An organization’s success often hinges on its ability to use its proprietary knowledge to gain a competitive advantage over other companies. A manufacturing enterprise would value its production process and techniques very highly. Similarly, a firm engaged in trading activity would place great importance on its client list and the names of its prospective customers.
Firms in the chemical industry have not been as aggressive as those in some other sectors in adopting digital technologies. This has happened despite the fact that senior executives at many of these companies are aware of the range of benefits that digitization can offer in improving their chemical suppy chain.
The global chemical industry is undergoing rapid change. Both demand and consumption of chemicals are shifting eastwards as new manufacturing facilities come up and China’s consumption levels rapidly increase. New production capacities are being developed in the Middle East and in other non-traditional areas.
Chemical buyers can find it difficult to gather up-to-date and relevant information about their industry. Which suppliers offer the lowest prices? What are the precautions to be taken if you are sourcing raw materials from overseas sellers in China? Will spot prices for a certain chemical fall in the near future?
Purchasing departments that handle the procurement of chemicals often face customer service issues. The level of difficulty in resolving a problem that chemical buyers experience is usually inversely proportional to the size of the buying organization. Large companies demand and receive a high level of service. Suppliers go out of their way to ensure that bulk buyers do not find any reason to complain about their services. If something does go wrong, they immediately take up the issue and initiate corrective action.
Buying raw materials from overseas suppliers holds many attractions for chemical consumers. The primary benefit, of course, is a lower price. If a company in Europe or the US can establish a low-cost supply chain that sources materials from China or the Middle East, it can gain a tremendous competitive advantage.
To Kemgo’s many faithful members and followers, by now you’ve probably started to witness the power of the network, especially the online network. Even with our successes in helping many of you find better deals in 2016, there is still so much for us to do to help make the work that you do easier, more beneficial and, at the end of the day, fun. Because, that’s what life is all about, isn’t it?
Topics: Kemgo News and Highlights
Chemical companies that enhance their digital B2B capabilities will be in a better position to adapt to a changing competitive landscape. They can take advantage of several important opportunities, including deeper and stronger customer relationships, streamlining lead qualifications, and extending company reach.
Technology and business practices are evolving and the shifting expectations of customers are quickly raising the bar for most suppliers. e-Commerce interactions in the chemical industry will need to be more customer-focused and richer. In the near future, all B2B processes will be digitized. That is a shift that will enable sellers to more effectively and proactively improve their marketing efforts and customer reach.
You may have heard the term: “Never change a running system (or machine)." If you are German or have lived in Germany for quite some time I would be quite surprised if you have never come across it. This term is in fact a German pseudo-Anglicism. It comes from the expression: “Never change a winning team.” That has a different relevance after all.
You might remember the quotes I mentioned about Zetschke, Darwin and that managing partner from a large consulting firm in Part 2 of this series blog: Change is an integral part of our lives and it is needed to stay competitive. It is needed to survive.