Globalization and digitalization and the increasing requirements of their customers and their principals pose a variety of challenges on chemical distributors. Constant innovation seems to be the only means to face these challenges. The European Association of Chemical Distributors, FECC, has chosen the theme “Inspiring Innovation in a Global Economy” for their Annual Congress 2016, to be held in Istanbul in early June. Innovation in chemical distribution — as in other sectors — can be manifold and include products and technologies, customer relationship and business models, staffing or IT infrastructure. We wanted to know from spokespersons of leading chemical distribution companies what innovation means in and for their enterprise and what measures they take to inspire and implement innovative ideas. The answers may reflect different strategies, but one thing holds good for all: do not lose any time. Or as one of the interviewees put it: “innovation has to be done while you are healthy; once you really need to change it may be too late.”

‘Translating Market Needs into Innovative Formulations’

Hans-Joachim Müller, CEO, Azelis

“At Azelis, our business philosophy is centered around technical services. Local and market-dedicated sales managers who combine technical expertise with business know-how drive our business. These experienced sales managers know every aspect of the different elements of the products and service portfolio Azelis represents and effectively trigger innovation as they can quickly leverage the knowledge gained through our own labs and maximize the synergistic effects of the building blocks of the lateral value chain. This key strength — translating market needs into innovative formulations — is further enhanced by the strong relationships we have with product development teams, regulatory affairs and buyers. This can open up many new applications for our principals’ raw materials.

Knowledge-sharing is another important innovation at Azelis. Our sales and technical teams regularly organize seminars, workshops and training days in our application labs for customers, jointly with suppliers. Our specialists are constantly researching trends, identifying innovative new products and enabling our customers to anticipate market expectations.”

Vitality Requires Quick Thinking and Adaptation

Thomas Arnold, CEO, Biesterfeld

“At Biesterfeld, innovation and continuous change are not only desirable, but also crucial for our long-term vitality. Whether it concerns adjusting our business model, undertaking regional expansion, or developing a range of customer-orientated solutions, being able to think and adapt quickly is becoming ever more important. We are constantly working to enhance our business processes and service offer and to increase the added value for our customers and distributors.

One illustrative example is to offer our customers an extensive product portfolio, while continuing to develop consultancy services in areas like laboratory support, product formulation and beyond. In the age of digitalization and Industry 4.0, the innovation activities of the future will be increasingly guided by technology. Even now, this is already having an impact on our investments. There are two essential topics in this regard: transparent processes when dealing with partners, and knowledge management.

Steady further development can only succeed in an innovative corporate culture where there is openness to change and an ability to adjust to the ever-greater pace.”

Market-Tailored Solutions for Megatrends

Frank Haug, CEO, Bodo Möller Chemie Group

“Bodo Möller Chemie closely monitors megatrends and the demands thereby placed on various markets with regard to the development of viable future innovations. We attach the utmost importance to the application technologies and end products of each and every customer. We have long‑standing partnerships in place with innovation‑focused, technology‑driven companies in particular in the automotive, aerospace and railway industries.

In addition to our mastery of process technologies, we possess a thorough understanding of end‑product requirements and the markets in which our customers operate. This allows us to incorporate our capabilities and experience into current developments in a targeted manner, which benefits our entire customer base. Due to our industry‑specific certifications and our application technology services, including individual application testing in our laboratories, needs‑based repackaging services, and customized product formulations in our Polymer System House business unit, we are in an ideal position to provide market‑tailored solutions accessible to our customers throughout the entire development stage — for competitive products and promising new processes.”

Dedicated to Customers with an Ear on the Markets

Karsten Beckmann, member of the Board of Management of Brenntag Group and CEO Brenntag Europe, Middle East and Africa

“Innovation is an integral part of Brenntag’s business model and a key growth driver. Particularly in mature markets, companies need to focus on innovation in order to stay profitable and competitive. Thanks to our well-trained and skilled sales and marketing team we have an ear on the markets and are able to react promptly to or even anticipate trends and developments.

Brenntag stands for a dedicated customer- and industry-focused approach. By offering value-added services, Brenntag is a product development partner for its customers, e.g., in specialty chemicals. We are supporting our customers’ product introductions simultaneously, being part of the development process and providing application know-how, technical and marketing expertise. Our people enjoy developing tailor-made solutions and sharing success with our partners. Innovation at Brenntag means being and remaining flexible and future-oriented, responding to ever-changing market environments and requirements quickly and reliably.”

From New Business Models to New Products

Robert Späth, CEO, CSC Jäklechemie

“Why innovate? Because it is the best choice to achieve a competitive advantage in a constantly changing environment. The challenge is to scout the relevant trends that affect your business and find the right answers.

For CSC Jäklechemie, innovation means actually building the infrastructure to face the digitalization and the Industry 4.0 trend, which some call disruptive. At the same time, we introduce new business models to the market, such as chemical leasing, to manage the rising legislative pressure to control the supply chain. Finally we develop new products with added values to enable our customers to stay competitive. All this implies motivated teams with the ability to network and handle complexity.”

Collaborating To Generate Profit

Natale Capri, co-head business unit performance material, DKSH

“To meet the needs of our customers and clients, DKSH operates 26 innovation centers worldwide. From these laboratories, we develop cutting-edge products and formulate winning solutions enabling our partners to innovate for growth.

Our experts harness their deep industry expertise and innovation capabilities to generate, develop and customize product ideas, find new ingredients and technology applications, provide hands-on training and run acceptance tests to cut time-to-market for our business partners’ products. We work in close collaboration with our business partners to learn and grow together, ultimately generating solutions that are profitable for all parties.

