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1、Detail Marketing and Sales Plan Development StudyCholine Chloride,January 12 16, 2008 Riyadh,An Interim presentation to,Stage 2 deliverables (Screening),Overview of the deliverables,Stage 3 deliverables (Demand),Stage 4 deliverables (Supply),Supply demand analysis and product allocation,Stage,Object
2、ives,For target markets: Potential in 2010 - 2020 Broad level Prospect profile (database): business, consumption, grades, Suppliers, packaging a 3rd party certification is needs sufficient Approval process takes up to 1 week maximum Approval of powder takes longer approval procedure is maximum 1 mon
3、th For carrier, nutritionist needs to look at moisture content, color (light brown preferred), adherence, mold (might need little bit more time with a carrier) Reliability of supplier plays a role in getting approval faster Plant visits by customer are not required but are good for relationship buil
4、ding for the long term,Choline ChlorideTypical Sales Contract,Typically spot prices Very large customers would typically get longer term contracts Normally no penalty clauses in the event supplier is not able to deliver the required volumes Some companies go for exclusive distributors but rarely pro
5、vide volume based incentives such as rebates Volume incentives have strongly diminished in the industries due to low margins,Choline ChlorideTypical Distributor Requirements,There is no guarantee of supply to distributors suppliers will sell where they can get best price In general, very little prot
6、ection for distributors In South East Asia and China, distributors are often only acting as a “trader” whereby they get a 3% commission but where the customer collects the choline chloride directly from suppliers warehouse In some of the more fragmented markets, distributors add more value. In these
7、 cases distributor margins can be 10-15% of sales price Customers prefer to go to distributors since they take care of issues such as quality, paper work and provide informational seminars Personal relationships are important in this market and distributors have numerous relationships with the appro
8、priate individuals Distributors are not general chemical distributors but focused animal feed industry selling such products like lysine, methionine Distributors cross-sell other products like antibiotics, vitamins to the customer to increase sales and margins Payment Terms Within South East Asia an
9、d China, suppliers often insist upon a Letter of Credit For product from Europe into South East Asia, payment terms are normally 60 days, for product coming from China, they are 30 days, from date of Bill of Lading,Choline ChlorideMajor Grades,Stage 2 deliverables (Screening),Overview of the deliver
10、ables,Stage 3 deliverables (Demand),Stage 4 deliverables (Supply),Supply demand analysis and product allocation,Objective,Competitor profile & market entry options,4,Key Tasks : For target markets,Profile key suppliers and assess future plans in terms of their current product (grades), technology, c
11、apacity addition plans (announced/ likely) Through demand forecast and capacity build up assess likely trade scenario in 2015, 2020 thereby impacting SABIC competitive positioning in the key consumption/ demand centers Assess average operating margins (global averages) For key target markets develop
12、 market entry options, evaluating all key elements for SABICs sustained competitiveness Compute a typical netback from the geography (country-wise) (price less cost to serve, to assess competitiveness of SABIC),Market needs and entry options,Stage 4 (tasks): Assessing SABICs market positioning and d
13、efining market entry strategy.,Deliverables on next slide,Objective,Deliverables : For key target markets,Profile key suppliers/ competitors in select regions detailing: Current capacities, capacity addition plans (owner, technology, location and target application) Typical sales setup and customer
14、support provided SABICs rank (overall) and in merchant market (volume wise) 2010 & 2015 Current plant operation rate vs. profit margins and future trends Regional Trade scenario (likely based on future capacity and emerging demand) 2010, 2015 SABIC Competitiveness on the product in target markets (a
15、mong other suppliers) supported by delivered cash cost (at year 2010 and 2015) PESTLE analysis for SABIC to serve target markets Political, economical, social (usage), Technology (applications/ substitutes), Legal (barrier to trade) and environmental (hazard assessment) SWOT analysis for SABIC and M
16、arket entry options Cost to serve for select regions,Competitor profile & market entry options,4,Market needs and entry options,Stage 4 (deliverables): Assessing SABICs market positioning and defining market entry strategy.,Supply analysis SEA,Choline ChlorideSupply in SEA,2007 Fragmentation of supp
17、ly,Leading suppliers in the region include: Chinese imports (75-80%) Shandong NB Taminco (former UCB) Taminco (former Akzo Nobel) European imports (15-20%) Korean imports (5-9%) There are 100% imports in the region, with no local production BASF in Thailand is just a converter from liquid to powder
18、Thai Choline Chloride Co. Ltd. has taken technology from Davy process to set up a CC plant for 20KT and start production by Q1, 2009,Major suppliers of Choline Chloride in SEA,Choline Chloride Supply/Demand Balance in SEA,Production19 KT* Capacity 20 KT*,Exports 15 KT,Exports 12 KT,Exports 9 KT,Impo
19、rts 4 KT ,Imports 2 KT ,Imports 3 KT ,Imports 1 KT ,*Thai capacity to come online in Q2/2009, to be verified Assume some customers will continue to buy from importers but volume will continue to decrease with time,Production19 KT* Capacity 20 KT*,Production19 KT* Capacity 20 KT*,Production19 KT* Cap
20、acity 20 KT*,Exports 4 KT,Supply analysis China,Choline ChlorideSupply in China,2007 Fragmentation of supply,Leading suppliers in the region include: Shandong NB Taminco (2 plants) Tianjin Bohai Tianjin No_2 Shandong NB has plans to increase its capacity by another 50% by 2010 Chinese producers with
21、 less than 5kT capacity per annum will also increase their overall capacity by another 50% by 2010 There are no imports in the region Infact exports account for 55% of regions production,Major suppliers of Choline Chloride in China,Choline Chloride Supply/Demand Balance in China,Exports 38.85 KT,Exp
22、orts 31.85 KT,Exports 23.85 KT,Imports 0 KT,Imports 0 KT,Imports 0 KT,Imports 0 KT,Production 50.25+14.6 KT* Captive Use: 2 KT Capacity 64.5+20 KT*,*Increase in capacity by 20 KT by Shandong NB Assumed 1 additional KT used in captive consumption,Production 50.25+14.6 KT* Captive Use: 2 KT Capacity 6
23、4.5+20 KT*,Production 50.25+14.6 KT* Captive Use: 2 KT Capacity 64.5+20 KT*,Production 50.25+14.6 KT* Captive Use: 2 KT Capacity 64.5+20 KT*,Exports 5.85 KT,Choline Chloride Supplier Profile,Choline Chloride Supplier Profile,Supply analysis Other regions to be developed,Stage 2 deliverables (Screeni
24、ng),Overview of the deliverables,Stage 3 deliverables (Demand),Stage 4 deliverables (Supply),Supply demand analysis and product allocation,Future position of SABIC To be developed,Kline Global Headquarters Kline & Company, Inc. Overlook at Great Notch 150 Clove Road Little Falls, NJ 07424-0410 Phone
25、: +1-973-435-6262 Fax: +1-973-435-6291 www.KlineG,If you require additional information about the contents of this document or the services that Kline provides, please contact:,Kline is a worldwide consulting and research firm dedicated to providing the kind of insight and knowledge that helps compa
26、nies find a clear path to success. The firm has served the management consulting and market research needs of organizations in the chemicals, materials, energy, life sciences, and consumer products industries for nearly 50 years. For more information, visit www.KlineG.,Americas _ Asia Pacific _ Europe _ Middle East,Fred Duplessis Senior Vice President Phone: +44 (1865) 784 464 F,Mark De Decker Director Kline Europe Phone: +32 2 770 47 40 Mark.dedeckerkline-, Kline & Company, Inc. 2007. All rights reserved.,