Employees of Santa Ana-based Behr Paint Co. trickled inside the company’s cafeteria Tuesday afternoon this month for a colleague’s retirement party, but the festivities looked like they were taking place at a trendy restaurant with the lunchroom’s wood-paneled bar and colorfully upholstered booths.
Behr’s cafeteria is just a small piece of a larger renovation for its new 230,000-square-foot headquarters, completed earlier this year by Newport Beach interior architecture and planning firm H. Hendy Associates.
Behr President Jeff Filley said its new digs were long overdue as employees were previously spread across four buildings, each offering few amenities and a shortage of parking.
It was able to consolidate 650 employees into its new headquarters, but employs more than 1,000 in the area at nearby facilities. It’s one of Santa Ana’s largest employers.
“We were pretty successful recruiting people to Behr and retaining people even with our old building with no windows,” Filley said. “This new location—it’s a bit more of a showcase as potential recruits come and visit. Unemployment rates are so low today, it’s certainly more difficult to find people and a lot of our people are being looked at … so we’ve got to stand out above the others.”
Inside, visitors and employees are greeted with a Behr-branded, 1941 Ford Woody station wagon on loan from former owner and longtime Newport Beach resident Jack Croul. The car is a nod to Behr’s founder Otho Behr, who started the company in 1947 after selling redwood stain products from the trunk of his Woody wagon.
The rest of the décor pays tribute to Behr’s Southern California roots.
There’s a carpeted “highway” cutting through the office with department signage made to look like street signs, as well as several seating areas, multiple cafés and a coffee bar, outdoor barbecue, a gym and yoga studio with classes taught by a Behr employee.
It also built out a 28,500-square-foot research and development center for its 116-person team, not counting the 127 chemists it employs in India.
Filley said 184 different colors were used throughout the space, as well as images of oceans and redwood forests.
“We wanted to develop a space that had a lot of energy and some emotion, creativity and innovation,” he said.
United Front
Behr inked its lease on Saint Andrew Place—in an office park just west of the Costa Mesa (55) Freeway—two years ago, in one of the largest office deals in OC the past few years. The paint and stain maker took over the home of defunct telecom equipment maker Powerwave Technologies.
Filley said its building gives the firm room to grow—several sections of empty desks were already set up throughout the office during a tour this month—but the move was really spurred by a need to consolidate its staff into one building and streamline collaboration between departments.
Behr still has multiple facilities in Santa Ana, including a nearly 300,000-square-foot distribution center on South Standard Avenue, an application lab and color lab on Segerstrom Avenue and another three manufacturing plants in Santa Ana.
It’s one of the largest suppliers of architectural paint and exterior wood care in the country, thanks to an exclusive partnership with retail giant The Home Depot Inc. (NYSE: HD), which means its products are sold in more than 2,200 Home Depot stores in the U.S., as well as Canada and Mexico.
Behr and its affiliated companies counted about $2 billion in sales last year, according to regulatory filings. Sales in its business unit were up about 20% last year, thanks in part to “selling price increases of paints and other coating products and increased sales volume of builders’ hardware and paints and other coating products,” according to its parent company, Masco Corp. (NYSE: MAS).
Behr was sold to Taylor, Mich.-based Masco in 1999, when it was estimated to do about $350 million in sales annually. Masco owns a number of home improvement brands such as Delta Faucet Co. and has a market cap of about $12 billion.
Partnering with Home Depot on such a large scale does count some risks.
Any fluctuations in the paint category for Home Depot would also have an adverse effect on not only Behr’s business, but for its parent company, according to Masco’s latest annual report.
It said sales of its “architectural coatings,” or Behr and its affiliated brands, accounted for 24% of its 2018 net sales and losses in the segment due to Home Depot “would have a material adverse effect.”
Masco’s second largest customer Lowe’s accounted for less than 10% of company sales.
Filley said Home Depot has been a good partner, adding that Behr was one of the first suppliers when the retailer opened in 1978.
“We were shipping product from our small plant here in Santa Ana cross-country to those first three or four Home Depot stores,” he said.
Home Depot Executive Vice President of Merchandising Ted Decker recently cited Behr as one of its two paint and stain brands that “helped drive paint comps above the company average” in the fourth quarter.
Branching Out
But Filley said it has looked to diversify its partnerships for its other brands based in Santa Ana such as Kilz, often used by professional contractors, and available at stores including Ace Hardware, True Value and Walmart.
It also inked its first licensing deal under the Kilz label with Magnolia Home, the lifestyle brand launched by famed home improvement guru Joanna Gaines. Last month, it launched Magnolia’s exterior paint collection comprised of 150 colors.
Global Chief Marketing Officer Jodi Allen said it is one piece of the brand’s effort to meet the needs of its customers, who are often looking to social media and online to find color inspiration.
“We know about 80% of consumers researching for paint are going online prior to going in [the] store,” Allen said.
That statistic drove Behr to redesign its website and make it easier for customers to shop for paint online. It also created a tool for customers to get up to six customized color suggestions based on their Pinterest boards.
“We’re excited about being able to help consumers through this paint journey [and] provide them with inspiration as well,” she said.
Last week, it also announced a search for its first-ever “color explorer.”
The lucky candidate will receive a $10,000 stipend and pre-paid travel expenses to be inspired by nature to create and name new Behr paint colors. The job posting garnered national attention.
“Just as much as we want our consumers to connect with Behr, we also want our brand to connect with consumers and the Behr Color Explorer initiative does this,” Allen said. “We’re not only giving the individual the tools and resources to find, experience and cultivate color, but also showing them how to creatively think about each color they find and their stories from our brand’s perspective.”