Innovation is paramount to DKSH’s success as a leading market expansion services provider in the chemical distribution industry.”

Our Services Are Our Product

Christopher Erbslöh, managing director, C.H. Erbslöh

“Innovation outside the product-innovations, offered by our suppliers and partners, has become increasingly important in the competitive landscape of the chemical distribution industry. As a chemical distributor it is important to understand the services performed as the product we offer to the market and to constantly find innovative ways to improve these. This mindset has helped us to develop innovative solutions for our partners that address the continued demand for reducing complexity and costs in the supply chain. Understanding the different value chains of the individual products and end-user markets is the key to success in service innovation as there is no one-size-fits-all solution in the chemical industry. This approach of concentration, customization and innovation has been the backbone of 140 years of success for C.H. Erbslöh, and today, more than ever, appears to be vital in staying competitive and finding the answers to tomorrow’s challenges.”  

Embrace New Technologies

Claus H. Nielutz, managing director, Harke PackServ

Harke Group has taken a step forward with its integrated sales strategy. Not only offering competitive raw materials, but also matching, innovative packaging for solid and liquid applications, brought together at our in-house packaging facility, Harke PackServ. As part of our product range, we are representing specialty films from our partners Aicello and Ikonics. As a first step to promote the sales of films, we have started selling production equipment, i.e., for sandblasting. As a second step, we have worked on increasing customer competence and thereby increasing demand/sales, offering training sessions in our Harke Imaging academy. Today, Harke PackServ is offering far more than films but instead complete systems including machinery, devices, seminars and also contract packing and production services.

This innovative customer approach, as part of an evolutionary process, proved to be very successful. We have been able to generate new business with premium industrial customers and high-end design companies. Using social media as a multiplication platform has created an additional sales channel — free of charge. To sum it up: It was important to embrace new technologies and adapt to changing customer behavior.”

Experience Accumulated Across the Globe

Hans-Christian Sievers, chairman, Helm

“Helm has always proceeded along paths of its own during its 115-year corporate history. To us it was important from the outset to focus as closely as possible on the needs of our suppliers and customers. For instance, Helm already established its first sales offices abroad in the 1960s; that certainly was innovative at a time when the term globalization had not even been coined.

Our IT solutions today ensure that the experience accumulated across the globe by our staff members can also be shared across the globe with our colleagues; in other words, the information flow proceeds in all directions and back again. Two of our business units, namely crop protection and pharma, have basically been designed and created to be innovative: scientists, project and product managers work hand in hand in both business units in order to develop innovative products and individualized business models. In our fertilizer and chemicals business units, we score in particular thanks to logistics solutions and marketing concepts that did not have their origins in a test tube.”

Market-Focused Technical Experts

Frank Schneider, managing director, IMCD Deutschland

“Specialty chemicals are used in countless products that form an important part of our daily lives. The constant demand for product improvement and performance enhancement drives the requirement for innovative specialty chemicals. Innovation is therefore at the core of IMCD’s activities. By partnering with leading suppliers, IMCD has access to a comprehensive range of innovative raw materials and first-class products. Utilizing this portfolio, the company’s market-focused technical experts proactively offer customers tailored and unique solutions to overcome their formulation challenges.

IMCD also operates 26 laboratories across EMEA, Asia-Pacific and the Americas. These laboratories allow us to analyze and engage with the very latest market trends, working in close collaboration with its customers’ research and development departments to carry out competitive matching, share new application opportunities and assist them in formulating the most effective, innovative and sustainable products for the demanding markets in which they operate.”

Staying Close And Flexible

Dr. Holger Franke, head of Technical Department, Klaus F. Meyer

“The European chemical industry has shown a very high innovative capacity for many generations. Generally, innovations are existentially important for distributors in order to circumvent the competitors in a rapidly growing competitive environment. Innovation is the key toward growth as well as higher profitability.

As a globally acting company, Klaus F. Meyer tries to provide its customers with innovative and sustainable raw materials. Continuous presence at the customers as well as presence at international trade fairs helps us to detect market trends at an early stage and to react very flexibly on these market trends.

As distributor we always keep close contact to our customers within the scope of customer relationship to participate in developments in an early stage. Here we do not only act as a trading company but also as an agent between our customer and the manufacturer. In this triplet we see the best way to offer our customers innovative and sustainable products.”

Advantages of a Diverse Network

Dr. Bernd Soyke, managing director, Penta Chemikalien

“Penta, as the biggest cooperation in chemical trade, defines itself particularly as a service provider for its shareholders, customers and suppliers. This company, unique for Europe, depends very much on the confidence of our partners. Changes and renewals require a sensitive handling. Due to our diverse network with very different market players and the relevant training of our employees we are able to identify opportunities arising on the market. From this follows the early initiation of innovations, preferably together with our colleagues from our shareholding companies. It is important to us to involve the people in all changes and convince them of the advantages. Only in the common dialogue a realization can be successful.”

To Inspire is the True Supreme Discipline

Oliver Zimmermann, CEO, TER Chemicals Distribution Group

“’To the future of our company!’ were the words I chose while toasting our Hamburg team on Jan. 5, 2015. It marked the start of our company’s new distribution structure. The move toward a matrix organization was central to our further European expansion and collaboration. Now we aim to redefine our digital landscape and to continuously develop our application know-how. We were doing well beforehand, but we think we could always be doing better. That is indeed one of the most challenging aspects of innovation — it has to be done while you are healthy; once you really need to change it may be too late.

While being innovative is one of the most demanding tasks of management, the most critical is to transfer this ideology to the employees and to create an environment where people can do their best work. After all, what is the point of innovation if it remains a concept on the drawing board? While innovation is key, being able to inspire is the true supreme discipline.”