When the Alliance for Chemical Distribution (ACD) set out to rebrand nearly two years ago, we learned an interesting fact about our members: Very few companies today consider themselves as chemical distributors alone. Instead, our members conduct a range of critical functions that ensure the safe and efficient movement of chemicals, including processing, formulating, blending, packaging, warehousing, transporting, tolling, marketing and more.

As the supply chain has changed over the years and become more globalized, so have the industry’s roles and responsibilities. Today, the offerings of chemical distribution professionals are more diversified than ever before. On average, our members choose more than three business functions to describe what they do. We aren’t just transporting the essential chemicals needed for nearly every sector in the nation   —  the operations and services are practically endless.

Very Few Companies Today Consider Themselves Only Chemical Distributors

The industries our members support have also expanded. ACD members support a broader base of sectors within the chemical supply chain, which includes paint and coatings, general manufacturing, water treatment, petroleum and lubricants, pharmaceuticals, adhesives and sealants, personal care products, plastics and agriculture. The downstream connections are infinite.

We thought it might be helpful to share a glimpse into the deep expertise and customer-driven offerings our members provide to keep a range of industries competitive today. We take pride in the expertise our members can offer to their partner industries as they navigate evolving challenges and new opportunities. This is particularly important as the business and regulatory landscape continues to evolve.

The Expansion of Core Business Functions

As our paint and coatings partners understand, chemical distribution is essential to connecting producers with industrial end users across a spectrum of sectors. The functions of ACD members go well beyond just transporting chemical products from one point to another. There is a complex range of activities and roles that chemical distribution professionals take part in. Here’s an overview:

• Sourcing and procurement: Identifying and establishing relationships with manufacturers in the U.S. and across the globe to ensure a reliable supply of chemical products
• Logistics and supply chain management: Overseeing the safe and efficient movement of chemicals across every stage, including the production, handling, transportation and storage of products
• Consulting: Providing valuable insights into product performance, market dynamics, troubleshooting and solving supply chain challenges for clients, and assessing risks and identifying new or better commercial partners downstream
• Warehousing and inventory management: Operating storage facilities to ensure the proper, safe and secure storage of diverse chemicals while optimizing inventory levels to minimize costs and meet evolving demands
• Packaging: Overseeing various packaging and storage requirements (e.g., exposure to heat or cold and/or sterile environments) to ensure proper quality, labeling and documentation
• Sales and marketing: Developing strategies and sharing learnings to meet the needs of customers and target markets while building and maintaining customer relationships through various channels
• Regulatory compliance: Ensuring compliance with local, state and federal regulations for the handling, storage, labeling, secure transportation and safe delivery or disposal of chemical products
• Safety, health, environment protocols: Upholding the highest standards of environmental, health, safety, security and sustainability within the chemical industry and demanding continuous improvement through ACD Responsible Distribution™

ACD member Royale Group, a collection of specialty chemical companies with expertise in sourcing, importing, transportation, warehousing, consulting and now manufacturing, has helped customers  —  like paint and coatings professionals  —  optimize their businesses by honoring their core values, providing transparent supply chains and delivering domestic manufacturing solutions.

“Demand can be somewhat inconsistent month to month, but we can provide value to our customers by maintaining stock and managing the inventory locally,” said John Logue, CEO of Royale Group. “This reliable service and predictability can better meet our customers’ needs. Transparency up and down the supply chain also gives us the ability to develop long-term relationships that are built on trust.”

As manufacturers and other end users navigate recent uncertainties in the supply chain, Royale has also recently provided valuable insight as a logistics expert.

“Since we focus on specialty chemical and pigment sourcing in Asia, these past few weeks have really given us the opportunity to offer a level of expertise in the dynamics of our global trade and impacts to businesses across the supply chain,” continued Logue. “We’ve had many conversations with our customers not only about pricing, but how to manage the situation and uncertainty. This value-driven service is something we are proud of, and it reassures our customers that we are in it for the long haul, finding the best, most cost-effective solution together.”

