CHEManager: Mr Mucha, for context, please briefly explain the structure of ESIM and its positioning in the market..

Bernd Mucha: ESIM Chemicals today is made up of the two independently operating business units ‘Intermediates’ and ‘Exclusive Synthesis’. Due to its heritage, ESIM has extensive experience in the field of specialty chemicals and many years of expertise as a Custom Manufacturing organisation with the Exclusive Synthesis business unit, in short ES.

A clear and autonomous definition of the business orientation was created through ‘downsizing’ from a production site of the DSM corporation to a medium-sized company with a turnover of around 200 million EUR and around 500 employees. Both the business understanding and the corresponding structures have been adapted and realigned to best serve our focus markets.

Of course, the establishment of ESIM as an independent brand in the market took some time, especially since other companies (primarily spin-offs from large European specialty chemicals companies) had already been operating in the Custom Manufacturing market for almost two decades.

How was the business unit still able to establish itself in the competitive market segment?

B. Mucha: The ES business unit undertook an even more precise alignment in the field of Custom Manufacturing to be able to offer a wide, future-oriented product range to interested customers in various markets. Existing technologies and synthesis methods also enabled us to realise projects in markets that are still new to us. Additional investments were made in many respects to optimally meet the changing demands of various markets. In addition to investments in infrastructure improvement measures such as environmental protection, automation and digitalisation, investments in new systems and technologies to expand the ES product portfolio are of particularly high importance.

“Personal contact will not lose its special, empathetic touch.”

 

How has your new owner supported you in this?

B. Mucha: With regard to some rather high investment sums, our investor, Sun European Partners, has played a decisive role since 2018. Sun has supported the strategic growth of ESIM from the very first minute, and the owner is also prepared to take further steps here together with the management.

Just recently, ES successfully commissioned a new plant for the innovative product of an agrochemical customer. This project impressively reflects our investor’s willingness to invest in profitable, new projects.

Exclusive Synthesis is a customer business, where the organisational structure of a company or business unit also plays a decisive role in market success. How are you organisationally structured?

B. Mucha: In order to operate even more effectively on the Custom Manufacturing project market, the ES business unit introduced a new organisation with a focus on efficient project management processes in the middle of last year. The clear focus here is on evaluating customer enquiries as quickly as possible and providing an initial cost estimate and subsequently a detailed quotation in the usual high technical quality. The increase in quotation processing speed has already been proven many times over the past few months since the introduction of this process.

The redesigned project management system is also intended to sort out projects with a less positive ‘fit’ in terms of the more efficient use of resources quicker than before. Performance is now measured early along our Prospect-to-Acceptance process. The management introduced corresponding key performance indicators for continuous performance assessment. We thereby noticed a clear increase in the processing speed for various projects over the past few months – a great success in a short period of time.

Our customers and partners value our quick feedback and they can now find out whether their requested project can be a ‘fit’ from both a technological and an economic point of view even earlier. With regard to the training and further education of our employees, we also increasingly rely on sound project management skills.

Where do you see your core technological competence and how do you highlight this to your customers?

B. Mucha: The core competence of the Exclusive Synthesis business unit focuses on the manufacture of chemical products for agrochemical, food & feed, personal care and other chemical industries and the continuous improvement of production processes. We want to be more present on the market in many areas over the coming months. In this respect, we would primarily like to highlight our competences and know-how for manufacturing technically advanced, chemical products, which are often intermediates for further processing into valuable chemical end products, even more clearly than before. In order to significantly expand our presence in these target markets, we are opening a new project office in addition to our head office in Linz, Austria.

Why did you choose Frankfurt am Main as a location, and why now, when travelling is rather difficult and being replaced by online meetings due to the pandemic?

B. Mucha: We chose a central geographical location from which many of our cooperation partners and potential new customers are easy to reach as the location for our newly opened project office in Germany. Frankfurt am Main proved perfect with its extremely good transport links to important regional and international locations in the chemical industry.

Indeed, contact by means of digital media increased sharply in times of a pandemic, but personal contact will not lose its special, empathetic touch. We do not see competition between personal contact and digital communication, but we consider both modes of communication as complementary to each other.

What expectations (also with a view to possible growth) connect you to the new location?

B. Mucha: The project management teams in Linz and Frankfurt are together taking a stand in the market for Custom Manufacturing projects and looking forward to new intensive project developments, both with our long-term partnerships and new customers.

We have acquired an experienced chemical manager with Jochen Dittombée as Team Lead und Key Account Director for our new office, who has a wealth of market experience in both Custom Manufacturing business and related areas. A total of three project managers will initially form the Frankfurt office team.

The customer accounts will be redistributed between the two teams, but with a sense of proportion and without disturbing existing relationships. The Frankfurt office will essentially focus more on new customer acquisition and make a disproportionate contribution to more intensive market penetration in the field of ES. However, we will avoid creating barriers between the two teams at all costs. That is already demonstrated by the fact that the reciprocal mixing of both teams is very much desired and also promoted by senior management. We assume that the Frankfurt office can generate additional project business of up to approximately 10 % turnover per annum in the next two years

Does the current market environment promote your growth plans? How do you assess the medium and long-term business prospects in Custom Manufacturing, especially in the segments served by ESIM?

B. Mucha: Especially in times of a pandemic, we experienced the collapse of previously efficient and hitherto stable supply chains in many industries – even we at ESIM were part of this phenomenon. However, the disruption of the movement of goods between continents can also be triggered by relatively minor events – I am thinking in particular of the effects of the recent shipping accident in the Suez Canal. These phenomena ensure that regional European chemical production gains more importance again. Even within the chemical industry, we are monitoring a shift in opinion and we are preparing for this with the corresponding investments already mentioned. Challenging chemical syntheses, e.g. in agrochemistry, create an increased demand for competent synthesis and production partners, even during times like these.

PROFILE

Bernd Mucha joined the management of ESIM Chemicals, Linz, Austria on 01 July 2020 and took over the leadership of the Exclusive Synthesis business unit. Mucha studied Chemistry at the University of Hannover and started his career at Hoechst in Frankfurt in 1988. Having held various international management positions, he was most recently the Managing Director of Allessa Chemie, a WeylChem Group company. He is now supporting the team around CEO Frank Wegener with the strategic realignment of ESIM.