Chemical consumers face the challenge of identifying suppliers who can deliver raw materials of the required quality at a fair price. Once they have found a reliable vendor, buyers have a tendency to continue the association even if there is a possibility of finding alternative sources that are more economical.

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Why should the purchasing department of a company do this? There are many benefits to finding new vendors. You may get better prices, more favorable credit terms, and an equally dependable supplier. But buyers are often reluctant to change their existing arrangements.


A fear that a new supplier may provide sub-optimal quality

Apprehensions about raw material quality can hold chemical consumers back from signing on newly identified vendors. This is especially true for small and medium-sized consumers who do not have the infrastructure or resources to carry out a thorough verification of a vendor who has been recently identified.

In many instances, this reluctance to tie up with an untested supplier is justified. The risks are simply too great. Even one consignment of a raw material that does not meet the specified grade can upset the company’s production schedule.

Fortunately, there is a way to establish the reliability of a supplier before placing your first order.


Online platforms offer a ready solution

Using an online e-commerce platform for making chemical purchases gives chemical consumers the opportunity to place orders on suppliers who would have been inaccessible in the past. But the greatest advantage that these B2B platforms provide is that the feedback provided by earlier consumers for a particular supplier is visible to new buyers.

Does the supplier keep the commitments that have been made? Has the correct material been supplied? What are the quantities supplied to other buyers in the past? A company that wishes to place an order can get an idea about all these issues before committing itself.

In fact, the feedback and information that is available on an online platform can be invaluable. Chemical consumers can utilize discussion boards on the platform to seek solutions to their problems.


Crowd-powered solutions

In an article titled, “Using the Crowd as an Innovation Partner”, which appeared in Harvard Business Review, authors Kevin J. Boudreau and Karim R. Lakhani have pointed out that forward-thinking companies are increasingly using external inputs to find answers to their most difficult problems.

The paper gives an example of the benefits that crowds offer. The Harvard Clinical and Translational Science Center had been working on a difficult computational biology problem for years. In an effort to harness the intelligence and problem-solving capabilities of outside parties, the Center engaged TopCoder, a company that administers computer programming competitions.

Participants had two weeks to submit solutions. A total of 122 submissions were received with many of the suggested solutions surpassing the quality of those developed in-house by the Center over the years.

In a similar manner, chemical buyers can exploit the knowledge and experience of other buyers on the e-commerce platform. It is also possible to use the online platform’s discussion board to seek out solutions to specific problems. Buyers could also communicate directly with sellers with their specific queries. This facility is of great help as it provides companies the opportunity to access information from persons in the same line of business.


Online platforms offer the opportunity to identify pre-approved suppliers

By using an online B2B platform, chemical buyers would no longer need to rely only on their historical data or a subjective analysis to determine the ability of a supplier to provide the desired quality of raw material. Instead, they can use the data available on the online platform to take an informed decision about which supplier to deal with.

 

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#Digitalization in the Chemical Industry, #Pricing in Chemical Industry