"We focus on what we can influence, growing our specialty project pipelines and focusing on further supplier expansion."
Can you give us an overview of IMCD Asia’s latest acquisitions?
Last year was a record year for IMCD globally. In the last 12 months we have made three big acquisitions, namely Sanrise in China, Euro Chemo-Pharma in Malaysia, and most recently Brylchem. These acquisitions were game changers, each valued in the €50-100 million range. IMCD has now been around for over 27 years, and we have always been consolidators in the market. We do this to accelerate growth, although organic growth will always be our number one priority.
We treat mergers and acquisitions as an accelerator, for example, to help us establish a footprint and open opportunities in new markets and regions. For example, our China business has increased by six times in under three years, going from just pharma and advanced materials to the much broader footprint we have today. Five acquisitions later, we have established a full footprint in China, including coatings and construction, beauty and personal care, and other sectors. This rapid expansion would never have been possible through organic growth alone, at least at that time. Moreover, many of the companies we acquired were exclusively focused on one country, but IMCD opened the whole region to them.
What are some challenges the industry is facing and how are you tackling them?
We have seen a softening in demand in Q2 2023, which is a challenge we feel confident we can tackle. We focus on what we can influence, growing our specialty project pipelines and focusing on further supplier expansion. We want to be ready to partner with new suppliers, to assist with marketing and sales for example, and drive growth beyond what they would be able to do on their own. We continue to invest in laboratories, as we sell formulation expertise and solutions, not products. In China, we are investing in a full-fledged industrial lab and expanding and upgrading an existing lab in Indonesia. Furthermore, we are driving digitalization throughout the region; we are proud to have unified CRM and ERP systems that provide consistency and transparency to our partners. We are always looking at further ways to enhance our pipelines to get new customers and prospects. Targeted digital marketing campaigns, reduced response times, and an enhanced omnichannel experience for our customers are just some of the tools and initiatives we employ to tackle these challenges.
Finally, we are continuing to invest in our people, something that is especially important during periods of weaker demand. We continue to enhance our colleagues' technical and sales capabilities, focusing on improved customer service and investing in new and improved offices. This is especially important considering all the recent acquisitions; it is important for new IMCD colleagues to feel culturally integrated in the company. Our culture is unique; very fast, dynamic, and with a lot of entrepreneurial spirit. This allows us to move fast, and I believe it gives us an edge. Focusing on global interconnectivity between our various labs and offices is important, but we also want to give our staff the freedom to exercise their local knowledge and expertise as each region is very different and they know their market best.
What makes Singapore an attractive location for IMCD Asia’s headquarters?
Firstly, Singapore’s connectivity to the rest of the region is excellent, thanks in part to its world-class Changi airport. As such, many of our suppliers are also headquartered here, making it convenient to meet with them. Secondly, Singapore is a very business-friendly city, with an immense amount of knowledge to be found locally.
What are your priorities for the next year?
As usual, we will continue to follow our five-pillar strategy. We will drive organic growth, mainly by focusing on developing the pipeline of our suppliers and making them successful, which usually leads to supply expansion opportunities. We will continue to target mergers and acquisitions, push digitalization, and invest in our culture and people, as people are the biggest asset in distribution. Sustainability is becoming increasingly important here in Asia, and we are striving to develop more sustainable formulations while also improving the sustainability of our supply chains.