Strategy and Business Model

Business Model

Brenntag’s growth opportunities along with its resilient business model are based on complete geographic coverage, a wide product and service portfolio and high diversity across suppliers, customers and industries.

Connecting chemical manufacturers (our suppliers) and chemical users (our customers), Brenntag provides complete distribution solutions rather than just chemical products. Brenntag purchases large-scale quantities of industrial and specialty chemicals and ingredients from a large number of suppliers, enabling the company to achieve economies of scale and offer a full-line range of products and value-added services to around 185,000 customers. Brenntag is the strategic partner and service provider for manufacturers of industrial and specialty chemicals and ingredients at the one end and chemical and ingredients users at the other end of the value chain. Brenntag stores the products it purchases in its distribution facilities, packs them into quantities the customers require and delivers them, typically in less-than-truckloads. Overall, Brenntag offers a broad product range comprising more than 10,000 chemicals and ingredients as well as extensive value-added services such as just-in-time delivery, product mixing, blending, repackaging, inventory management, drum return handling as well as technical and laboratory services for specialty chemicals.

Building on our strengths as the leading full-line distributor, we have, since the beginning of 2021, been managing Brenntag through two global segments: Brenntag Essentials and Brenntag Specialties. With this new operating model, we are setting the course for Brenntag’s successful future development by sharpening our profile in relevant industry segments and better serving our customers’ and suppliers’ requirements.

As an agile, lean and efficient distribution partner at local level, Brenntag Essentials markets a broad portfolio of process chemicals across a wide range of industries and applications. In this segment, we benefit in particular from our local market knowledge and our reach. This allows us to make targeted use of our economies of scale.

Brenntag Specialties is geared to expanding our market position as the leading supplier of specialty chemicals in six selected focus industries worldwide: Nutrition, Pharma, Personal Care/HI&I (Home, Industrial & Institutional), Material Science (Coatings & Constructions, Polymers, Rubber), Water Treatment and Lubricants. These focus industries are large, globally relevant sectors that offer significant potential for end-to-end solutions as well as our excellent technical and application-related expertise and are subject to high regulatory requirements.

Through the new operational set-up, we aim to serve our business partners faster, better and more comprehensively by concentrating even more closely on their changed requirements. Under the Brenntag umbrella, both segments will work equally towards strengthening and expanding our position as global market leader in the distribution of specialty chemicals and as a full-line distributor.

Brenntag is the global market leader in chemical and ingredients distribution. We define market leader not just by business volume but also associate it with our philosophy of continually improving the safety standards at our sites. As a responsible service provider, we continually strive to achieve further improvements in the supply chain as a whole.

Strategy

Our goal is to further expand our position as global market leader in an agilely changing global market environment and lead our industry as the preferred partner for customers and suppliers.

We strive to extend our market leadership through sustainable organic growth and by continuously and systematically increasing profitability.

At the beginning of 2020, we launched “Project Brenntag” with a view to laying strong foundations for future organic earnings growth. Through this broad transformation programme, we aim to adopt a more focused approach to our market activities, build stronger partnerships with our customers and suppliers, and reduce complexity. The core elements are the new operating model comprising two global segments with a strong focus on customer and supplier requirements, a distinct go-to-market approach derived from that, (infra-)structural topics as well as supporting people and change management measures.

In addition, we continue to seek acquisition opportunities that support our strategy. Our strategic focus here is on expanding our presence in emerging markets in Asia Pacific in particular so as to capture the expected strong growth in demand for chemicals and ingredients in these regions. In the established markets of Western Europe and North America, our acquisition strategy focuses on steadily optimizing our product and service portfolio.

Our people measures are centred on extensive employee skills enhancement and personal growth in alignment with the company’s transformation and on targeted succession planning. Through “Project Brenntag”, we will promote global collaboration, establish a new management culture and enable our employees to take on new roles. We will best position the Brenntag brand in the employment market so as to recruit and retain highly qualified employees.