Meeting Evolving Downstream User Needs

ACD is made up of small businesses with fewer than a dozen employees to global companies employing tens of thousands of people. The majority of ACD members, however, are small businesses with an average of 28 employees and median sales of $42 million. Regardless of their size, ACD members provide specific services based on individual client needs, which include:

• Blending and formulation: Developing customized chemical blends and formulations that not only meet specific customer requirements but adhere to health and environmental standards
• Technical support and expertise: Offering technical and logistical advice, product information (including the newest innovative products) and application support to customers
• Recycling and waste management: Facilitating the safe and efficient recycling and waste management of the packaging and of chemical products

Superior Industrial Solutions, an ACD member headquartered in Indianapolis, is a key supplier to the paint and coatings industry. Over the years, Superior has positioned itself as a true resource for its customers, going beyond product supply to develop better ways for its partners to do business.

“Being a full-service distributor starts with the customer,” said Mike Sullivan, Superior sales development manager. “Our main service is problem-solving. We listen to our customer base   —  what they want, what they need, and what other companies are not doing   —  so we can fill this gap. That’s how we provide the most value to our customers, and that starts with a strong customer partnership to drive robust service offerings.”

Apart from providing raw chemical materials and high-performance formulations, one capability has distinguished Superior from its competitors: recycling and waste management.

“One of the main offerings we’ve added to our portfolio, that sets us apart, is our solvent recycling and hazardous waste management,” continued Sullivan. “Safely recycling and disposing of these materials can be a costly undertaking for our customers. But we can safely recover 90 percent of our customers’ spent solvents and properly dispose of hazardous and nonhazardous materials within compliance requirements and providing greater convenience. Superior can serve as a one-stop shop for customers’ purchasing, handling and disposing needs, providing greater value and convenience to our customers.”

Industry Trends

By diversifying their offerings, chemical distribution businesses have been able to better adapt to changing market trends, especially in the paints and coatings industry. Royale has done just that by adding manufacturing to its offerings.

“The global nature of the chemical supply chain represents a big challenge, but also a big opportunity,” said Logue. “We decided years ago that to diversify our business and offer more solutions to our customers, we must expand into manufacturing domestically, which now includes contract manufacturing, specialty, high-speed packaging, bulk unloading and reaction chemistry. Royale’s expansion into this area puts us in a strategic position for this moment and for our customers downstream.”

Here are a few of the other trends ACD members are monitoring:

• Artificial Intelligence (AI): The industry is increasingly leveraging AI across operations to enhance efficiency, refine communications and improve operations. Examples include forecasting on sales and market trends, optimizing inventory management and logistics management. Additionally, the industry is integrating AI to better understand safety patterns and to predict market demands so companies can anticipate the needs of businesses and customers.
• Consolidation: This has become a notable trend that we are experiencing in the chemical distribution space. Regulatory burdens or succession challenges have given smaller companies an interest in acquisition, while other opportunities like growth and diversification have driven businesses to pursue this route. As noted above, the expansion of manufacturing capabilities has given distribution companies the ability to fill specialized niches that even larger companies can find indispensable.
• Logistics: Members utilize platforms such as the Enterprise Resource Planning system, which integrate various business processes like accounting, supply chain management, customer relationship management and human resources into a central, unified system. This improves operations and efficiencies for the industry and supply chain partners.
• Sustainability: Standards around environment, health, sustainability and safety have become a focal point for ACD members and their customers, like those in the paint and coatings industry. Prioritizing the safe and responsible handling and storage of chemical products, supply chain transparency, product stewardship and improving efficiencies are essential to the competitiveness of our members and supply chain partners.

Chemical distribution professionals are constantly adapting to client needs and market trends, expanding their own offerings and business functions to ensure their customers are supported and remain competitive in the ever-increasing global economy. ACD members are constantly evolving to help both large and small companies find success in the highly complex  —  and regulated   —  chemical supply chain. To learn more about ACD’s members or ACD Responsible Distribution™, visit www.acd-chem.com.