For decades, the chemical distribution industry has served as a critical supply chain partner to paint and coatings manufacturers and end users. Distributors have established a unique set of skills and expertise to help facilitate the safe transport of specialized chemicals under stringent industry standards.

The relationship between chemical distribution and the paint and coatings industry has evolved significantly over time. In the early days, chemical distribution was primarily transactional, focusing on supplying customers with base chemicals, solvents, and pigments to fulfill orders. This distribution was mostly handled at the local or regional level. However, in today’s global economy, the landscape of offerings has evolved, with chemical distribution professionals now providing greater value-added services. 

There is now diversification in the products and services offered by both industries. In the late 20^th century, consumer consumption expanded and so did the offerings of manufacturers and distributors, ultimately leading to a substantial increase in market size. This includes the shift from commodity chemical distribution to specialty chemical distribution that helps address the specific needs of the paint and coatings industry and its customers. 

Since its founding, Alliance for Chemical Distribution (ACD), formerly the National Association of Chemical Distributors, members have not only developed the logistical expertise to get essential chemical products where they need to be safely and effectively, but have also established advanced industry knowledge and technical support to anticipate what their supply chain partners are looking for, including specialization, technical know-how, and compliance and supply chain support.

As our world becomes more interconnected than ever before, the chemical distribution industry, and its supply chain partners like paint and coatings professionals, must remain nimble to maintain a competitive edge. They can do that by recognizing key market trends and responding to customer needs through innovative technologies.

Market Progression of the Paint and Coatings Industry

Although paint, ink, and coatings have been present since ancient times, with early pigments used on cave walls to depict and memorialize everyday lives, it wasn’t until the early 1700s when paint began to be commercialized for aesthetics and other functional purposes. 

Eventually, the Industrial Revolution catapulted the industry even further to become a recognized component of the national economy. Today, the market value of the industry in the United States comes in around $37 billion. 

As part of this tremendous growth, the paint and coatings industry has experienced changes driven by technological advancements, sustainability initiatives, regulatory changes, and evolving consumer demands. The development of synthetic pigments, additives, and binders provided long-lasting, durable, and weather-resistant coatings that revolutionized the industry. There are now two broad categories of coatings: decorative and industrial.

Decorative coatings are used for the interior and exterior surfaces of both residential and commercial buildings. Chemical distributors help fulfill the formula needs that make up the enamels, varnishes, and stains of these paints. There have been shifts in color trends, ease of application, and finishes. Customers have an increasing preference for products that are not only durable, but also prioritize volatile organic compounds (VOCs) and environmental impact, particularly when it comes to their everyday products and the paint in their homes.

Industrial coatings, on the other hand, have incorporated some of the technical advancements that have made formulas more weather resistant and corrosion proof. These coatings are used across countless industries, including automotive, manufacturing, aerospace, military, construction, and electronics. Products in this category are defined by their protective properties rather than aesthetics.

Consumer demands have changed over time with variations to the formulas of decorative and industrial paints. Consumers are now looking to the industry, and their supply chain partners like chemical distribution experts, to ensure their products are functional, consistently performing, and sustainable. From practical and decorative coatings to industrial coatings, there is now a variety of products and formulas offered for specific applications, and for a range of end users. 

Chemical Distribution Responds to Customers’ Evolving Demands

Similarly, over time, the chemical distribution industry expanded its offerings as market and consumer trends have changed. ACD members and their supply chain partners have made significant improvements to the resins, solvents, pigments, and additives that are required for durable, high-quality paints and coatings. The processes of formulating these products have also been updated in recent years. For example, ACD members have prioritized and take great pride in the precise mixing, grinding, dilution, filtration, and finishing of their mixtures to provide resilient, ecological, and high-performing products to their customers. 

