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Sector platforms in the chemical industry How do service and logistic providers react Content Company Profile Bargelink a public marketplace Chemical industry Characteristics E-Business Marketplaces private or public Types of marketplaces Marketplaces and function in order process

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Presentation Transcript
content
Content
  • Company Profile
  • Bargelink a public marketplace
  • Chemical industry
    • Characteristics
    • E-Business
  • Marketplaces private or public
    • Types of marketplaces
    • Marketplaces and function in order process
    • Analyze for Chemical products and logistic services
    • Public or Private
    • Lowering logistic cost - Choices
  • Conclusion

R.R.J. Brouwer; 20 Feb, 2002.

company profile

Pakhoed

Van Ommeren (1839)

Vopak today

  • Leading global position in each of its three core businesses
  • Over 24 million m3 of tank storage
  • 75 tank terminals around the world
  • 225 chemical distribution facilities
  • Access to approximately 225 vessels
  • Integral part of global oil & gas and chemical logistics and distribution infrastructure
  • Sales of EUR5.6bn (FYE 2000)* and EBITDA of EUR535m (FYE 2000)*
  • Listed on Euronext

Chemical Distribution

Chemical Logistics

Oil & Gas Logistics

Company Profile

Vopak’s historic development

Blauwhoed (1616)

Pakhuismeesteren (1818)

Ellis & Everard (1848)

1967

1999

2001

  • 75 years of chemical distribution experience
  • 400 years of logistics experience

R.R.J. Brouwer; 20 Feb, 2002.

Note: * Including 12 months Ellis & Everard, acquired in January 2001

slide7

Das Bargelink-Prinzip

  • Praxisorientierte Prozesse und Datenbänke
  • Einfache Menübedienung
  • Jeder Nutzer bestimmt seine Geschäftspartner
  • Konditionen und Bedingungen für Transporte frei wählbar
  • Kosten (1,25% vom Transportumsatz) nur bei Erfolg
  • Keine Registrierungskosten
  • Hohe Datensicherheit durch SSL-Verschlüsselung

R.R.J. Brouwer; 20 Feb, 2002.

bargelink lessons learned
Bargelink lessons learned
  • E-Readiness of market participants has been underestimated, but interest and activity are growing
  • We knew from the start that the mineral oil barging market is too small, so since sep 2001 also open for dry goods
  • Manage your burn rate, listen to your customers

R.R.J. Brouwer; 20 Feb, 2002.

the chemical industry
The Chemical industry

R.R.J. Brouwer; 20 Feb, 2002.

chemical industry characteristics
Chemical Industry Characteristics
  • Hazardous materials (mainly liquids)
      • Safety, Health and Environmental protection is top priority
      • Responsible Care: Standards for service providers
      • Service provider needs to comply with minimum requirements
    • Hurdle to continuous change of partners
  • Global industry community
      • Many intra company relationships (sales between companies)
    • Strong drive for standardization on non-competitive items
  • Established industry
      • Mainly commodity products
      • Strategic focus on cost reduction (manufacturing & supply chain)
    • Price pressure on service providers
    • But also partnership to take real cost our of supply chain

R.R.J. Brouwer; 20 Feb, 2002.

chemical industry e business
Chemical Industry & e-Business
  • Adapted late to new technology: 1999
  • Like any other industry boom in 1999/2000,

publicity around marketplaces focus extra revenue

  • 2001 Back to reality: Marketplaces consolidated by M&A
  • 2002 Lower industry results : Focus on cost decrease
  • Chemical industry immediately realized standardization will be key to success:
    • CIDX developed Chem-e-Standard for XML messages
    • Elemica : Connectivity Hub initiative of 23 large companies

R.R.J. Brouwer; 20 Feb, 2002.

marketplaces
Marketplaces

R.R.J. Brouwer; 20 Feb, 2002.

types of market places
Types of Market places

Buyer

Buyers

Bank

Buyer

Marketplace

HUB

Marketplace

Seller

Seller

Seller

Logisticprovider

  • Marketplaces fulfill several roles, need to segregate for a meaningful analysis

R.R.J. Brouwer; 20 Feb, 2002.

slide14

Market places – Function in order process

Chemical products: Marketplaces (browser)

2000

Elemica (XML)

2001/2002 2H02/2003 2003

Promotion

Request price

quote

Negotiate price

Order & Acceptance

Invoicing

& payment

Customer

feed back

Delivery

Request price

quote

Negotiate

price

Invoicing

& payment

Order logistics

Transport

The related transport process flow

R.R.J. Brouwer; 20 Feb, 2002.

marketplaces chemical products
Marketplaces Chemical products

R.R.J. Brouwer; 20 Feb, 2002.

marketplaces logistic services
Marketplaces Logistic Services

R.R.J. Brouwer; 20 Feb, 2002.

private or public
Private or Public
  • Proof of the pudding is in the eating:
    • No public marketplace is profitable yet!
    • Private marketplaces give internal efficiency gain (at least)
  • Need to take functionality into account
    • Find those functions that give benefit to all parties involved
    • How to share these benefits
  • Nightmare: All clients work via different systems
    • Standardization will be key to success
    • Public marketplaces can play a role in standardization development

R.R.J. Brouwer; 20 Feb, 2002.

transportation marketplaces lowering logistic cost choices
Transportation marketplaces Lowering logistic cost - Choices
  • Spot relationship:
    • Shipper achieves lowest rate, but uncertain of acceptance
    • Transporter fills empty legs, if fit with offers
    • NEED: Very high liquidity and open market, no constraints.
    • Marketplaces can be an efficient approach for RFQ
  • Contract relationship:
    • Partnership allows for guaranteed fulfillment and quality level
    • Take total cost of supply chain into consideration,
    • Fundamentally decrease cost in parts of process
    • NEED: Trust, openness and willing to jointly reduce cost
    • E-Business: Automatic ordering, order track&trace, collaborative planning

R.R.J. Brouwer; 20 Feb, 2002.

conclusion
Conclusion
  • There will probably be a mix of private and public marketplaces in the short term so LSP should be flexible in order acceptance.
  • After initial focus on RFQ/negotiation part of the process, the focus has shifted to order fulfillment and the logistic order process
  • Vopak effort is currently focused on fulfillment part:
    • Transparency: Order track&trace
    • Automation of orders (avoid errors)
    • Planning of order fulfillment (experiment)

R.R.J. Brouwer; 20 Feb, 2002.