Marketing strategies commodities

Experienced market researchers planning a strategy that involves acquisition of a specialty chemical company by a commodity chemical producer have to be aware of these differences. Many such acquisitions have failed over the years because the commodity company management failed to recognize or refused to beheve these differences. 

Widen value chain participation. Finally, in some segments of the chemical industry (in particular specialties), opportunities stiU exist to use the traditional skills of R D and application development, but to target them at new customers further down the value chain. This move mirrors the approach attempted by many in the industry twenty years ago when they shifted portfolios from commodity to specialty chemicals in search of higher margins. It was not a particularly successful strategy at the time, both because of the number of players that sought to become specialty manufacturers and because the capital markets were skeptical about the growth opportunities for specialties. 

The overall financial context of the chemical industry gives investors plenty of other issues upon which to focus. The chemical industry is a capital intensive, cyclical business with mature products typically sold into commodity markets. It often does not earn its cost of capital (Lev, 2001a). This has led to a number of sales of mature assets in the industry to financial buyers (Firn, 2004). Overall, cost cutting reigns as the principle financial strategy while the capacity for innovation and growth is modest. 

The scandal was tied to a phenomenon that still dominates the business strategies of generic dmg firms to this day the need to obtain approval to manufacture and distribute before other firms enter the market. Because of the commodity nature of the business and the relative ease of entry into the industry, firms devote most of their resources and managerial talent to obtaining first or second approvals from the FDA for their products. Once a generic... 

The nylon market can be divided into two segments resin products and fibre products. The total consumption of nylon in Western Europe was 913,000 tons in 1993, of which 560,000 tons were fibre products divided among textiles, carpets, and industrial fibre [22]. The total annual nylon consumption, as well as that of other engineering plastics, is small compared to that of high-volume commodity thermoplastics for example, the consumption of LLDPE/LDPE for 1993 was 5,548,000 tons [22]. Engineering plastics therefore constitute a minor share of the total plastics waste. Nevertheless, for an environmentally responsible company it is necessary to develop a clear strategy for the recycling of products and to help their clients do the same. 

To accomplish this modeling, the demand and supply hierarchies must be decoupled to enable volume/mix what-if trade-offs iteratively between process steps. This S OP maturity stage requires the addition of two new capabilities demand translation and supply orchestration. The process of modeling demand volume/mix trade-offs between demand and supply is demand translation. In supply orchestration, trade-offs are determined and translated into buying strategies in commodity markets to determine the most effective formulation or platform design to schedule for manufacturing. 

The nonsupported metallocenes are used only in solution processes. The strategies for market penetration run from targeting commodities to specialty grades. 

Albert, T. C. (2003). Need-based segmentation and customized communication strategies in a complex-commodity industry a supply chain study. Industrial Marketing Management, 32(4), 281-290. 

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