Digitalization is a very important topic not only in the chemical industry as a whole, but also in chemical distribution. As Wolfgang Falter states in his article: Customers increasingly search online and initiate digital contacts via websites, social networks, search engines and commercial platforms. Those distributors that they do not find online are no longer present in the relevant markets.

This development has led to many discussions within the chemical distribution industry on how best to address the issue of digitalization.

CHEManager asked executives and industry experts familiar with the development of e-commerce in chemical distribution to share their opinion on what needs to be done in order to survive in an increasingly competitive environment and how to deal with a possible disruption caused by new digital developments. We wanted to know:

Who in the chemical supply chain from principal to distributor, logistics provider, online retailer, start-up to customer will be winners/losers in online distribution?

Steve Holland: Digitalization provides a significant opportunity to increase transactional efficiency and many integrated functions which enhance customer experience and create in­stantly accessible information in real time along with multiple application and points of reference from safety data through to formulation and practical help.

Today there are manufacturers who are developing digital solutions for their own products and services. The complexity to do this effectively in their current supply chain capability versus the use of existing distributor models is unlikely to drive a significant return as smaller consumers can present an even larger demand on logistic resources. There are some smaller providers who are promoting digital marketplaces. Many of these are offering a consolidation platform on an “arm’s length” basis without any obvious control or any investment in the supply chain. Control and investment in the supply chain underpins many of the essential aspects such as safety, traceability and security required to distribute chemicals and ingredients, many of which may be categorized as hazardous and have high regulatory controls.

"Creating the Most
Convincing Customer Experience"
Steve Holland, CEO, Brenntag

Digitalization provides only one of several channels for customers to interact with suppliers and distributors in combination with other services such as technical support, formulations, mixing and blending which create further value added and require a personal customer contact. The winner in the race to digitalization will be the channel who creates the most convincing customer experience, and we at Brenntag have all the means to succeed.