Service is something Brenntag considers to be especially important and this 2016 Annual showcases examples of the different ways in which Brenntag employees provide valuable services to the company’s partners every day. In this interview, CEO Steven Holland and CFO Georg Müller talk about the importance of service in chemical distribution and at Brenntag.
OUR ANNUAL REPORT FOR 2016 FOCUSES ON SERVICE. WHY IS THIS SUCH A KEY ISSUE IN CHEMICAL DISTRIBUTION?
STEVEN HOLLAND: Chemical distribution is a complex business with significant sales and marketing resources, but some people still think of it as a purely logistical service activity – that is to say, transporting chemicals from A to B. Logistics do of course play a major role, but chemical distribution is now much more than that. True to our slogan “We’re ConnectingChemistry”, we are the preferred chemical distributor by virtue of our service focus, connecting customers and suppliers in a fruitful partnership. For us, services delivered to a high standard of quality and reliability are the basis of a sound partnership.
CAN YOU GIVE SOME EXAMPLES OF SERVICES?
GEORG MÜLLER: The chemical distribution value chain is made up of a wide variety of functions and we basically add a service to each customer order: Brenntag buys chemicals in bulk and stores them at our sites all over the world. The bulk quantities are then filled or repacked into smaller quantities tailored to the customer. Our service philosophy also includes ensuring that the right products of the right quality are always available at short notice.
STEVEN HOLLAND: But our services are of course much more multi-faceted, as we have a broad customer base of around 185,000 customers spanning all possible end markets. We put ourselves in the shoes of our partners – both customers and suppliers – and ask ourselves: “How can we help our business partners to succeed?” This is precisely where our service then comes into play: we offer our customers manifold and specialized handling services which streamline their production process – among others in our life science business.
ARE THERE ANY PARTICULAR CHALLENGES IN THE SPECIALTY CHEMICALS SEGMENT?
GEORG MÜLLER: In specialty chemicals in particular, the services we offer are becoming very complex very quickly. They require not only the infrastructure – which at Brenntag is our application centres equipped with the latest technology and equipment – but also highly qualified staff who know the products and how they work and always have their finger on the pulse of market trends. Specialty chemicals products are developed through a relatively lengthy joint working process between the customer and Brenntag. Our application engineers offer technical support and advice and are experts in the myriad customer industries.
THAT IS INDEED A DIVERSE RANGE OF SERVICES, BUT AREN’T THEY OFFERED BY OTHER CHEMICAL DISTRIBUTORS TOO?
STEVEN HOLLAND: Certainly some of the services mentioned are also offered by our competitors, but we are confident that both the quality of the services and the portfolio of services on offer set us apart from all competitors. Here too, we see ourselves as a full-line distributor and wish to serve all customer requirements.
YOU ALSO MENTION SUPPLIERS. WHICH SERVICES PLAY A ROLE HERE?
STEVEN HOLLAND: Our suppliers are the chemical manufacturers. For them, we act as an effective sales and marketing channel by bringing their products quickly and efficiently to precisely the right markets. The chemical manufacturers build on our market expertise and access to a broad customer base where we provide a very effective channel to market for their products, making them available to a much wider market of end consumers.
HOW DO YOU GUARANTEE THIS IMPORTANT ACCESS TO MARKETS AND END CONSUMERS?
STEVEN HOLLAND: At the heart of the Group are our staff, and each and every Brenntag employee makes a valuable contribution on a daily basis. However, our sales and marketing organization in particular is vital in this regard. More than a third of the Brenntag workforce of about 15,000 employees works in sales and marketing. Through continuous personal contact, they ensure that we always actively approach our partners and focus on their requirements. The aim is to offer our partners individual and tailored solutions at all times, and to do so quickly and to the highest standard of quality.
SO THAT IS BRENNTAG’S PLACE IN THE SUPPLY CHAIN. BUT WHAT EXACTLY ARE THE BENEFITS THAT BRENNTAG BRINGS TO ITS PARTNERS?
STEVEN HOLLAND: The benefits that Brenntag offers are diverse, as we focus our activities on our partners’ requirements. We reduce complexity for chemical manufacturers by taking on the very granular business in less-than-truckload quantities, for example. We also make life easier for our customers. Expressions such as “one-stop-shop solution” are common in chemical distribution, but that is exactly what we are for our customers. Through our broad portfolio of products and services, we offer customers everything they need from industrial chemicals to highly specialized life science products and services! That is how we achieve our primary objective, namely to increase the profitability of our partners and Brenntag.
GEORG MÜLLER: Because we offer a very broad range of services, our partners are able to concentrate on their core business. We give them more flexibility and make them more efficient – and all over the world too! Chemical distribution is also a local business. Each Brenntag company must adapt to the local conditions specific to a country or region. That applies to customers, suppliers, macroeconomic conditions, market characteristics and individual trends in the customer industries. Safety and quality are also very important to us as a global market leader. Health, safety and sustainability are paramount for Brenntag. In this respect too, we aim to offer our partners the highest standards.
SO CHEMICAL DISTRIBUTION IS A COMPLEX, VERY INDIVIDUAL BUSINESS. HOW, IN YOUR OPINION, DOES BRENNTAG DIFFERENTIATE ITSELF FROM COMPETITORS?
STEVEN HOLLAND: We are the global market leader in chemical distribution – and for good reason. Brenntag offers an unparalleled combination of a highly efficient logistics network, a broad product portfolio of industrial and specialty chemicals and a diverse service offering. We combine global reach and the benefits of a global market leader with local proximity and excellence in execution for our partners. We not only offer our customers solutions that are tailored to them, but are also the preferred distributor for chemical manufacturers. All that and in particular the excellent relationships of trust that we have built with our partners over decades give Brenntag a decisive competitive edge. We can continue to build on that going forward!