Bulk Distributor Sept/Oct 16 - Page 12

12 BULKDISTRIBUTOR Russel Argo Richard Ward Russel Argo, President, Brenntag UK & Ireland, and Richard Ward, Commercial Director (Industrial Chemicals and Water Treatment) Brenntag UK & Ireland, reveal the company’s plans and forecasts across the chemical distribution sector and discuss the current market with Bulk Distributor... BD: The European region is providing good results for Brenntag. What are the standout successes in the new products and services underpinning this performance? Russel Argo: In recent years, Brenntag has invested in restructuring and optimising its business in Europe, and these investments now bear fruits leading to very encouraging growth in the existing business. Brenntag EMEA today presents as a unified business platform offering a high level of service excellence, dedicated industry know-how and consistent performance levels across the entire region. Brenntag is offering its customers a full-line portfolio of over 10.000 products of specialty and industrial chemicals as well as value added services which gives us a high competitive advantage in Europe. In the EMEA region our footprint in industrial chemicals has been exceptional: Brenntag realises its full potential by focusing on expanding its successful specialty chemicals business, which is already among the market leaders; our strategy for specialty chemicals is geared to industry focus and superior customer service; here we have upgraded our sales force and network with technical excellence and we are investing in application labs and blending facilities to create added value. There have been a number of exciting new developments over the last few months, across all the key industries and applications we operate in. For instance, we are the leading distributor of solvents (in bulk and packaged), offering technical services in performance fluids as well as distribution solvents. Our focus since the acquisition of Multisol in 2006 has been mainly on organic growth and our solvents business continued to go from strength to strength due to the well invested facilities, technical expertise to provide unique solutions, and our supplier base. We have taken on 17 new speciality chemical distribution agreements, all Cover Story September/October 2016 Exploring the chemical distribution se dedicated to specific portfolios in specific markets. We also supply bespoke solutions – either products that are designed for specific applications and replace more traditional solvents, or we blend solvents to meet certain performance criteria. There are four Brenntag solvent hub sites in the UK with over 14 million litres of storage capacity, drumming and IBC facilities and dedicated blend tank and small pack facilities. We have invested over £1 million on our main hub in Scunthorpe in the last 12 months, increasing our IBC filling capacity and new life science filling facility to supply more packed solvents into the food, feed and pharma sectors. Richard Ward: Over many years the UK & Ireland business has invested significantly in plant and logistics infrastructure. We have integrated own fleet and third party logistics partnerships. As an organisation we continue to operate an integrated model, which sees 100 Brenntag-owned trucks operating around the UK & Ireland. These support our bulk liquid chemicals business, both directly to customers and in terms of servicing our own distribution sites, general packed goods distribution, and 24 hour internal trunking. Built-in flexibility allows us to address customers increasing need for short-term ordering and reduced shipment size. In addition, we have strategic alliances with third party logistics providers who share our core aspirations around safety and service. We are introducing a fully integrated electronic delivery management system, which both ties in with our SHE requirements and ensures timely and accurate delivery confirmation. We also like the ‘4 eye’ principle, whereby both our driver and the customer’s representative have verified the product and storage tank are correct for the requested delivery. The electronic system we are implementing takes the driver through each of these stages on a tablet/smartphone and if there are any doubts about the safety of the delivery then it doesn’t go ahead. Once the checks have taken place, the delivery will be made and on completion the customer and driver will ‘sign’ the tablet/smartphone. This then acts as confirmation that the delivery has been made safely and in accordance with the customer’s requirements.” BD: Looking ahead, has Brenntag identified any “hot spot” areas or sectors that it is preparing for in terms of investment and focus? RA: As the market leader, Brenntag aims to contribute to more sustainability in the BD: In terms of acquisition strategy, how would you describe Brenntag’s M&A pipeline? RA: Alongside organic growth, mergers and acquisitions are another pillar of Brenntag’s strategy. The global distribution market remains highly fragmented, facilitating significant further consolidation potential, and Brenntag intends to play an active role as market consolidator in selected regions and segments. 