Our supply chain partners not only rely on chemical distribution professionals to process, blend, and formulate some of these critical materials for their business, but they also trust the logistical expertise and technical background that is required to deliver these products safely and efficiently. In fact, the variety of roles the chemical distribution industry plays across various sectors has expanded exponentially. Chemical distribution is just one facet of the business functions that ACD members oversee. Our members are also blending specialists, tollers, marketers, warehouses, specialty manufacturers, and more. These various business functions, and the specialized expertise provided, are a result of our industry responding to the evolving needs of our customers, including our paint and coatings customers. 

ChemCeed, an ACD member and full-service woman- and minority-owned chemical supplier based in Chippewa Falls, Wisconsin, provides high-quality raw materials and services to paint and coatings professionals to help them create vinyl coatings, flame retardants, plasticizers, pigments, and solvents. Rolly Enderes, Vice President of ChemCeed, underscored the company’s approach to meeting customers’ demands. 

“Over the last 10 years, there has been a growing trend of suppliers providing more environmentally safe and bio-based products. Our customers are expecting us to take steps to transition our products to be more sustainable. However, a mass-balance approach must be met, and performance is still paramount for our paint and coatings customers.”

The chemical distribution industry has enhanced its offerings to ensure functionality, while embracing commonsense sustainability initiatives, such as the replacement of traditional synthetic materials and offering low-VOC products. All of this would not be possible without the technical advancements and innovation available today. 

Adoption of Technological Advancements

Apart from strong sustainability initiatives, the chemical distribution industry has used breakthrough technologies to meet evolving market trends.

One noteworthy change in the chemical distribution industry has been the shift from commodity chemical distribution to specialized chemical distribution, which has given small- and mid-sized businesses a unique opportunity to partner with specialists that bring innovation within reach. ACD member Van Horn, Metz & Co. (VHM) sources materials and processes from around the globe, and shares these breakthrough products with its partners, such as paint and coatings professionals. 

“Promoting innovation is at the core of what we do,” said A.J. Crofford, Director of Marketing and Principal Management at VHM. “By identifying cutting-edge materials from across the world, we can bring new products and opportunities to our partners and the customers they serve. Our outsourcing is also paired with technical support to ease customer concern over lead time, advocate for fair prices on their behalf, and ensure that our manufacturing partners are upholding the highest industry standards.” 

Recently, VHM identified an alternative use for an aerogel, which has been previously used to insulate aerospace materials. VHM’s partnership with Svenska Aerogel developed a new and more affordable process of using this aerogel to insulate buildings. VHM was able to connect their local and regional partners in the United States with this innovative technology, which set their customers apart from other offerings on the market. 

As companies in both industries look to the future, increasing operational efficiencies is also key to staying competitive. While some businesses are still trying to determine the use or impact of artificial intelligence (AI) as a part of their business, ChemCeed has begun to explore its research and prospecting capabilities. 

“Through generative AI, we are investigating the topics or catch phrases that are currently used in the industry,” said Enderes. “We use this information to determine how we can better integrate, update, and refine our messaging. This is still a work in progress, but this tool helps our small business stay up to speed on the language that resonates with our end users.”

The adoption of the latest technology can enhance the products and services the chemical distribution industry can provide our partners, and ensure they remain competitive in the years to come. 

Positioned for Growth

Long-term success for both the chemical distribution and paint and coatings industry relies on its ability to respond to the various market trends and evolving customer needs.

During the pandemic, the federal government recognized the critical role of the chemical industry by categorizing it as an essential industry. And despite high inflation and ongoing disruptions to the supply chain, chemical distribution remained a steadfast and resilient industry partner, underscoring the value of chemical distribution in America’s everyday products and the success of business both small and large.

Value-added and solutions-oriented services set distribution professionals apart. Principles such as customer support, formulation support, logistics, data transparency, regulatory support, and customer data utilization help ACD members stand out and boost trust among our paint and coatings partners. These valued services also give paint and coatings businesses a competitive edge, allowing them to quickly and effectively respond to customer needs and provide innovative products while maintaining functionality, durability, and sustainability.

For more information, visit the ACD website here.