Digitalizing chemical supply chains

Digitalizing chemical supply chains

Growing customer expectations, new technologies and globalization signal a new era for chemical companies and their supply chains.


Key contacts

Ramanathan Venkataraman

Senior manager

KPMG Nederland

Hands holding tablet

Increased pressures

As B2C companies enhance their processes to meet increased customer expectations, B2B chemical companies must follow suit. Same-day delivery without increased prices demand B2B businesses streamline processes and optimize their supply chains to better serve the customers’ needs.

As these companies enter new markets, they must employ similar tactics to stay competitive as pressures rise on prices, revenues and profits. Using data and technology, chemical companies can meet the demands of several markets and a wider range of customer segments, which will, in turn, help them achieve growth on a global scale.

Digital tools and benefits

Following B2C examples, chemical companies can take advantage of digital tools to facilitate growth and lower the cost of current or future services. Advanced analytics, the internet of things (IoT), robotics and artificial intelligence (AI) allow companies to optimize their supply chain. This strategy will improve their delivery times and reduce the need for human input, which increases safety, efficiency and transparency. New streamlined processes create additional opportunities for chemical companies with a greater range of products and services to deliver different customer segments.

Digital tools can also help chemical companies gain an advantage through a differentiated approach that creates regional ecosystems. A localized network of smaller outsourced partners provide the necessary resources to manage logistics more effectively and serve an on-time, in-full delivery guarantee.

A wide range of digital tools can prepare data, visualize different angles on existing data, and generate new insights into customer behavior. Companies that realize the benefits of optimization—improved speed of strategy execution and visualization—can lower prices and operational costs, and potentially gain a leading edge in the market.

Supply chain transformation

To achieve a digitalized supply chain, companies need a strong plan:

  1. Assess current state based on customer prioritization, number of shipments and shipment volumes.
  2. Define initial distribution centers using customer gravity maps, the locations of strategic clients and initial storage locations.
  3. Assess potential locations and assumptions for costs by defining possible scenarios and using optimization logic.
  4. Create a future supply chain network based on a comparison of the different optimization scenarios and a critical assessment of the current state versus the desired future state.

The future state awaits, and chemical companies can achieve sustainable growth by leveraging emerging technologies to optimize their supply chain. With the possibility of digital transformation at zero cost, companies can achieve a lot more for a lot less and thrive with a customer-centric focus to their B2B enterprise.

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