2015 was an exceptional year for Brenntag in terms of realised acquisitions amounting to an investment volume of €550 million globally. Brenntag expects to revert to its traditional €250-300 million acquisition spend in 2016. While Brenntag already has a truly global footprint, we are constantly working on a number of potential targets, always striving for the improvement of our portfolio. Acquisitions, alongside organic growth, are one of the pillars of our strategy. At Brenntag, acquisitions have three main objectives: building up scale and efficiencies, expanding geographic coverage and improving the full-line product portfolio. Bolt-on acquisitions to complement our product portfolio are an important part of our strategy. We have a long and successful track record of acquisitions, as you see throughout the history of our organisation in the UK and Ireland and globally. We therefore continue to seek acquisition opportunities that support our overall growth strategy. BD: What other strategic initiatives are in the pipeline? RW: I would mention the development of paperless delivery methods through signatures on glass and confirmed pre-delivery checks and inspections. supply chain of the chemical industry; since July 2015, Brenntag has been a member of the chemical industry ’s Together for Sustainability initiative (TfS) – as the first and, so far, only chemical distributor. The initiative’s goal is to establish a uniform global programme for the responsible procurement of goods and services in the chemical industry, to achieve transparency in relation to sustainability performance throughout the supply chain and to make further improvements to its suppliers’ ecological and social standards. Environmental industry (comprising water treatment, leisure including chemicals for swimming pools, and AdBlue) remains one of the key areas for growth, where addressing regulatory challenges is a must, and is undoubtedly an area of strength for our company. We have invested in further development of our significant AdBlue business: our brand offers solutions to large truck fleets and consumers alike, supplied to several OEM engine and vehicles manufacturers, both dealerships and factory fill. We are delighted to be partnering with Yara (one of Europe’s leading suppliers of AdBlue), giving financial and professional security to our customers. Our differentiators are the expertise of our teams, high quality product, bespoke equipment (for innovative ways of dispensing and significant cost savings), and strength of supply for the continuous and reliable source of high quality urea that meets ISO standards. We supply only factory-manufactured product with full traceability and rigorous quality and testing regime, thus offering some of the highest standards of Health and Safety in the industry. Ingredients manufacturers recognise the need for new product development to remain at the leading edge of the market, and look at their distributors to stem the flow of innovative ideas to address trends pertinent to their markets. Our market intelligence shows that sustainability as a market driver will only accelerate, as industry regulations will stipulate the introduction of more sustainable alternatives. For instance, the introduction of the EU Biocides Regulation in 2013 led to the development of Clorious2 – an innovative chlorine dioxide solution that allows manufacturers to overcome the limitations associated with conventional chlorine dioxide generation techniques – the safest, most effective chlorine dioxide delivery system. Brenntag Clorious2 is ready to use, requires no on-site mixing or activation period, and is characterised by its long-term stability for safer usage and storage. RW: We have a number of developments in our product range to offer to the renewable energy sector. The market has seen and continues to see a shift in the profile of its power generation technology away from traditional fossil fuels to renewable sources and this change requires a different approach from the chemical sector. The renewable energy sector uses different chemicals in the power generation process when compared to fossil fuels and we have developed our product range accordingly. We have a team of energy specialists already highly active in the sector and this knowledge has enabled us to tailor our offering to meet the changing needs of the market so now, alongside the commodity chemicals, we have a range of products developed specifically for the sector. We see the demand from renewables increasing over the coming years and we should be in a good position to support this growth. BD: Is there any volatility forecast in any of the current areas of operation? RA: There is growing demand for higher levels of service and efficiency. Our infrastructure is unrivalled in the industry, as we operate from 22 distribution and manufacturing sites, with nearly 900 employees and a fleet of over 100 owned vehicles. In recent years, Brenntag has made a conscious choice to move from a heritage in industrial chemicals and focus more on specialities and value added services. Brenntag UK & Ireland has invested heavily to expand its speciality