Monday, 29 July 2013

Chemical Distributors Grows Worldwide - BCG Reports

News is Entitled as Opportunity for Chemical Distributors Continues to Grow Worldwide First on Yahoo Financial News section (Press Release: The Boston Consulting Group – Mon, Jul 22, 2013 12:01 AM EDT) and finchannel dot com’s Business category on 27/07/2013 10:58 (Where I found it while browsing) New Research by The BCG (Boston Consulting Group) “, the chemical industry is continuing to outsource its distribution to third-party distribution provider.

Between 2008 and 2012, the worldwide chemical distribution market grew approximately 9 percent per year, in nominal terms, to roughly €165 billion. Such growth outpaces the expansion in chemical consumption worldwide, at a nominal 8 percent per year over the same time period, reaching €2,560 billion in 2012, according to the report.

According to Udo Jung (BCG senior partner and coauthor of the report) Chemical distributors are growing faster than the overall industry due to two Main Reasons:
  • Increased outsourcing among suppliers
  • Greater value-added services offered by distributors.
Both are driven by industry trends, and neither is likely to change for the foreseeable future.
Overall, the chemical industry is large, fragmented, and diverse, with more than 100,000 products across a range of technical categories, including petrochemicals, solvents, polymers, and customized specialty chemicals. The size of the customer base for these products varies widely, as do regional and national requirements and logistical challenges driven by the chemical products themselves. As a result, manufacturers face significant complexity in getting their products to customers, and third-party distributors are increasingly considered a vital element of their go-to-market strategy, according to the report.

Many producers are developing “preferred partnerships” with key distributors—an approach that allows producers to expand into new markets. Among these markets, China is now the largest, worth about €35 billion. Among third-party distributors, Brenntag, Univar, and Nexeo Solutions were the three largest in 2011, with a combined global market share of 12.5 percent, according to BCG.

While third-party distribution has grown, there is still considerable room for expansion, as roughly €165 billion comprises just 10 percent of the overall chemical market. “Going forward,” said Stefan Scholz, a BCG project leader and coauthor of the report, “We expect the real growth rate in the chemical distribution market to slow from 7 percent to a stable 6 percent per year within the next five years, mainly due to a weaker underlying economic situation that will reduce chemical consumption,” he said. In addition, the report notes that distributors will continue integrating along the value chain, in order to provide more value-added services for customers and further reduce complexity for chemical producers.

To succeed in this environment, distributors need to strengthen their competitive position by expanding into new geographic regions and building their segment-specific expertise through acquisitions. Scale counts, and small and mid-sized players will only succeed by adopting a niche strategy and focusing on either a specific local territory or within a narrow band of industry expertise, said the report.

Resource Links :


  1. Great post, I appreciate you and I would like to read your next post. Thanks for sharing this useful information.
    Aim financial news
    AIM Mining news
    AIM Small cap shares
    Blur Group
    Fastnet oil
    Comms plc

  2. We are the manufacturer, supplier, trader and exporter of scientific educational laboratory equipment and instruments including physics, chemistry lab equipment click more

  3. My brother is looking for a chemical supplier for his business. I think that he has would like to look into this business. I know that he needs to find the right chemicals he needs soon.

  4. It would be no exaggeration at all if chemical products especially the research chemicals, are said to be a key part of scientific research for lab experts or specialists. This has given an apparent rise in the growth of popularity of chemical product suppliers who sell such stuffs to the needy clients or companies looking for high quality chemical products.

  5. Hi Everybody I really found the information quite interesting and let me introduce myself.
    We are Gayatri Dyes & Chemicals leaders in providing raw materials for liquid sindoor and other cosmetic industry.All the chemicals and colours that we provide are cosmetics grade and Indian Pharma passed.We can help you to make the products from better to best.

    Liquid Sindoor raw materials

  6. Nice Blog..

    If you want to get the best website Development & Design Services in Bay Area USA, visit Digital Acrobatics Technology today.
    Published By Digital Acrobatics Technology
    Call Us: +1-732-630-2120
    Email :