The Sherwin Williams's Business Segments

The Sherwin-Williams Company, founded in 1866 and incorporated in Ohio in 1884, is engaged in the manufacture, distribution and sale of coatings and related products to professional, industrial, commercial and retail customers primarily in North and South America.

Paint Stores Segment

The Paint Stores Segment consists of 2,688 company-operated specialty paint stores in the United States, Canada, Virgin Islands, Puerto Rico and Mexico. Each division and business unit of the Segment is engaged in the related business activity of selling our own manufactured paints, coatings and related products to end-use customers. During 2003, this Segment opened'45 net new stores, remodeled' 14 and relocated'29. The net new stores consisted of 41'stores in the United States, 3'in Canada and 1'in Mexico. In 2002, there were'70 net new stores opened or acquired (62'in the United States). In 2001, 85'net new stores were opened or acquired (83'in the United States). This Segment also manufactures original equipment manufacturer (OEM)'product finishes sold through certain shared or dedicated paint stores and by direct outside sales representatives. In addition to stores, operations in Mexico include outside selling functions to dealers and other distributors.

The Paint Stores Segment is the exclusive North American marketer and seller of Sherwin-Williams' branded architectural paints and coatings, industrial and marine products, OEM product finishes and related items produced by its product finishes manufacturing facilities and by the Consumer Segment, including the Consumer Segment's Mexico manufacturing facility. The loss of any single customer would not have a material adverse effect on the business of this Segment.

''Paint Stores Segment: Sherwin-Williams', ProMar', SuperPaint', A-100', PrepRite', Classic 99', Duration', Master Hide', Sher-Wood' and Powdura'.

Consumer Segment

The Consumer Segment develops, manufactures and distributes a variety of paints, coatings and related products to third party customers and the Paint Stores Segment. Sales and marketing of certain control-branded and private labeled products is performed by a direct sales staff. The products distributed through third party customers are intended for resale to the ultimate end-user of the product. The Consumer Segment has sales to certain customers that, individually, may be a significant portion of the sales of the Segment. However, the loss of any single customer would not have a material adverse effect on the overall profitability of the Segment. This Segment incurs most of the Company's capital expenditures related to ongoing environmental compliance measures.

''Consumer Segment: Thompson's', Dutch Boy', Martin Senour', Cuprinol', Pratt & Lambert', H&C', Rubberset', Dupli-Color', Minwax', White Lightning', Krylon', Formby's' and Red Devil'.

Automotive Finishes Segment

The Automotive Finishes Segment develops, manufactures and distributes a variety of motor vehicle finish, refinish and touch-up products primarily throughout North and South America, the Caribbean Islands and Europe. This Segment also licenses certain technology and trade names worldwide. Sherwin-Williams' branded automotive finish and refinish products are distributed throughout North America primarily through this Segment's network of 142'company-operated automotive branches in the United States and 16 in Canada. Additional automotive branches in Jamaica (15), Chile (20) and Peru (1) complete this Segment's worldwide network.

''Automotive Finishes Segment: Sherwin-Williams', Martin Senour', WesternTM, Lazzuril', Excelo', Baco' and ScottWarren'.

International Coatings Segment

The International Coatings Segment develops, licenses, manufactures and distributes a variety of paints, coatings and related products worldwide. The majority of the sales from licensees and subsidiaries occur in South America, the Segment's most important international market. This Segment sells its products through 28'company-operated specialty paint stores in Chile, 27'in Brazil, 5'in Uruguay and 1'in Argentina and by outside selling functions to dealers and other distributors.

''International Coatings Segment: Sherwin-Williams', Dutch Boy', Krylon', Kem-Tone', Pratt & Lambert', Minwax', Ronseal', Colorgin', Globo', Pulverlack', Sumare', Andina', Marson' and Martin Senour'.

Administrative Segment

The Administrative Segment includes the administrative expenses of our corporate headquarters site. This Segment includes interest expense which is unrelated to retail real estate leasing activities, investment income, certain foreign currency transaction losses related to dollar-denominated debt and foreign currency option and forward contracts, certain expenses related to closed facilities and environmental-related matters, and other expenses which are not directly associated with any Operating Segment. Administrative expenses do not include any significant foreign operations. Also included in the Administrative Segment is a real estate management unit that is responsible for the ownership, management and leasing of non-retail properties held primarily for our use, including our headquarters site, and disposal of idle facilities. Sales of the Administrative Segment represent external leasing revenue of excess headquarters space or leasing of facilities no longer used by us in our operations. Gains and losses from the sale of property are not a significant operating factor in determining the performance of this Segment.