workforce in the event of an unexpected crisis. But with larger workforce sizes, very serious problems can occur in crisis environments. Therefore, we try to proceed more cautiously. Perhaps this is one of the underlying reasons why the activities we have maintained for many years continue uninterrupted. Because so many companies have come and gone. You look and they reach incredible tonnage in a very short time, you look again and in a crisis environment, because the process was not managed correctly, the unfortunate or unavoidable outcome occurs. Many sad customers, suppliers, wholesalers are left. Therefore, we try to move forward with more certain steps, saying that we should not sadden ourselves and that we should not sadden anyone else.

What kind of work do you do in the areas of innovation and R&D as Halimoğlu Fasarit Boya?

While developing our building chemicals products, we received support from Istanbul Technical University and Yıldız Technical University regarding product performance and had our tests conducted. Fasarit itself is an innovation. We have 27 cases involving unfair competition related to Fasarit. Competing companies attempted to produce products directly using the Fasarit name and still continue to do so. We are fighting these through the courts. Fasarit itself has given the sector a completely different direction, brought speed to construction, and the application method was developed by us. We received trademark registration in 1981. Our textured paints, putties, and ceiling plastic paint are also examples of innovation. A quality control chief at a very large construction company saw a picture in a magazine and wants the raw concrete-looking plaster he saw in the magazine on the walls of his new project and does not want to use ceramic. He sent us the image and we developed a completely new product that could achieve that pattern. It proved very successful, it will now be used in this 350-unit housing project. In other words, we can develop new products very quickly according to customer demands. Whether in terms of pattern or fill properties, we can develop solution-oriented products quickly. Every project may need a product that suits that surface, that climate, that geography, that craftsman, that team. We develop solutions suitable for that need. And we can do this very quickly; our European business partners are amazed that we can get results so quickly. Production experience is a very different thing; we have craftsmen, workers, and employees who have worked in production for 28-30 years. When a new product is to be developed, a suggestion comes from the engineering staff and also from the master craftsmen staff... You see that suggestions coming from the master craftsmen staff can often be oriented towards much faster and practical solutions. In this context, production experience is very important.

"We also produce products for our European business partners"

In 2001, after my master's education, I went to an international trade fair abroad for the first time. I saw insulation systems at the Munich Bau fair and when I returned to Turkey, I presented a report to the board of directors essentially saying "if we do not enter the insulation system sector, we will not be able to sell even a kilogram of external facade paint in the future, therefore we need to enter the insulation system very quickly." Of course, in the eyes of the family, I was the child from yesterday, someone whose feet did not touch the ground, a dreamer at first. I am not a chemical engineer, I do not come from a chemistry background, but I developed an incredible affinity for chemistry, especially after the end of 2001. I contacted foreign raw material suppliers regarding thermal insulation systems. We did not have a production facility at that time, so first I purchased vibrating screens and sets from England. I set up a fully equipped laboratory. During those years I am out doing sales during the day, working continuously on product development in the laboratory at night.

"As a result, we prepared samples of our fiber-reinforced plaster product and sent them to four different customers."

Later, an order for a truck came from one of them, without even asking about price. It was just after the earthquake at that time, all buildings had cracks and facade repairs were being done with mesh plaster. I told the customer we were not ready, and the customer said, "We really liked your product, we have a month's time, we want the product and we are ready to wait." We had the trademark registered under the name Thermo-Tec, had our packaging designs and printing prepared, and had our first production done as contract manufacturing. All products we produced were sold within a week. Meanwhile, the board of directors still was not convinced I could do it, that I could accomplish it... After three or four rounds of contract manufacturing like this, finally our board of directors was also convinced, asking what I needed and then providing tremendous support. In May 2002, we entered the thermal insulation sector with the Thermo-Tec thermal insulation system. Through this, a new window was opened for our company, which had only been producing paints until that day. From that day to this day, our thermal insulation system production and sales continue uninterrupted. Of course, being one of the first producers in the sector has some advantages in terms of recognition, product and production experience. Our products were used in very large projects. Currently, a company that wants to sell thermal insulation sector products without having a production facility comes to visit us first, asking how we can help. Around 8-10 companies in that situation have their thermal insulation adhesive, plaster, and decorative coating components produced by us. Besides this, we also provide production services to European companies for manufacturing they want to undertake in Turkey or shipments they will make to nearby geographies. We strengthen their hand logistically.

Can you tell us about your domestic and foreign sales activities? What types of products do you predominantly sell to which regions domestically and abroad?

With Ankara, İzmir, and Istanbul being our main centers, we have sales representative colleagues working from the Istanbul head office and home offices in Ankara and İzmir who conduct project tracking. These colleagues also conduct project tracking of regions in the near geography of their provinces. Our foreign sales activities are both in the form of direct exports and indirect foreign trade. Our products reach approximately 22-23 countries. The majority of this is indirect foreign trade. Our product was even used in Siberia, where the application was carried out at an external temperature of minus 40 degrees Celsius. Of course, in such special situations, we differentiate and modify our products. We customize according to expectations.

Could you provide information about Halimoğlu Fasarit Boya's environmental policy and sustainability approach? What kind of structure do you have in terms of production technology as Halimoğlu Fasarit Boya?

The raw materials we use in production, particularly for European companies, are of the highest quality in the field in terms of human and environmental health. We incur higher costs and use the least harmful materials for the health of our personnel and the people who will use our products. We particularly prefer raw materials with low VOC values. We use materials that are odorless and do not cause irritation through skin or respiratory exposure. At Kayabaşı, our building chemicals products are in the form of 25 kg kraft bags, and thousands of bags come off the line daily. Here, to prevent our workers from getting tired and to be able to ship better quality, better aligned products, we have a PLC automation-controlled production line. Formulas are fully entered into the PLC panel, the operator selects the code of the product he wants to produce, gives the instruction to the machine about how much needs to be produced, and after that production happens automatically and a robot system stacks our bags on the line. Therefore, we eliminate the negative effects on workers caused by thousands of bags being stacked by a single worker. We also ship better aligned pallets to our customer. We transitioned to this palletizing system in 2013. For perfect production to be achieved, production must be controllable, to be able to control, the matter must be taken out of the human factor. Therefore, only in this way can we present a flawless product to the customer. The programs and software we use in our production processes are designed to minimize human error. When an order comes from a customer, we enter the order into the software using the product code, and after the varieties and risk factors determined for the customer pass, the order drops to the production planning screen. Of course, procurement, sales, and delivery are all a chain of processes following one another. The batch numbers of the raw materials used in the product, which company it came from and on what date, all of this is traceable in our records. In this way, when there is a problem related to a product, we can trace the solution or determine where the problem originated. In this regard, all companies must incorporate technology, computers, and software systems into production if they are to survive long-term and minimize costs.

What criteria are given priority when Halimoğlu Fasarit Boya develops investment plans?

Does Halimoğlu Fasarit Boya have investment plans for the coming periods, and if so, what are they?

We operate in a sector where it is easy to enter production but difficult to ensure sustainability. Our people have an entrepreneurial spirit, an incredible desire and willingness to produce. Today you see even a subcontractor firm can enter production once it reaches a certain product consumption volume, saying I am going to use it anyway. But it also needs to be sustainable. For this reason, production becomes more attractive and rational only after reaching a certain sales capacity. We believe that investment must primarily provide added value to our customer and subsequently indirectly to us. In light of these considerations, our primary investment target is to consolidate the production we currently carry out at two separate locations under one integrated facility, thereby increasing our operational efficiency and consequently raising the level of our service quality even higher.