Shared Values, Shared Success
Distributors Have to Keep an Open Mind, on All Sides
Chemical distributor Brenntag has identified the potential of the specialty business that has become an increasingly significant factor for success as a strategic growth market in recent years. To take this growing significance into account, the Brenntag European Specialities Team, which is concentrating its activities on expanding Pan-European specialty business, has been operative since January 2008. Brenntag supplies a wide range of products specialized for the ACES markets - adhesives, coatings, elastomers, sealants. Michael Reubold spoke with Martin Rimmer, European Business Development Manager ACES.
CHEManager Europe: Mr. Rimmer, Brenntag regards specialty chemicals as being future-oriented products, requiring a great deal of informative work. Which role does the ACES business line play in this strategy?
M. Rimmer: Brenntag Specialties Europe is a Sales and Marketing organisation. In ACES we are focussed on the coatings, adhesives and construction chemicals industries. These are subdivided into different sectors but are always determined by our customers' industry. We concentrate on understanding the challenges and problems that our customers have, we can then introduce solutions. These are based on both proven and innovative technologies from several of the world's leading chemical companies and many more medium and small sized producers for whom we provide the best access to a very large customer base.
Although your business is highly diversified, a significant part of your sales markets are affected by the global economic crisis. What consequences do you expect for your sales activities for the remainder of 2009?
M. Rimmer: It is no surprise that our business has been affected by the economic downturn which we face since the second half of 2008. Our customer base is composed mostly of SMEs, small and medium sized enterprises. Of course we face lower consumer demand and the credit squeeze has taken a toll.
The consequence for our sales activity is clear: We get out and listen to our customers even more frequently than ever. We are responding to the need to reformulate and upgrade product performance and to the demand for products which meet tougher regulations, and indeed to consumer demand that we all take greater care for the environment. This is as true for coatings as it is for adhesives and construction chemicals.
Eventually, demand in all markets will pick up again. From what sectors do you expect rising demand first?
M. Rimmer: Everyone is already looking for those famous green shoots! Our most innovative and responsive ACES customers in Europe will be the ones to watch. I say responsive because often small companies can react quicker to changing conditions and get a head start. One would expect that as the money supply is increased construction will restart, lead by publicly funded projects and followed by private development initiatives. Coatings has a perpetual baseline through refurbishment in the architectural sector and as newly build properties are finished off that sector will pick up too. Inks will be interesting to follow as it is so closely related to consumer spending, as are a significant proportion of adhesives for packaging and so on. Eventually as consumer confidence grows all those applications in heavier manufacturing industries should follow, as long as Europe has been able to preserve the skills and assets.
The recession does lead to restructuring in the chemical industry but also in many industries where chemicals are used. Thus, distributors will face a changing business environment. Do you expect significant shifts in your supplier and customer relationships?
M. Rimmer: I'm showing my age here, the chemical industry has been restructuring since well before I graduated in Chemistry in 1984 and started work and it will continue to do so. Like all other industries we at Brenntag ACES Europe must be responsive to our customer demands and the demands of our other stakeholders How often have we heard the phrase, "the only constant IS change?"
How do you manage changing supplier and customer relationships?
M. Rimmer: Brenntag Specialties Europe has a rich and diverse portfolio of suppliers. Consolidation is a fact of life and we deal with each situation as it arises. It is essential to have a healthy and open dialogue and keep an open mind, on all sides. Distribution is not the horse trading of old, it's a rapidly modernising and dynamic industry, and we are not the Brenntag of 20 years ago... Old perceptions, myths and prejudices take a long time to die. For Brenntag Specialties Europe, in each clearly defined territory, we work with only one supplier for any specific technology and product line. We understand the needs of specialty chemical producers and we market their products according to the way they do themselves.
Our customer base is very broad indeed, we operate in almost every European country and we have a dedicated sales force for the ACES businesses. Brenntag has the most extensive and interactive customer coverage of any chemical distributor. Our aim is always to invest in customer relationships in order to grow with them. This will not change, we will grow by providing the products and services they need, from recommending a product to solve a technical issue, working together on new formulations, through to providing up to date advice on Health and Safety, REACH compliance and wider aspects of market trends and drivers that could affect our customers.
Specialty chemicals distribution requires technical expertise of products and applications, and customers expect value-added services from their suppliers. What elements of added value creation do you offer to your customers?
M. Rimmer: Brenntag Specialties has a consistent record of growth in Europe and indeed the world, it is now the largest specialty chemical distribution business in Europe. We have a well trained technical sales force supported by product management expertise and customer support teams. Our sales groups have a mix of chemists and people from the industries we serve, paint and adhesive technicians, sealant formulators and building chemical experts. We talk the language of our customers and more importantly we listen to them. We provide technical service advice, formulation advice and guidance on regulatory matters such as REACH. Brenntag provides mixing and blending services to many types of customer and of course tailored logistics solutions for inventory management, which naturally benefit our suppliers too. We search out new and innovative products and with many key suppliers; we actively participate in product development programmes.
How do you work with your suppliers to complement your portfolio, and how do you assist your customers in finding or developing optimum solutions for their problems?
M. Rimmer: I have to go right back to the beginning again and say, Brenntag Specialties is a Sales and Marketing organisation and our ACES business is core to that ideal. It's simply what we do. Selling, when defined in modern terms is the management of customer relationships to secure today's orders. Marketing is the understanding of customer needs and marshalling the required resources to secure tomorrow's profits. When we listen carefully to our customers, understand what they need and work closely with our suppliers to provide the solutions, because we share the same values, we will share success in the future